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have no jurisdiction in this partnership level proceeding over
nonpartnership items, which can only be determined at the
individual partner level. Affiliated Equip. Leasing II v.
Commissioner, 97 T.C. 575, 576 (1991).
The Court shall not allow petitioners to freely interchange
the partners with the partnerships to suit their arguments.
Accordingly, when addressing the petitioners’ theft loss
arguments, the Court will apply the distinction between the
partners and the partnerships as required by law.
(i) Jay Hoyt’s Conviction of Federal Crimes
On February 12, 2001, Jay Hoyt was convicted of 1 count of
conspiracy to commit fraud, 31 counts of mail fraud, 3 counts of
bankruptcy fraud, and 17 counts of money laundering. See United
States v. Barnes, et al., No. CR-98-529-JO-04 (D. Or. Feb. 12,
2001). The indictment charged Jay Hoyt and others with
conspiring to “defraud thousands of investors” by selling
investment interests “by means of false promises and
representations.” The U.S. District Court described Jay Hoyt’s
crimes as “the most egregious white collar crime committed in the
history of the State of Oregon.” United States v. Hoyt, 47 Fed.
Appx. 834, 836 (9th Cir. 2002). Jay Hoyt was ordered to pay
restitution to each victim (investor-partner) in an amount equal
to the total payments each individual made to the Hoyt
organization.
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