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further stated: “At the time appellants invested, there were
few, if any, warning signs that they would not be entitled to the
deduction.” Id. at 1522-1523. In this case, we have held that
petitioners’ reliance upon Mr. Meinke’s advice was not reasonable
because of the inherent conflict of interest. Furthermore, there
is no evidence that petitioners received advice from anyone
independent of the investment, or that they conducted their own
investigation into the propriety of the deduction. Petitioners
may not rely upon a “lack of warning” as a defense to negligence,
where there is no evidence that a reasonable investigation was
ever made which would have allowed them to discover such a lack
of warning.
Petitioners also cite Heasley v. Commissioner, 902 F.2d 380
(5th Cir. 1990), revg. T.C. Memo. 1988-408. The relevancy of
Heasley to petitioners’ situation is unclear. Unlike the
taxpayers in Heasley, petitioners are not moderate-income, blue-
collar investors. On the contrary, Mr. Robnett was a dentist,
and both petitioners had received college degrees. Furthermore,
Ms. Robnett did not read the private placement memorandum (there
is no evidence that Mr. Robnett did so either), and petitioners
made little or no effort to monitor their investment. Finally,
petitioners were educated and had at least some level of
investment experience--as indicated on their 1982 tax return;
petitioners were involved with at least two other partnership
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