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make payments to THC, Kanter attempted to assign income that he
earned on non-Prudential condominium conversion projects to THC.
5. Schnitzer/PMS
Schnitzer was interested in increasing the number of
property management contracts awarded to PMS, a subsidiary of
Century, a company he controlled. To this end, in 1974,
Schnitzer approached Ballard (with whom Schnitzer had previously
dealt in developing office buildings in Houston, Texas) and
offered to give Prudential a 50-percent stock interest in PMS.
Although Prudential ultimately declined Schnitzer’s offer, from
1974 through 1977 PMS’s property management business increased
substantially, with a large percentage of its contracts coming
from Prudential.
In 1977, Schnitzer and Kanter discussed Century’s possible
sale of a 47.5-percent stock interest in PMS to IRA. Kanter told
Schnitzer that he had various business contacts, including the
Pritzker family, through which Kanter could obtain additional
property management business for PMS. Before agreeing to sell
PMS’s common stock to IRA, Schnitzer conferred with Ballard to
obtain his view as to whether Kanter could deliver additional
management contracts for PMS. In November 1977, Century sold a
47.5-percent stock interest in PMS to IRA at a bargain price of
$150,000.
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