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employee. According to the STEP plan, any life insurance that
was not purchased could be surrendered by the trustee or
continued with the plan as beneficiary.
VII. VRD/RTD’s Contributions to STEP
A. Forwarding Fees
The PCs of the participating doctors forwarded to VRD/RTD
amounts required by STEP to pay the premiums due on the whole
life insurance policies written on the lives of the participating
doctors. The PCs and VRD/RTD referred to these transactions as
“forwarding fees”. During the subject years, VRD/RTD received
the following amounts of forwarding fees from the PCs:
PC 1993 1994
Vincent R. DeAngelis M.D.P.C. $300,000 $300,000
Rodolfo T. Domingo M.D.P.C. 225,000 225,000
Keith Durante M.D.P.C. 50,000 50,000
Total 575,000 575,000
The PCs deducted these forwarding fees as expenses in the year of
payment.
VRD/RTD recorded its receipt of the forwarding fees from the
PCs as “Fee Income--DeAngelis PC”, “Fee Income–-Domingo PC”, and
“Fee Income–-Durante PC”, respectively. VRD/RTD recorded that
these amounts were received from the PCs as pension contributions
with respect to the participating doctors. VRD/RTD also received
a total of $10,000 in each of the years 1993 and 1994, from the
five PCs that were partners in VRD/RTD. The $10,000 was
forwarded in each year to the STEP plan to pay the premium due on
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Last modified: March 27, 2008