John M. Mekulsia - Page 29

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          nonpartnership items at the commencement of a criminal                      
          investigation against him.  Petitioner further asserts that since           
          respondent could exercise no judgment or discretion in issuing              
          the notice once the criminal investigation of Jay Hoyt began, the           
          procedure in the regulation requiring notification is a                     
          ministerial act.  Accordingly, he concludes that respondent’s               
          failure to send the required notification to Jay Hoyt was an                
          error in performing a ministerial act that contributed to the               
          accrual of interest.                                                        
               Petitioner asserts that had respondent notified Jay Hoyt on            
          October 17, 1989, the date of the first criminal investigation of           
          Jay Hoyt after the first contact by respondent relating to the              
          audit of SGE,10 petitioner would have become aware of Jay Hoyt’s            
          fraud and could have made informed decisions about the SGE                  
          deductions and credits he claimed.  Further, petitioner claims              
          that respondent’s failure to send Jay Hoyt the notification                 
          concealed Jay Hoyt’s fraud until December 31, 1998, the date                
          petitioner alleges that investors had sufficient information                
          concerning the fraud.  On the basis of these claims, petitioner             
          requested that respondent abate interest from October 17, 1987,             
          until December 31, 1998.  He contends that respondent’s failure             
          to abate interest for this period was an abuse of discretion.               

               10  Respondent’s first contact with petitioner for purposes            
          of sec. 6404(e) was Dec. 17, 1987.  See supra note 9.                       

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