Zabetti A. Pappas - Page 32

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          named Michael L.  Mr. L. testified to paying substantial sums for           
          escort services in 1989 and 1990 that were provided in                      
          petitioner’s E. 77th Street apartment.  He could not, however,              
          identify petitioner in person, and he was uncertain whether a               
          person he knew as “Angel” was the person depicted in a photograph           
          of petitioner taken close to the years in issue.  He described              
          the “Angel” with whom he had dealings as a person who bears                 
          little resemblance to petitioner.  The record before us fails to            
          provide an adequate basis for finding that petitioner, rather               
          than some of her associates, received unreported income in the              
          form of direct payment for escort services from Mr. L. during the           
          years at issue.  The evidence nevertheless supports a finding               
          that petitioner received $4,000 in escort income from Mr. L., and           
          that she received this amount in 1990.  In the summer of 1990,              
          Mr. L. lent $4,000 to “Real Services Corp.”  Two months later,              
          petitioner signed and issued a check, presumably in repayment,              
          for $4,800.  The check was dishonored, and Mr. L. acknowledged              
          that his loan was “most probably” repaid in the form of escort              
          services.  Although Mr. L. did not pay petitioner directly for              
          escort services, petitioner’s signature on the invalid check                
          nevertheless connects her to the receipt of $4,000 in 1990 in               
          exchange for which Mr. L. received such services.  We accordingly           
          sustain respondent’s determination only to the extent of $4,000             
          of unreported escort income in 1990.                                        

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