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Mr. Sowards rendered services to STL and its customers throughout
the period of time that STL was making payments to WPA, establish
that Mr. Sowards received remuneration for services he rendered
to STL, its customers, and/or Mr. Strong. That remuneration was
in the form of the STL checks to WPA which were deposited into
the WPA account. We find that the understatement of this income
to be clear and convincing evidence of fraudulent intent.
Mr. Sowards failed to maintain records of income. His
allegation of their alleged destruction is not believable. Ms.
Nunn did not testify that Mr. Sowards’s financial documents were
destroyed in a fire at her house. We find the absence of
records, given the circumstances of this case, to be strong
evidence of fraudulent intent.
Mr. Sowards concealed assets and income from petitioners’
tax return preparer. Petitioners’ return preparer for 1995 and
1997 testified that he was not aware of WPA or STL. Mr. Sowards
failed to disclose the significant sums of money flowing from STL
to WPA and the fact that all these sums were used for his
personal needs. We find this failure to inform the return
preparer, given the circumstances of this case, to be strong
evidence of fraudulent intent.
Mr. Sowards failed to cooperate with tax authorities. He
made numerous false and inconsistent statements to respondent’s
employees. When interviewed and questioned on September 30,
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