Maciel v. Comm'r

T.C. Memo. 2004-28

UNITED STATES TAX COURT

GEORGE MACIEL, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 7802-00. Filed February 4, 2004.

David M. Kirsch, for petitioner.

G. Michelle Ferreira and Charlotte A. Mitchell, for

respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

RUWE, Judge: Respondent determined deficiencies in

petitioner’s Federal income taxes and penalties pursuant to

section 66631 as follows:

1
Unless otherwise indicated, all section references are to
(continued...)
 - 2 -

Year Deficiency Penalty Sec. 6663

19901 $192,954 $144,715.50
1991 71,337 53,502.75
1992 56,075 42,056.25
1
The notice of deficiency for 1990 states the amounts listed above. In
his answer, respondent decreased the deficiency amount and fraud penalty for
1990 to $172,655 and $129,491.25, respectively.

After concessions,2 the issues to be decided for 1990, 1991, and

1992, are as follows:

(1) Whether, and to what extent, petitioner received and

failed to report income;

(2) whether petitioner is entitled to various adjustments to

reconstructed income not claimed on his returns;

1
(...continued)
the Internal Revenue Code in effect for the years at issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
2
Respondent concedes that for 1990, petitioner is entitled
to deduct $64,679 in expenses associated with the Tri-City Truck
Parts partnership, and petitioner concedes that his distributive
share of income from Tri-City Truck Parts is $41,105. Respondent
concedes that the sec. 6663 penalty for 1990 does not apply to
the tax attributable to the Tri-City Truck Parts and Equipment
(Tri-City) adjustment of $41,105. Additionally, respondent
concedes petitioner’s entitlement to a partnership loss deduction
for the BAMA Equipment partnership of $26,046 for 1991 and a loss
deduction of $8,777 for 1992. Similarly, petitioner agrees that
he is not entitled to a casualty loss deduction of $25,020 on his
Schedule A, Itemized Deductions, for 1992. Respondent agrees
that the fraud penalty does not apply to tax attributable to this
adjustment.

At trial, the parties stipulated that petitioner’s share of
the rental income from PSB Trucking with regard to the Boscell
Road property for 1990 is $46,200, rather than the amount
petitioner reported, $50,400. On brief, respondent concedes that
petitioner is entitled to a capital loss of $3,000 for 1992, with
respect to the BAMA Equipment partnership.
 - 3 -

(3) whether petitioner intentionally failed to report income

in an effort to fraudulently evade the payment of taxes; and

(4) whether respondent’s assessment of deficiencies and

penalties is barred by the period of limitations.

FINDINGS OF FACT

Some of the facts have been stipulated and are so found.

The stipulation of facts, supplemental stipulations of facts, and

the attached exhibits are incorporated herein by this reference.

Petitioner resided in Santa Clara, California, at the time he

filed the petition.

A. General Background

Petitioner has been involved in the trucking business for

more than 20 years. During the years at issue, petitioner was

the sole shareholder, president, and chief executive officer of

Alviso Rock, Inc. (Alviso), a corporation organized and existing

under the laws of the State of California. Alviso was a trucking

and hauling business located in Newark, California.

Additionally, during the aforesaid period, petitioner was the

general manager of George Maciel Trucking, Inc. (GMT), a wholly

owned subsidiary of Alviso. Alviso and GMT were C corporations

that reported their consolidated income on Forms 1120, U.S.

Corporation Income Tax Return, for the taxable years ending

November 20, 1989, 1990, 1991, 1992, and 1993.
 - 4 -

In addition to Alviso and GMT, petitioner engaged in the

following noncorporate business activities.

B. The BAMA Partnership

In 1989, petitioner entered into a partnership with Michael

D. Mitchem named BAMA Equipment (BAMA). BAMA was engaged in the

business of selling new and used trucks. Petitioner owned a 50-

percent interest in BAMA.

During the years in issue, BAMA wrote numerous checks to

petitioner and/or his related corporation(s), which he deposited

into noncorporate bank accounts over which he had signatory

authority. BAMA paid petitioner rent for the use of one of his

real properties, which he deposited into the aforesaid bank

accounts. BAMA was also a sponsor of petitioner’s racing

business.3

On his 1991 and 1992 returns, petitioner claimed deductions

for passthrough losses from BAMA of $56,786 and $8,777,

respectively. For those years, petitioner’s capital accounts in

BAMA were negative $26,046 and $34,823, respectively. As

previously stated, respondent concedes loss deductionss for 1991

and 1992 of $26,046 and $8,777, respectively. Additionally,

respondent concedes petitioner’s capital loss deduction of $3,000

for 1992.

BAMA dissolved in 1992.

3
Petitioner’s racing business is discussed in detail below.
 - 5 -

C. Tri-City Truck Parts and Newark Wreckers

In 1987, petitioner and Peter Viviano (Mr. Viviano) formed

M&V Investments of which each owned a 50-percent interest.4 On

April 14, 1987, M&V Investments purchased a company named Tri-

City Truck Parts and Equipment (Tri-City) for $350,000. The

seller, Raymound Giarrusso (Mr. Giarrusso), took back a $200,000

note from petitioner and Mr. Viviano with the balance of the

purchase price, $150,000, being paid in cash. At the same time,

M&V Investments purchased Newark Wreckers, Inc. (Newark

Wreckers), from Mr. Giarrusso for $50,000, for which each partner

paid $25,000. Accordingly, for the two purchases, each partner

contributed $100,000 and was personally liable under the $200,000

note payable to Mr. Giarrusso.

