Mark D. Pridgen and Kay D. Pridgen - Page 11




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                  As mentioned above, Beaufort Leaf was in the business               
             of buying and selling tobacco.  The marketing of tobacco                 
             is subject to Government regulation under the Agricultural               
             Adjustment Act of 1938, ch. 30, secs. 311-314, 52 Stat. 45,              
             current version at 7 U.S.C. secs. 1311-1316 (1994), which                
             includes a record-keeping mechanism that is designed to                  
             account for all tobacco sales and purchases.  See                        
             generally, Cole v. USDA, 33 F.3d 1263, 1265-1266 (11th Cir.              
             1994).  As part of that record-keeping mechanism, dealers,               
             like Beaufort Leaf, are required to maintain a Dealer's                  
             Record on Form MQ-79 issued by the U.S. Department of                    
             Agriculture.  The Form MQ-79 is a comprehensive record of                
             each purchase and resale of tobacco including the date, the              
             amount of tobacco, the identity of the seller or purchaser,              
             and a running balance of the amount of tobacco on hand                   
             after each transaction.  In the case of purchases or                     
             resales at auction, the Form MQ-79 lists the warehouse at                
             which the purchase or sale took place and requires a                     
             warehouse representative to sign the dealer's Form MQ-79.                
                  Dealers are required to file their Dealer's Record                  
             with the Agriculture Stabilization and Conservation Service              
             (ASCS) on a weekly basis.  The amount of tobacco marketed                
             is controlled by a quota system that establishes an allot-               
             ment of tobacco for each tobacco-producing farm.  See Cole               





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