Domer L. Ishler - Page 28

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          the revocation resolution because respondent did not show that              
          respondent had possession of all of SCB’s documents relating to             
          Camaro’s accounts.  We disagree.  A letter from the legal                   
          department of SCB dated September 29, 1997, states that the bank            
          does not have a copy of Camaro’s December 13, 1983, resolution.             
               Petitioners point out that petitioner did not write checks             
          on Camaro’s SCB accounts while he had signature authority over              
          those accounts.  That fact is not significant because petitioner            
          could and did direct Choy to make transfers from the Camaro                 
          accounts to him or on his behalf.                                           
               A taxpayer’s use of a complex scheme to divert income from             
          his corporation to third parties he controls may be evidence of             
          the taxpayer’s attempt to conceal income.  Bradford v.                      
          Commissioner, 796 F.2d 303, 307-308 (9th Cir. 1986), affg. T.C.             
          Memo. 1984-601.  Petitioner arranged for payments from NSA to               
          bypass TCM and instead to be paid to Camaro and for payments from           
          various sources, including Midtex Relays, to bypass TCM and be              
          paid to Double D or petitioner.                                             
               A taxpayer's diversion of corporate funds for his or her               
          personal use is evidence that the taxpayer committed fraud.                 
          Solomon v. Commissioner, 732 F.2d 1459, 1460-1461 (6th Cir.                 
          1984), affg. T.C. Memo. 1982-603; United States v. Brill, 270               
          F.2d 525, 527 (3d Cir. 1959).  Petitioner used Camaro to divert             
          NSA payments to himself and to his family and friends through an            

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