-237-
absolutely nothing to explain why it was necessary or desirable
to remove TMT and BWK from IRA’s consolidated group. Considering
all the circumstances surrounding Carlco, TMT, and BWK, see
discussion infra pp. 278-288, Kanter’s testimony lacked
credibility. Carlco, TMT, and BWK were removed from IRA’s
consolidated group in 1984 to reflect the reality that those
entities were owned and controlled by Lisle, Ballard, and Kanter,
respectively, and each would be responsible for its own tax
liabilities going forward.
d. Kanter’s Testimony Regarding IRA
The STJ report, at 83 note 36, treats as credible Kanter’s
testimony that he served as an adviser, attorney, and consultant
to IRA and he made recommendations to Freeman and Weisgal, who
made final decisions regarding IRA’s investments. This
credibility determination was manifestly unreasonable inasmuch as
(1) Kanter conceded that, for several years during the 1980s,
Freeman was too concerned with his own legal woes to manage IRA,
and (2) Weisgal could recall little about IRA’s operations. As
discussed infra pp. 276-278, IRA was simply Kanter’s alter ego,
and Kanter’s testimony to the contrary lacked credibility.
e. Kanter’s, Ballard’s, and Lisle’s Denials
The STJ report, at 72-81, treats as credible Kanter’s and
Ballard’s testimony, and Lisle’s statement to IRS agents, that
they were not engaged in a kickback scheme during the years at
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