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Kanter’s instructions were carried out by administrators and
bookkeepers including Freeman, Weisgal, Meyers, and Gallenberger.
There is no evidence that anyone at IRA or THC provided any
services to The Five. Kanter directed The Five to execute
agreements with and make their payments to IRA, THC, and their
subsidiaries in an effort to conceal that Kanter, Ballard, and
Lisle earned the payments remitted by The Five. IRA, THC, and
their subsidiaries were Kanter’s alter egos. Kanter, Ballard,
and Lisle improperly attempted to assign their income to IRA,
THC, and their subsidiaries.
2. Carlco, TMT, and BWK
a. Diversification and Deconsolidation
Kanter testified that (1) IRA always held a controlling
interest in Carlco, TMT, and BWK; (2) IRA transferred a
substantial portion of its cash and other property to Carlco,
TMT, and BWK beginning in 1984 as a “free cashflow” asset
allocation; (3) the allocation would allow for diversification of
IRA’s investments in that Carlco (with Lisle as manager) was to
invest primarily in municipal bonds), TMT (with Ballard as
manager) was to invest primarily in real estate, and BWK (with
Kanter as manager) was to make assorted investments; and (4)
Carlco and TMT were removed from IRA’s consolidated group of
corporations for tax reporting purposes (by issuing shares of
preferred stock to trusts for the benefit of Ballard’s and
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