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Mr. Tedford would repay her, so she decided to let him borrow the
money.
In 1994, Mr. Tedford began using his and petitioner’s
personal funds to transfer sums to Border and pay some of
Border’s business expenses. Border used the sums transferred by
Mr. Tedford and petitioner to buy supplies and equipment and to
make loan payments to SunWest.
On January 12, 1994, Mr. Tedford transferred $90,000 to
Border out of the cash-surrender moneys available on two personal
insurance policies. The transfer is evidenced by a letter from
U.S. Life Insurance Services Corporation (U.S. Life letter),
dated December 21, 1993. Attached to the front page of the
letter is a handwritten “Post-it” note that states, “Border owe
[sic] J.C. Tedford - to be paid over 6 mos. at 8% int.” Stapled
to the letter are copies of two checks totaling $90,000, both
dated January 12, 1994, a blank page entitled “Demand Note,” and
copies of the backs and fronts of the same two checks with
endorsements. On the back of the correspondence is a stamp that
reads “Deposited to the Credit of ck#6004210-9002, Endorsement
Guaranteed, SunWest Bank of El Paso”, signed by the vice
president of SunWest, and also signed by Mr. Tedford. This
transfer is also evidenced in Border journal entry no. JE0106,
posted on January 25, 1994, by Lucy Salas, Border’s bookkeeper at
the time, in the Corporate accounting records of Border. The
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