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The Cheshires’ Use of the Retirement Distributions
The Cheshires made several large disbursements out of the
Austin Telco account in 1992. Specifically, $99,425 was withdrawn
to pay off the mortgage on the family residence, and $20,189 was
withdrawn to purchase a 1992 Ford Explorer.
The retirement distributions were also used to pay family
expenses, provide startup capital for Mr. Cheshire’s newly formed
sole proprietorship, Academic Resources Management Systems (ARMS),
and for investments.2 In addition, the retirement distributions
were used to satisfy loans taken out to acquire a family truck and
a car for one of their children as well as to open a college bank
account for their daughter. The Cheshires retained joint ownership
of this account.
On September 22, 1992, Mr. Cheshire opened a second account
(account No. 25239-87) at the Austin Telco Federal Credit Union and
transferred the remaining proceeds of the retirement distributions
from account No. 9633-09 into this account. On November 12, 1992,
Mr. Cheshire wrote a check from this second account in the amount
of $6,300 payable to “A.R.M.S.”; this amount was subsequently
deposited into ARMS’ bank account. In 1992, the funds in account
No. 25239-87 earned $26 in interest.
2 On Apr. 24 and May 19, 1992, Mr. Cheshire deposited
$40,000 and $5,301, respectively, into a brokerage account at
Edward D. Jones & Co.
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Last modified: May 25, 2011