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Portillo v. Commissioner, 932 F.2d 1128 (5th Cir. 1991),
affg. in part and revg. in part T.C. Memo. 1990-68;
Petzoldt v. Commissioner, 92 T.C. 661 (1989); and Tokarski
v. Commissioner, 87 T.C. 74 (1986). Petitioners
acknowledge that there is evidence linking the unreported
income to Beaufort Leaf, such as the fact that each of the
undeposited checks for 1991 was made payable to Beaufort
Leaf. Nevertheless, petitioners argue that such evidence
is not sufficient to satisfy respondent's burden of proof
under the cases cited above. According to petitioners,
respondent must introduce "significantly more compelling
evidence, such as proof that the Petitioners received the
proceeds of Robert's [sic] over-quota transactions."
At the outset, we note that there is evidence that,
during the years in issue, Mr. Roberts joined a group
of persons headed by Mr. James V. Wells to engage in a
fraudulent scheme to acquire and sell excess-quota tobacco.
In paragraph 5(d) of both petitions, petitioners describe
the scheme as a widespread scheme, involving Mr. Roberts
and "numerous other bogus dealers and/or legitimate
dealers". Paragraph 5(d) of the subject petitions states
as follows:
In 1990 and 1991, the managing partner
entered into an illegal scheme to fraudulently
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