-65-
performed services for clients similar to those which TACI had
provided to TACI’s clients. For a short period in 1989, PSAC
also established two accounts similar to the TACI Special E
Account and the TACI Special Account.
The fees PSAC received from its clients were not sufficient
to fund PSAC’s operations. From the time PSAC came into
existence in 1989 until the time Gallenberger purchased the stock
of PSAC from the ARO Trust in 1990, PSAC borrowed over $100,000
from BWK and THC to pay its employees’ salaries. Gallenberger,
Transcr. at 1980-1982, 1987, 2041. BWK lent the money to PSAC
either directly or through the TACI Special E Account.
Gallenberger, Transcr. at 1983-1984.
Beyond 1990, PSAC did not generate enough fees to cover its
operational costs, continued to operate at a loss, and borrowed
money from BWK. Gallenberger, Transcr. at 1985-1986. At the
time the record in these cases was closed, PSAC had not repaid
the loans from BWK. Id. When borrowing money, Gallenberger
either contacted Kanter about the loan or went ahead and borrowed
the money herself. Gallenberger, Transcr. at 1986-1987.
PSAC’s bookkeeping procedures and return preparation
procedures were essentially the same as TACI’s. Gallenberger,
Transcr. at 1988-1989, 2078. Any questions that Gallenberger had
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