For each of the taxable years 1987 through 1990, Newark

Wreckers filed Forms 1120. Petitioner was a 50-percent

shareholder and president of Newark Wreckers from 1987 through

1989. Likewise, Tri-City timely filed Forms 1065, U.S.

Partnership Return of Income, for each of the years 1987 through

1990. Petitioner was a 50-percent income and loss partner of

Tri-City.

4
The parties characterize petitioner’s relationship with Mr.
Viviano as a “limited partnership”. However, there is no
indication that the parties entered into a formal limited
partnership or that partnership returns were filed for the years
at issue.
 - 6 -

On April 27, 1990, petitioner sold his 50-percent interest

in M&V Investments (Tri-City and Newark Wreckers) to Mr. Viviano

for $200,000. The $200,000 purchase price was paid in the form

of three cashier’s checks for $100,000, $75,000,and $25,000,

which were initially made payable to Mr. Viviano but were

subsequently endorsed to petitioner. Pursuant to the sales

agreement, petitioner relinquished all claims he had in Tri-City

and Newark Wreckers, and he was discharged from his obligation to

pay on the note to Mr. Giarrusso.5 Petitioner did not report

this sale on his 1990 return.6

5
The Escrow Statement, Bulk Transfer Escrow Instructions,
and Security Agreement list petitioner’s and Mr. Viviano’s
indebtedness to Mr. Giarrusso as $200,000. The 1990 Schedule L,
Balance Sheet, for Tri-City lists the indebtedness as $202,000.
Respondent describes petitioner’s indebtedness as being $101,000.
We assume respondent used the $101,000 as opposed to the $100,000
on the basis of Tri-City’s 1990 Schedule L. We further assume a
scrivener’s error on the part of Tri-City’s tax return preparer
for 1990 and assign no substantive significance to this
discrepancy.
6
Petitioner did, however, attach a statement to his 1990
income tax return which states:

THE ABOVE NAMED TAXPAYER WAS INVOLVED IN A
PARTNERSHIP FOR PART OF THE 1990 TAX YEAR. THE
PARTNERSHIP WAS TRI-CITY TRUCK PARTS. THE
TAXPAYER DID NOT RECEIVE HIS SCHEDULE K-1 (SHARE
OF PARTNERSHIP INCOME & DEDUCTIONS) FOR 1990.
SEVERAL ATTEMPTS WERE MADE TO REACH THE DESIGNATED
PARTNER OF TRI-CITY TRUCK PARTS (PETER VIVIANO).
ALL ATTEMPTS WERE UNSECCESSFUL [sic]. AS A RESULT
THE ABOVE NAMED TAXPAYER WAS UNABLE TO REPORT HIS
SHARE OF THE PARTNERSHIP’S ACTIVITY FOR THE 1990
TAX YEAR.

(continued...)
 - 7 -

During 1987 through 1990, Mr. Viviano and petitioner made

several short-term loans/advances to Tri-City and Newark

Wreckers. There were no formal loan agreements created to

evidence these transactions. The parties followed the practice

of immediately repaying themselves when the entities were able,

usually within 3 weeks to 3 months. Petitioner alleges that he

has never been repaid at least $56,450 in loans and advances, and

he now contends that this amount offsets any gain he realized

upon the sale of M&V Investments to Mr. Viviano.

D. Newark Truck and Body Shop

With part of the funds secured from Mr. Viviano, in May

1990, petitioner purchased land and a vacant building located at

7373 Wells Avenue, in Newark, California, from Mr. Guarrusso for

$200,000. Upon receipt of the three cashier’s checks from Mr.

Viviano totaling $200,000, petitioner purchased two cashier’s

checks made payable to himself, one for $175,000 and the other

for $25,000. On May 16, 1990, petitioner took the $175,000

cashier’s check made payable to himself and purchased two more

cashier’s checks. One of the cashier’s checks was for

6
(...continued)
The date listed next to petitioner’s signature on his 1990
income tax return is Aug. 14, 1991. The date listed on Tri-
City’s 1990 tax return is Dec. 21, 1991. There is no indication
in the record that petitioner filed an amended return for 1990.
There is no indication that petitioner has ever reported this
sale of his interest. Petitioner testified that he believed that
he had reported the sale.
 - 8 -

$127,504.82 and made payable to Fidelity National Title,

apparently the escrow agent for the purchase of 7373 Wells

Avenue, and a second cashier’s check was for $47,495.18 and made

payable to petitioner. On June 11, 1990, petitioner deposited

the second cashier’s check for $47,495.18 and the $25,000

cashier’s check purchased with the funds received from Mr.

Viviano into Bank of Milpitas account No. 512-001-300466.

During the years at issue, petitioner conducted an

unincorporated business from the 7373 Wells Avenue location named

Newark Truck and Body (Newark T&B).7 Newark T&B was engaged in

the business of truck repair for petitioner’s related businesses

and for unrelated third parties. Petitioner was the sole owner

of Newark T&B. Newark T&B had its own invoices and business

cards. Newark T&B performed truck repairs work for which it

received remuneration. Petitioner maintained a bank account at

the Bank of Milpitas, account No. 512-001-300466, in the name of

“George A. Maciel c/o Newark Truck & Body”.

