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Prior to 1980, Mr. Korchak’s investment portfolio consisted
of stocks and bonds. During 1980, Mr. Korchak became a client of
Marcus V. Cole (Mr. Cole), who at that time worked for Merrill
Lynch and who was deceased at the time of the trial. During that
year, petitioner and Mr. Korchak purchased rental property
located on Hilton Head Island. In 1981, without consulting
petitioner, Mr. Korchak invested in a bus rental activity (Mr.
Korchak’s bus rental investment) and three oil and gas partner-
ships (Mr. Korchak’s three oil and gas partnership investments).7
Although Mr. Korchak did not consult petitioner before he in-
vested in that bus rental activity and those partnerships, he may
have mentioned to her that he had invested in a bus rental
activity. However, he would not have provided any details about
that activity to petitioner.
During 1982, Mr. Cole joined the staff of Hamilton Gregg &
Company, Inc. (Hamilton Gregg), a company engaged in the business
of providing financial planning advice to its clients. On or
about December 6, 1982, Mr. Korchak became a client of Hamilton
Gregg, and Mr. Korchak’s primary contact person at that company
was Mr. Cole.
On or about November 24, 1982, Mr. Cole delivered a private
offering memorandum (private offering memorandum) to Mr. Korchak
7Mr. Korchak’s three oil and gas partnership investments
were Kelly-Brock Drilling Partners 1981-1, Odyssey Partners 81
Limited Partnership, and Matagorda Limited Partnership II.
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