Phyllis E. Campbell - Page 17

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          Campbell never discussed the details of his trading activities              
          with petitioner.                                                            
               Further, the totality of the circumstances indicates that              
          Mr. Campbell was evasive about the family finances.  Although the           
          financial statements from petitioner’s Refco account were mailed            
          directly to her home address, Mr. Campbell had complete control             
          over the cashflow into and out of her account.  He treated the              
          funds in petitioner’s Refco account as available for use in                 
          offsetting losses in his other trading activities.  Mr. Campbell            
          did not consult her when he withdrew $2.6 million from her Refco            
          account to invest in the London straddle.  In addition, Mr.                 
          Campbell failed to inform petitioner that their accountant warned           
          him that the loss resulting from the London straddle would be               
          disallowed.  We find that Mr. Campbell’s act of depriving                   
          petitioner of the benefit of the money earned in her account and            
          using it to finance a tax-motivated transaction without informing           
          her amounts to evasive conduct.                                             
               We next address the issue of whether there is evidence of              
          any substantial unexplained improvement in the family’s standard            
          of living.  Petitioner did not benefit from the underreported               
          income.  The money invested into the London straddle from                   
          petitioner’s account was never returned to her.  There is                   
          evidence that the Campbells’ lifestyle began to deteriorate in              
          1983, and it continued to do so over the next decade.  Because of           






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