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account was petitioner’s personal account, the securities
transactions from which were reported on his individual tax
returns. On August 7 and October 7, 1987, petitioner transferred
$59,582 and $18,257, respectively, from IL NA Tours to the Allied
account.
In August 1987, petitioner transferred $109,777 of IL NA
Tours’ funds to account No. 879 62934 (Chung No. 2) at Merrill
Lynch, an account which petitioner had opened at some time in
Chung’s name and under Chung’s Social Security number. Chung,
however, was a nominee only as he had no ownership interest in
Chung No. 2 and received no benefit from the account. Petitioner
closed Chung No. 2 on April 6, 1988, and transferred the assets
in the account at its closing to account No. 03T 115428 (Chung
No. 4) at Prudential-Bache Securities (Prudential-Bache7), which
he had opened in Chung’s name on or before April 6, 1988. Chung
No. 4 was funded with stock and money that came directly or
indirectly from IL NA Tours.
Between January 1 and October 18, 1987, an additional
$259,027 of IL NA Tours’ corporate funds was transferred to
petitioner’s personal control, as follows:
7 Prudential-Bache Securities at some time became known as
Prudential Securities, Inc. For simplicity, we will refer to the
brokerage firm throughout the opinion as Prudential-Bache,
regardless of it precise name at any particular time.
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