Petitioner garnered significant funds from the Newark T&B

activity.8 Petitioner did not report any of the moneys that

Newark T&B received for repair services on his 1990, 1991, or

7
Petitioner initially characterized Newark T&B as an
“activity”. At trial, petitioner admitted this “activity” was a
business.
8
On brief, petitioner concedes that total deposits
attributable to Newark T&B for the 3-year period were
$123,953.77.
 - 9 -

1992 returns.9 Petitioner’s accountants were not aware of Newark

T&B until after the Internal Revenue Service (IRS) commenced its

audit and investigation. Alviso/GMT’s bookkeeper was also

unaware of the Newark T&B business operations.

E. Petitioner’s Racing Business

During the years at issue, petitioner maintained an

unincorporated automobile racing business under the name “Alviso

Rock/HK Racing”.10 Petitioner was the sole owner of this

business. During the years at issue, petitioner maintained a

bank account at the Bank of Milpitas, account No. 512-001-102605,

in the name “Alviso Rock/HK Racing”. During the years indicated,

petitioner received the following amounts of racing income, which

he deposited into the aforementioned bank account:

Description 1990 1991 1992

Deposits $16,811.57 $14,397 $31,493.96
Less: nontaxables1 (4,125.34) (4,334) (20,144.00)
Net racing income 12,686.23 10,063 11,349.96

1
The parties stipulated the above nontaxable deposits.

The funds were received from, inter alia, sponsors11 and/or

winnings.

9
Petitioner argues that unclaimed expense deductions and
advances/loans substantially offset income that Newark T&B
earned.
10
Initially, petitioner characterized this endeavor as an
“operation”, but he admitted at trial that this “operation” was a
business.
11
Petitioner’s related businesses, Alviso, GMT, and BAMA,
were among the sponsors.
 - 10 -

Petitioner did not report any of the above-listed deposited

funds on his 1990, 1991, or 1992 returns. Furthermore,

petitioner’s accountants were not aware of this business activity

until after the IRS commenced its audit and investigation.12

F. Rental Property Income

During 1990, 1991, and 1992, petitioner owned and held

numerous real properties for investment and lease. One such

property was located at 41550 Boscell Road, Fremont, California

(the Boscell property). In 1990, petitioner owned 50 percent of

the Boscell property with Thomas Viviano. In May 1991, Thomas

Viviano sold his 50-percent interest in the Boscell property to

petitioner.

During the years at issue, the Boscell property was leased

to two tenants. One tenant, PSB Trucking, rented space at the

Boscell property for $8,400 per month. Petitioner reported

rental income attributable to PSB Trucking of $50,400,13 $79,800,

and $100,800 for 1990, 1991, and 1992, respectively.

12
Petitioner argues that if unclaimed expense deductions are
considered, his racing business lost money.
13
At trial, the parties stipulated that petitioner’s share
of the rental income from PSB Trucking with regard to the Boscell
Road property for 1990 is $46,200, rather than the amount
petitioner reported, $50,400. Respondent concedes that
petitioner reported his proportionate share of the rental income
attributable to PSB Trucking for 1991 and 1992.
 - 11 -

A portion of the Boscell property was also rented to P.J.

Vierra & Sons (P.J. Vierra) for $500 per month. Petitioner did

not report any of the rental income received from P.J. Vierra.14

In addition to the Boscell property, petitioner held

numerous other real properties for rent. One such property was

located at 4842 Cabrillo Point, Byron, California. This property

was leased to Daniel Parquette. Petitioner received and

deposited rent payments from Daniel Parquette. Other properties

that petitioner owned included those located at and described as:

1300 State Street, 1573 State Street, 1252 State Street, 1243

State Street, Basset Lot (Santa Clara), 1594 Wabash Street, 1598

Wabash Street, 7373 Wells Avenue, 37243 Filbert Street (Lot), and

Liberty Avenue. In addition to the Boscell and 4842 Cabrillo

Point properties, during 1990, 1991, and 1992, petitioner

received and deposited into bank accounts over which he had

signatory authority rental income from the following individuals

and/or entities: Charles and Rose Lamb, Piazza Mobile Sweeping,

BAMA Equipment, Louis and Marion Bewley, James Morrow, Stockton

Semi Trailer, Daniel Parquette, Daniel Estacio, Sines Trucking

Co., Linda Venture, Neil and Betsy Holets, Margaret and Kevin

Deemer, P.J. Vierra & Sons, PSB Trucking, J.S.J. Pipeline, Michel

K. Pipes, Dad’s Enterprises, Linda Venture, Margret or Kevin

14
At trial, petitioner could not explain why the rental
income received from P.J. Vierra was not reported.
 - 12 -

Deemer, and Ricky and Ana Flores. Petitioner claimed deductions

on his Schedules E, Supplemental Income and Loss, for many of

these real properties.

