Michael and Penny Rhodes - Page 8

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          products.  Ms. Rhodes stated that C.O. was a Frank’s employee               
          whose name was Chloe.  At trial, several employees and managers             
          of Frank’s testified that the purchase orders presented by Ms.              
          Rhodes were not from Frank’s, the store only sold items wholesale           
          from corporate headquarters, and the locations from which Ms.               
          Rhodes stated she bought the supplies did not have enough cash              
          receipts on the days in question to support purchases in the                
          amounts petitioners claimed.  Additionally, the corporate human             
          resources manager for Frank’s during the years in question                  
          testified that he and another human resources employee verified             
          that no Chloe, Chloe O., or C.O. had ever worked at the Frank’s             
          locations where Ms. Rhodes claimed she made her purchases.                  
               Although Ms. Rhodes told the examiner that all her purchases           
          were made inside the Frank’s store, she testified at trial that             
          she purchased her merchandise in the parking area of the store              
          off the back of a large truck that was attended to by Chloe, whom           
          she believed was a Frank’s employee.  She testified that,                   
          although Frank’s had refused to sell merchandise wholesale to               
          her, Chloe approached her and offered to sell the merchandise to            
          her at wholesale prices.  Ms. Rhodes claimed that Chloe would               
          call her whenever a new “shipment” arrived and then she would               
          meet Chloe in the parking lot of Frank’s and complete the sale.             
          Chloe dealt only in cash and gave Ms. Rhodes a Frank’s purchase             
          order at the end of each transaction.  Ms. Rhodes testified she             

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