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obtain those consents but obtained them from Steele by contacting
Leatherstocking’s authorized representatives. Kerzner did not
threaten Steele or offer him any incentive to agree to the
consents.
Respondent resumed his audit of Leatherstocking in January
1994. At that time, respondent assigned the audit to Revenue
Agent Robert Clements (Clements). Respondent also assigned to
Clements the audits of the other entities related to
Leatherstocking. Kerzner was not assigned those audits because
he had worked on the grand jury case involving Steele.
During his audit of Leatherstocking, Clements did not
personally speak with or meet with Steele, who was then in
prison, but primarily corresponded with Steele by mail. In
obtaining the consents that Steele signed after January 1994,
Kerzner did not threaten Steele or offer him any incentive to
agree to the consents. Nor did Clements ever ask the limited
partners of Leatherstocking to sign consents individually.
Clements never had any contact with the Leatherstocking limited
partners regarding the audit of Leatherstocking.
On September 16, 1997, respondent issued the FPAAs for the
subject years. Respondent never issued to Steele written
notification that his partnership items would be treated as
nonpartnership items. Respondent never issued to Steele written
notification that he was under criminal investigation.
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