G. Petitioner’s Bank Deposits

During 1990, 1991, and 1992, petitioner deposited

significant sums of money into seven noncorporate bank accounts

over which he had signatory authority.15 The bank accounts were

maintained in the following names: (1) Bank of Milpitas, account

No. 512-001-200593 “George A. Maciel;” (2) Bank of Milpitas,

account No. 512-001-300466 “George A. Maciel c/o Newark Truck &

Body;” (3) Bank of Milpitas, account No. 512-001-303171 “GM

Investments;” (4) Bank of Milpitas, account No. 512-001-102605

“Alviso Rock/HK Racing;” (5) Wells Fargo Bank, account No. 0108-

363904 “George Maciel” and “Peter Viviano;” (6) Wells Fargo Bank,

account No. 0500-325774 “George A. Maciel;” and (7) Wells Fargo

Bank, account No. 6500-059183 “George Maciel.” Generally, these

deposits fall into one of four categories. The first category is

checks made payable to either Alviso or GMT, yet endorsed and

deposited into noncorporate bank accounts over which petitioner

had signatory authority. An example is check No. 35286, made

payable to Alviso for $7,500, the payor of which is Sutter

Insurance Co. and check No. 426 for $13,000 made payable to GMT,

15
The record reflects deposits of more than $1.8 million for
the 3-year period; that is, $715,484.75, $412,514.76, and
$757,186.94, for 1990, 1991, and 1992, respectively.
 - 13 -

the payor of which is Daniel Hernandez. Both of these checks are

made payable to Alviso or GMT yet deposited into Bank of Milpitas

account No. 512-001-300466. The second category represents

workmen’s compensation insurance refund checks made payable to

Alviso or GMT and deposited into noncorporate bank accounts over

which petitioner had signatory authority. For example, on or

about July 31, 1992, Republic Indemnity Co., refunded Alviso

$57,472, which petitioner deposited into Bank of Milpitas account

No. 512-001-300466. The third category is payments made to

petitioner from his related entities. An example of such a

payment is check No. 4153 for $2,476.06 made payable to

petitioner from GMT. Lastly, there are substantial sums of cash

and their equivalent deposited into noncorporate bank accounts

over which petitioner had signatory authority. For example, on

June 19, 1990, petitioner deposited $15,000 in traveler’s checks

into Bank of Milpitas account No. 512-001-300466. Likewise, on

July 18, 24, and 26, 1990, petitioner deposited cash into this

same bank account in the respective amounts of $9,600, $9,700,

and $9,800.

After depositing some of the aforementioned moneys,

petitioner wrote checks to Alviso or GMT noting on the checks

that these payments were loans. For example, on or about

November 19, 1990, Transamerica Insurance Group issued a check

payable to Alviso for $67,256. On December 13, 1990, petitioner
 - 14 -

deposited this check into Bank of Milpitas, account No. 512-001-

300466.16 On that same day, petitioner wrote a check from this

account to GMT for $50,000 and indicated on the memo line “loan

to GMT”. The corporation’s bookkeeper made a handwritten

notation, which reads “Art [the accountant]- George put this

money out of pocket - don’t credit as income. We’re going to pay

our line of credit monthly out of this account, Yvonne” on GMT’s

bank statement for the account into which the $50,000 check was

deposited

Similarly, on or about June 28, 1991, Republic Indemnity Co.

issued GMT a check for $42,887. On July 9, 1991, petitioner

deposited this check into Bank of Milpitas, account No. 512-001-

300466. On that same day, petitioner wrote two checks from this

bank account, one for $30,000 to GMT and one for $10,000 to

Alviso. Petitioner wrote “loan” on the memo line of both checks.

This same treatment occurred with a $57,472 check to Alviso

received from Republic Indemnity Co. Petitioner also deposited

this check into Bank of Milpitas account No. 512-001-300466. On

or about June 4, 1992, petitioner wrote a check to GMT for

$45,000, noting “Loan for Ins.” on the memo line.17

16
Petitioner testified that $17,000 of this money was used
to purchase truck parts from a third party, Peterbilt. The truck
parts were purchased in the name of Newark T&B.
17
Petitioner testified that he was not sure whether by
depositing the Alviso check he was reimbursing himself for a loan
(continued...)
 - 15 -

After making the above-described deposits, Alviso and GMT

booked some of these “loans” as indebtedness owed to petitioner.

The general ledger for Alviso/GMT for the fiscal year ending

November 1992, shows the note payable balance to petitioner as

$105,000, which consists of three of the four checks petitioner

wrote to the corporations and designated as “loans”. The

$105,000 note payable balance consists of the following checks

written on Bank of Milpitas, account No. 512-001-300466:

Date of check Amount Payee Check No.

12/13/90 $50,000 GMT Check
7/9/91 10,000 Alviso 159
6/4/92 45,000 GMT 195

Petitioner testified that the designation “loan” for the

$50,000 check was placed on the check to dissuade his sister from

filing a lawsuit against him questioning his ownership rights to

the businesses. Petitioner testified that he artificially

designated checks as loans to his corporations as a “smoke

screen” to his sister. At trial, petitioner claimed he did not

intend for many of his checks to be designated as loans for which

he was to be repaid.

17
(...continued)
to the corporation for the insurance.
 - 16 -

H. Bank Accounts and Reported Income

During the years at issue, funds were deposited into

noncorporate bank accounts over which petitioner had signatory

authority as follows:18

1. Bank of Milpitas, account No. 512-001-200593,19 in the

name of “George A. Maciel”:

Year Deposits

1990 $105,340.39
1991 106,995.75
1992 94,272.80
2. Bank of Milpitas, account No. 512-001-300466,20 in the

name of “George A. Maciel c/o Newark Truck & Body”:

Year Deposits

1990 $516,524.02
1991 241,243.77
1992 509,494.83

3. Bank of Milpitas, account No. 512-001-303171,21 in the

name of “GM Investments”:

