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ravenous appetite for funds necessary to support its real
estate empire." According to respondent, the centerpiece
of EPIC's "scheme" involved overmortgaging the properties
purchased by each partnership "by obtaining inflated,
defective appraisals to support nominal purchase prices
that permitted EPIC to generate substantial builder fees,
rental deficit contributions, and rental advances".
Respondent also contends that EPIC's projected break-even
appreciation rates of 7.99 percent and 9.15 percent "were
approximately twice as high as the actual appreciation
rates from 1980 to 1985" and that EPIC failed to disclose
its inability to sell the properties of older partnerships,
the adverse market conditions in the housing industry, the
re-syndications of properties from "matured" partnerships
into new properties, the use of defective appraisals to
arrive at inflated values, the purchase of properties for
partnerships from EPIC subsidiaries, the nature and use of
the "sweep" account, and the payment and appraisal fee for
property not purchased by EA 83-XII. We disagree.
Under respondent's view of the facts, EPIC was
interested only in obtaining lump-sum payments from new
property acquisitions and the fees attributable to those
new properties. Respondent ignores the fact that EPIC's
business of syndicating real estate partnerships depended
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