Investment Research Associates - Page 301




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          entities and individuals that were recorded as loans receivable.             
          There were never any notes evidencing the loans, the loans were              
          never secured, and substantial amounts were written off as                   
          worthless.  We do not think that an independent trustee would                
          have permitted corporations in which the trust was either the                
          sole shareholder or the majority shareholder to have made such               
          "loans".  A truly independent trustee of a valid trust (who often            
          also served as an officer or director of the corporations) could             
          not permit such transactions without breaching his fiduciary                 
          duties to the trust and the corporations.   If Weisgal had been              
          an independent trustee, we do not think that he would have risked            
          being held liable for such breach.  The "loans" were made and                
          written off as part of Kanter's income diversion and laundering              
          scheme at Kanter’s behest.  The corporations and trusts merely               
          served as part of the scheme.                                                
               Kanter's control over the administration of BRT is also                 
          shown by the fact that BRT was a client of Administration Co.,               
          Administrative Enterprises, and Principal Services, which were               
          all entities controlled by Kanter.                                           
               Weisgal did not maintain the books and records of BRT.  They            
          were maintained by Kanter, Administration Co., Administrative                
          Enterprises, or Principal Services.  When respondent served a                
          subpoena on Weisgal for the books and records of BRT, no records             
          were produced.  Although he was the named BRT trustee, Weisgal               






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