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Administration Co. and the Bea Ritch Trusts. The only other
assets of Cashmere were the partnership interests--which were the
only assets Zell and Lurie wanted.
With respect to the notes transferred by the trusts to
Cashmere, Kanter was acting in some instances as both the debtor
and the creditor (i.e., notes from the Beach Trust, the BWK
Family Trust and the Baroque Trusts, with respect to which
entities Kanter was the grantor and deemed owner as well as the
original payee on the note and on one note in which Kanter was
the maker). There was an absence of regular business records
maintained or presented in connection with all of the alleged
notes, and at least one of the notes (GO's Associates) related to
indebtedness incurred in connection with a bogus computer leasing
transaction.
The makers of each of these notes were Kanter individually
or his controlled entities. Four of the notes were transferred,
sold, and assigned to the BWK Revocable Trust as of May 1, 1983,
although it is clear that, in at least one case, the assignment
did not take place before August 31, 1983. The total principal
amount of the notes transferred to Cashmere almost exactly offset
the aggregate negative capital accounts of the partnership
interests. The notes were all payable on August 31, 1983, and
were purportedly paid by checks drafted on Administration Co.'s
special E account.
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