James E. Jenkins and Ruth A. Jenkins - Page 6

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          The court was unconvinced and sentenced petitioner to 60 months             
          in prison and a fine of $100,000.                                           
               At the sentencing hearing, Agent David Gannaway, the primary           
          Internal Revenue Service agent for this matter, testified                   
          regarding his investigation of the illegal gambling operations.             
          He submitted a report consisting of a spreadsheet summarizing the           
          figures used in the nightly financial reports prepared by                   
          petitioner.  Relying on figures in the financial reports, he                
          determined the amounts petitioner and Hood received from the                
          bingo games operated from 1994 through 1997.  He then computed              
          the profit for petitioner and Hood based on what he concluded               
          were the profit splits between the charities, petitioner, and               
          Hood.  For JVFD and the Ruritan Club, he concluded that                     
          petitioner and Hood’s percentage of the proceeds was not fixed              
          but varied from 40 percent to 70 percent based on attendance.  He           
          further concluded that petitioner and Hood’s percentage of the              
          proceeds relating to Handicaps Unlimited was 80 percent.                    
               In the report, Agent Gannaway concluded, and Hood agreed,              
          that petitioner and Hood received $1,181,560 from 1994 to 1997.             
          This amount was reduced to $777,896 after deducting the amount he           
          concluded that petitioner and Hood received for rent and                    
          supplies.  Although Hood did not know if $777,896 was accurate,             
          he requested that the Government reduce its determination of the            
          net amount received to $700,000 and asserted that all proceeds              
          were split evenly with petitioner.  In response, the Government             




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