18
Attached hereto and incorporated herein are appendices A,
B, C, D, and E, which detail the described deposits as agreed by
the parties. Additionally, attached hereto and incorporated
herein as appendix F is a stipulated schedule listing nontaxable
deposit items.
19
Appendix A details the deposits made into this bank
account for the years at issue.
20
Appendix B details the deposits made into this bank
account for the years at issue.
21
Appendix C details the deposits made into this bank
account for the years at issue.
 - 17 -

Year Deposits

1991 $49,811.07
1992 121,885.27

4. Bank of Milpitas, account No. 512-001-102605,22 in the

name of “Alviso Rock/HK Racing”:

Year Deposits

1990 $16,811.57
1991 14,397.00
1992 31,493.96

5. Wells Fargo Bank, account No. 0108-363904,23 in the

names of “George Maciel” and “Peter Viviano”:

Year Deposits

1990 $76,463.54

6. Wells Fargo Bank, account No. 0500-325774, in the name

of “George A. Maciel”:

Year Deposits

1990 $4.72

7. Wells Fargo Bank, account No. 6500-059183, in the name

of “George Maciel”:

Year Deposits

1990 $340.51
1991 67.17
1992 40.08

22
Appendix D details the deposits made into this bank
account for the years at issue.
23
Appendix E details the deposits made into this bank
account for the year at issue.
 - 18 -

The parties stipulated the above sums for the years at

issue. Additionally, the parties agreed that the above-described

deposits included $328,286.83, $74,180.81, and $407,639.68 of

nontaxable items for 1990, 1991, and 1992, respectively.24 Thus,

the total deposits and agreed nontaxable deposits25 for the years

at issue were:

1990 1991 1992

Total deposits $715,484.75 $412,514.76 $757,186.94
Nontaxable deposits (328,286.83) (74,180.81) (407,639.68)
Net 387,197.92 338,333.95 349,547.26

The following chart illustrates the total amount and

categories of moneys that petitioner received and reported on his

returns:

1990 1991 1992

Net wages1 $59,642.28 $59,590.17 $54,653.28
Taxable interest 16,872.00 16,131.00 6,595.00
Taxable refunds of state
and local income taxes 3,985.00 1,499.00 --
Gross rents, royalties,
etc. 93,423.00 125,683.00 140,600.00
Other income2 6,000.00 –- –-
Total 179,922.28 202,903.17 201,848.28
1
“Net wages” was calculated by reducing gross wages by Federal income
tax withheld, Social Security tax withheld, and State and local income taxes
withheld.
2
This amount was reported in Statement 1 as “Cabrillo Point” on
petitioner’s 1990 return.

24
See supra note 18.
25
In the stipulation, petitioner reserved the right to
present additional evidence regarding nontaxable items deposited.
 - 19 -

Petitioner also wrote checks made payable to “cash” from his

noncorporate bank accounts over which he had signatory authority.

For example, in 1990, petitioner wrote the following checks to

cash from Bank of Milpitas, account No. 512-001-300466:

Date of Check Check No. Amount

3/20/90 109 $9,645.00
4/17/90 112 9,741.50
4/27/90 118 8,697.50
4/27/90 117 9,750.00
Total 37,834.00

At trial, petitioner could not recall the purpose for, or use of,

these funds.26

I. Petitioner Pled Guilty to Criminal Charges

On September 23, 1998, petitioner was charged with two

counts of knowingly filing false Federal income tax returns for

1991 and 1992 in violation of 26 U.S.C. sec. 7206(1) (2000).27

On January 13, 1999, petitioner entered a guilty plea to the

aforesaid charges and was sentenced to, inter alia, 36 months of

probation. In pleading guilty, petitioner admitted that he

26
Petitioner included copies of the checks as part of his
exhibits. Since petitioner cannot recall for what these amounts
were expended, he is not now claiming them as adjustments to
reconstructed income.
27
In United States of Am. v. George Maciel, case No. 98-
20085-JF, U.S. District Court for the Northern District of
California, petitioner was charged with willfully making a return
he did not believe to be true and accurate; he willfully omitted
the correct amount of income from his return, understating his
income by $78,454 and $75,587 for 1991 and 1992, respectively.
The information alleged he understated his income tax liability
by $19,299 and $10,377 for 1991 and 1992, respectively.
 - 20 -

“willfully” made and signed his 1991 and 1992 individual tax

returns that he “did not believe” [were] “true and correct” [and]

“willfully omitted true and correct information concerning” [his]

“income, knowing then that” he “had additional reportable income”

of $78,454 and $75,587 for 1991, and 1992, and that there was

additional tax due and owing on this additional income of $19,299

and $10,377 for 1991 and 1992, respectively.

J. Significant Events in Petitioner’s Life

Before and during the years at issue, petitioner encountered

a series of stressful events. These events included the

following: Two of his friends/employees died; his and his

girlfriend’s child was stillborn; his friend and financial

adviser broke his neck and became a quadriplegic; his former

brother-in-law died in a motorhome fire outside of petitioner’s

office; he was sued in connection with an accident between one of

petitioner’s trucks and a police officer; and his mother was

diagnosed with lung cancer.

OPINION

Respondent determined that during 1990, 1991, and 1992,

petitioner engaged in a scheme to divert income from his business

activities and thereby failed to report substantial earnings on

his income tax returns in order to fraudulently evade the payment

of tax. Petitioner does not dispute that he underreported

income. Petitioner’s argument centers on his state of mind and
 - 21 -

that “any inaccuracies in his tax returns were caused by

extraordinary stresses and distractions he experienced, not an

intent to evade taxes.” For the reasons detailed below, we

uphold respondent’s deficiency determinations, with some

modifications, and find that petitioner fraudulently intended to

evade the payment of his tax liabilities for 1990, 1991, and

1992.

The first question we address is whether there is a

deficiency. The Commissioner’s determination of tax liability is

presumptively correct, and the taxpayer bears the burden of

showing that the determination is erroneous.28 Zack v.

Commissioner, 692 F.2d 28 (6th Cir. 1982), affg. T.C. Memo. 1981-

700; see DiLeo v. Commissioner, 96 T.C. 858, 871 (1991), affd.

959 F.2d 16 (2d Cir. 1992); Nicholas v. Commissioner, 70 T.C.

1057, 1064 (1978).29

A. The Amount of the Deficiency

1. Unreported Income

Section 61(a) defines gross income as “all income from

whatever source derived”. Every person liable for any tax must

28
“This presumption of accuracy does not change merely
because the case requires a subsidiary inquiry into the question
of fraud.” Zack v. Commissioner, 692 F.2d 28, 29 (6th Cir.
1982), affg. T.C. Memo. 1981-700.
29
Petitioner disputes respondent’s calculations of how much
income he failed to report. He argues also that to the extent he
omitted income, he is entitled to decrease his taxable income by
the amount of unclaimed deductions and adjustments.
 - 22 -

maintain books and records sufficient to establish the amount of

his gross income. Sec. 6001; DiLeo v. Commissioner, supra at

867. The Secretary is authorized to reconstruct income in

accordance with any reasonable method that accurately reflects

actual income. Secs. 446(b), 6001; Petzoldt v. Commissioner, 92

T.C. 661, 687 (1989); Meneguzzo v. Commissioner, 43 T.C. 824, 831

(1965). The reconstruction of a taxpayer’s income need only be

reasonable in light of all surrounding facts and circumstances.

Giddio v. Commissioner, 54 T.C. 1530, 1533 (1970); Schroeder v.

Commissioner, 40 T.C. 30, 33 (1963).

To reconstruct petitioner’s gross income, respondent

utilized both the specific items and bank deposits methods. The

specific items and bank deposits methods of income reconstruction

have long been sanctioned by the courts. Clayton v.

Commissioner, 102 T.C. 632, 645 (1994); Estate of Mason v.

Commissioner, 64 T.C. 651, 656 (1975), affd. 566 F.2d 2 (6th Cir.

1977). “If the taxpayer feels that the Government’s method of

computation is unfair or inaccurate, the burden is on him to show

such unfairness or inaccuracy.” DiLeo v. Commissioner, supra at

871.

(a) Specific Items of Unreported Income From
Petitioner’s Sale of Tri-City Truck Parts
and Newark Wreckers

Petitioner held his interests in Tri-City and Newark

Wreckers under the name M&V Investments. As found above,
 - 23 -

petitioner sold his interest in M&V Investments on April 27,

1990. Respondent calculated petitioner’s income from the sale of

M&V Investments for 1990, using the specific items method of

income reconstruction. To the extent that petitioner deposited

proceeds from this sale to bank accounts over which he had

signatory authority, those deposits were treated as nontaxable in

respondent’s bank deposits analysis.

Respondent calculated petitioner’s basis and gain on the

sale of the interest as follows:

Calculation of Adjusted Basis Newark Wreckers Tri-City
Original cost $25,000 $75,000

Addl. Capital Contributed
or Withdrawn

1987 -- 5,000
1988 -- (5,000)
1989 -- 110,231
1990 -- (2,667)

Petitioner’s Share of Pship. Income/(Loss)

1987 -- (22,603)
1988 -- (78,505)
1989 -- (115,377)
1990 -- (5,881)
1990 (stipulation)1 41,105

Subtotal 25,000 1,303
2
Petitioner’s share of pship. debt 101,000

Adjusted basis 25,000 102,303

Total combined basis 127,303

Calculation of Amount
Description of Item Recognized on Sale

Cash from Viviano $200,000
Relief from pship. debt 101,000
Total amount realized 301,000
Less total basis (127,303)
Amount recognized 173,697
 - 24 -

1
On brief, the parties explained that respondent audited and
initially disallowed all expense deductions for Tri-City’s 1990 taxable
year. The parties stipulated that petitioner’s income inclusion from
Tri-City for 1990 was $41,105.
We agree that this inclusion of income increased petitioner’s
basis. Subch. K of the Code governs basis in a partnership. Sec. 705
details how to calculate basis. Specifically, a partner’s basis in his
partnership interest is increased by, inter alia, the amount of his
distributive share of taxable income. Sec. 705. Thus, to the extent
petitioner recognized additional income as a result of the adjustment to
Tri-City, he is also entitled to an upward adjustment of his basis in
Tri-City. Respondent’s and petitioner’s calculations correctly
incorporate the increase in basis due to the additional income
inclusion.

2
See supra note 5. The inclusion of the “extra” $1,000 is
irrelevant, since it increases the basis and likewise increases the
amount realized.

One difference between petitioner’s and respondent’s

calculation of unreported income from this sale is whether the

inclusion of petitioner’s relief from partnership debt under the

sales agreement should be included as part of the sale proceeds.

We believe that respondent, in contrast to petitioner, correctly

includes, as an amount realized, that portion of the liability of

which petitioner is relieved by virtue of the sales agreement.30

“If a partnership interest is sold or exchanged, the reduction in

the transferor partner’s share of partnership liabilities is

treated as an amount realized under section 1001 and the

regulations thereunder.” Secs. 1.752-1(h), 1.1001-2(a), Income

30
Petitioner argues that respondent incorrectly included
petitioner’s relief from indebtedness as an amount realized in
the sale. It is clear that the amount of the indebtedness from
which petitioner is relieved is included as an amount realized in
the sale transaction, and likewise, petitioner’s basis in
partnership is increased by his proportionate share of the
partnership liability. See secs. 705, 722, 752. Thus, the
amount realized is equally offset by the basis increase.
 - 25 -

Tax Regs. (“the amount realized from a sale or other disposition

of property includes the amount of liabilities from which the

transferor is discharged as a result of the sale or

disposition”).

Petitioner also alleges that he made $56,450 in

loans/advances to Tri-City and Newark Wreckers for which he was

never reimbursed. In support thereof, he introduced copies of

checks made payable to the two entities that he alleges were

unpaid “loans”. Petitioner’s business partner, Thomas Viviano,

testified that each partner would periodically advance/lend funds

to the entities on a short-term basis. There were no formal loan

agreements made between the businesses and their owners. Mr.

Viviano testified that it was the practice of the entities to

immediately payback these “loans” as the entities earned income,

usually within a few months. Petitioner, on the other hand,

testified that at the time he sold his interests to Mr. Viviano,

he was owed $16,200 from Tri-City and $40,250 from Newark

Wreckers.

We find Mr. Viviano to be credible. Tri-City’s 1989 Form

1065 shows that advances from partners went from $62,938 at the

beginning of 1989 to $0 at the beginning of 1990. Thus, we find

petitioner was not owed $16,200 from Tri-City at the time he sold

his interest. Newark Wreckers is a different story. The 1989

and 1990 Forms 1120 for Newark Wreckers show a beginning and an
 - 26 -

ending balance of advances by shareholders of $24,482 and

$36,741, and $36,741 and $117,604, respectively. Petitioner

submitted checks showing payments of $40,250 to Newark Wreckers.

Most of these checks were written well before the sale

transaction and according to Mr. Viviano would have been repaid.

Two of the checks, however, were written on February 21 and March

16, 1990, for $2,500 and $5,000, respectively. Considering Mr.

Viviano’s testimony that the companies repaid shareholder

advances within a few months of borrowing, we find it reasonable

that Newark Wreckers owed petitioner $7,500 at the time of the

sale. Thus, we find that respondent’s determination of

petitioner’s income from this sale should evidence that in 1990,

petitioner was still owed $7,500 from Newark Wreckers. However,

we do not, in light of trial testimony, find it reasonable that

Newark Wreckers owed petitioner the balance, $32,750.

(b). Petitioner’s Income Reconstructed From Bank
Deposits

Bank deposits constitute prima facie evidence of income.

Tokarski v. Commissioner, 87 T.C. 74, 77 (1986). This method of

determining a taxpayer’s income assumes that all the money

deposited into a taxpayer’s bank accounts during a specific

period constitutes taxable income. Price v. United States, 335

F.2d 671, 677 (5th Cir. 1964). Of course, “the Government must

take into account any non-taxable source or deductible expense of

which it has knowledge.” Id. Furthermore, “The fact that the
 - 27 -

Commissioner was not completely correct does not invalidate the

method employed.” DiLeo v. Commissioner, 96 T.C. at 868.

Respondent determined tax deficiencies for 1990, 1991, and

1992 in the respective amounts of $172,655,31 $71,337, and

$56,075. These deficiency amounts are attributable to

respondent’s reconstruction of petitioner’s income for the years

at issue. In utilizing the bank deposits method, respondent

calculated petitioner’s unreported income as follows:32

Bank Acct. Deposits1 1990 1991 1992

Milpitas acct. 200593 $105,340.39 $106,995.75 $94,272.80
Milpitas acct. 300466 516,524.02 241,243.77 509,494.83
Milpitas acct. 102605 16,811.57 14,397.00 31,493.96
Milpitas acct. 303171 -- 49,811.07 121,885.27
Wells Fargo 363904 76,463.54 -- --
Wells Fargo 325774 4.72 -- --
Wells Fargo 059183 340.51 67.17 40.08
Total deposits 715,484.75 412,514.76 757,186.94

Add: Funds Not Deposited

Cash back from deposits
-acct. 200593 1,571.77 -- 500.00
Cash back from deposits
-acct. 300466 14,200.00 $2,887.00 6,500.00
Cash back from deposits
-acct. 102605 -- -- 160.00
Boscell rent deposited
into unknown acct. 62,300.00 61,300.00 --
Total funds avail. 793,556.52 476,701.76 764,364.94

31
See supra page 2.
32
On brief, petitioner admits that because of his criminal
conviction he “is estopped to deny that he willfully omitted
$78,454.00 and $75,587.00 of income from his 1991 and 1992
returns, respectively.”
 - 28 -
Less: Nonincome Items Deposited

Nontaxable deposits2 (328,286.83) (74,180.81) (407,639.68)
Boscell rents
allocable to
Viviano (49,200.00) (22,250.00) --
(377,486.83) (96,430.81) (407,639.68)

Taxable deposits 380,270.95 356,707.26

Less: Deposits Resulting
From Reported Income

Net wages 59,642.28 59,590.17 54,653.28
Interest income 16,872.00 16,131.00 6,595.00
State tax refund 3,985.00 1,499.00 --
Gross rental income 93,423.00 125,683.00 140,600.00
Other income 6,000.00 –- --
Total 179,922.28 202,903.17 201,848.28

Additional unreported
income 236,147.41 177,367.78 154,858.98
1
See appendices A, B, C, D, and E.
2
See appendix F.

In arriving at the above stated figures, respondent used

bank records, including deposit slips and checks showing that

these amounts were deposited into petitioner’s bank accounts.

Generally, petitioner does not dispute these deposits, and

respondent has established, by clear and convincing evidence,

that petitioner underreported his income during the taxable years

at issue. However, petitioner claims that he is entitled to

adjustments in order to determine taxable income. Petitioner

bears the burden of proof to show any adjustments which would

offset unreported income. Barragan v. Commissioner, T.C. Memo.

1993-92, affd. without published opinion 69 F.3d 543 (9th Cir.

1995).
 - 29 -

2. Petitioner’s Adjustments to Unreported Income
Determined by Bank Deposits

In attacking respondent’s income reconstruction, generally,

petitioner argues that he is entitled to adjustments for

unclaimed deductions of expenses and unreimbursed loans/advances

with respect to his various business activities.33 He contends

that these unclaimed adjustments substantially offset the income

that respondent reconstructed.

(a) Petitioner’s Alleged Loans/Advances

Petitioner argues that one of the primary adjustments to the

amount of reconstructed income is unreimbursed loans/advances

that he made to Alviso and GMT.34

Petitioner alleges that when he deposited insurance refund

checks payable to Alviso and GMT into his personal bank accounts,

he transferred portions of those refunds back to those

corporations. While this is true, as far as it goes, petitioner

33
“[I]t is well settled– ‘that evidence of unexplained
receipts shifts to the taxpayer the burden of coming forward with
evidence as to the amount of offsetting expenses, if any.’”
Franklin v. Commissioner, T.C. Memo. 1993-184 (quoting Siravo v.
United States, 377 F.2d 469, 473 (1st Cir. 1967)).
34
However, it appears he was reimbursed for many of these
alleged loans. For example, compare petitioner’s check No. 1086
from Bank of Milpitas, account No. 512-001-200593, dated Dec. 19,
1989, for $999 made payable to “DMV” and GMT’s check No. 3895
dated Dec. 27, 1989, for $1,000 made payable to petitioner which
states on the memo line “Reimburse for DMV fees”. Furthermore,
petitioner’s bookkeeper testified that petitioner’s businesses
customarily repaid such loans. Additionally, petitioner
testified that some of the checks he offered were not loans but
represented his personal expenses.
 - 30 -

characterized the transfers back as “loans” to his corporations.

Petitioner did not report the receipt of the refunds as income,

and because he characterized the transfer of these amounts to the

corporations as loans, they would not be recorded as corporate

income. And given that these transfers were characterized as

loans, petitioner would be entitled to receive these amounts back

from the corporations as nontaxable loan repayments. Under these

circumstances, petitioner is not entitled to reduce his omitted

income by the amounts that he recorded as “loans”.

Petitioner also alleges that he advanced his personal funds

to purchase parts and equipment for use by Alviso or GMT.35 In

support thereof, petitioner provides the Court with photocopies

of checks made from bank accounts over which he had signatory

authority.36 In all, petitioner alleges that during the 3-year

period, he advanced Alviso and GMT more than $120,000 for which

he was never reimbursed. However, according to petitioner’s

brief, he is not absolutely sure of the purposes for some of

35
For example, petitioner claims that in May 1990, he
purchased a hood for $2,000 using his personal American Express
card to pay for it. For support, petitioner presents only a
photocopy of a check for $4,260 made payable to American Express.
Petitioner admitted at trial that he wrote “Hood ? 2000" on the
memo line of the check after the check had cleared his bank.
36
For example, on Aug. 10, 1989, petitioner paid $321 to
“DMV”; on Apr. 8, 1992, he paid $900 to “Rux Onito”; and on Aug.
3, 1992, he paid $1,250 to “Steve Micheles”.
 - 31 -

these expenditures.37 Additionally, some of the copies of checks

that petitioner provided are made payable to “cash” for

significant sums of money.38

Petitioner also alleges that he purchased vehicles for the

benefit of Alviso and GMT with his personal funds for which he

was not reimbursed. However, he fails to provide copies of the

titles or any documentation which would demonstrate in whose

names the alleged vehicles were purchased.

Petitioner provides no evidence that he advanced/lent

substantial amounts of money to Alviso or GMT except copies of

canceled checks and his trial testimony.39 No payee testified as

to these expenditures. There is no evidence of a repayment

schedule, maturity date, special rights and duties of the

parties, written memorialization of the debtor-creditor

relationship, etc. On this record, we find that petitioner

37
On brief, petitioner concedes that, to the extent he does
not know the purpose for the expenditure, he is not now arguing
that such expenditure is an adjustment to reconstructed income.
38
For example, check No. 109 dated Mar. 20, 1990, for
$9,645; check No. 112 dated Apr. 17, 1990, for $9,741.50; check
No. 119 dated Apr. 30, 1990, for $9,847.00; check No. 118 dated
Apr. 27, 1990, for $8,697.50; and check No. 117 dated Apr. 24,
1990, for $9,750.00. