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Seventh, Kanter's reporting of the kickback moneys on the
returns of IRA and Holding Co. was designed to conceal the
scheme, and is another strong indication of Kanter's fraud. See
Lang v. Commissioner, T.C. Memo. 1961-134, where the reporting of
income from property beneficially owned by the taxpayer on the
returns of family members was held to be fraudulent. It is clear
that Kanter used the sham corporations to give the appearance
that the kickback income was earned by them, rather than Ballard,
Lisle, and himself, and that there was no tax due by the
corporations because there were claimed losses sufficient to
offset the income. Moneys were distributed from IRA and Holding
Co. at Kanter's direction to other entities that were created to
conceal further the true nature of the payments. Three of those
entities, TMT, Carlco, and BWK Inc., were controlled respectively
by Ballard, Lisle, and Kanter, and were the repositories of the
kickback moneys distributed from IRA.
Eighth, Kanter routinely used the various conduit entities
as nominees, placing money and property in the names of the
entities to conceal the transactions. In fact, when it was
convenient, he would assert that the entity held an asset merely
as nominee.
Ninth, Kanter created phony loans to disguise the
distributions of the income to himself and others and to evade
the income tax due on the income. He later arranged for sales of
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