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also establishes that Ms. Ford played an integral part in this
understatement of income.
Ms. Ford testified that she had no knowledge of the
understatement, but she owned several of the nominee corporations
at issue in this case. She also recognized the corporate names
of Pooh Bear Investments, Ltd.; Bear & Pebbles Investments, Ltd.;
For Door Investments, Ltd.; and Solar Aquafarms, Ltd. Ms. Ford’s
recognition of these names and their history (she testified that
For Door was a combination of the names Doorn and Ford, and that
Pooh Bear as well as Bear & Pebbles was named for petitioners’
dogs) makes her testimony that she had no knowledge of Mr. Ford’s
activities less than credible. The Court concludes that Ms. Ford
had knowledge of, and involvement in, the fraudulent financial
transactions of 1986. This factor weighs against petitioners.
2. Maintenance of Inadequate Records
Lack of records is indicative of fraudulent intent. Id.
Mr. Ford acknowledged during his testimony in this case that
petitioners kept few records as to the subject transactions. The
“records” in this case consist of handwritten letters, some
canceled checks, a few banking records from domestic and
international accounts, and a stock option exercise agreement by
Ms. Ford. Those records show direct control and management of
the Canadian accounts by both petitioners.
This factor weighs against petitioners.
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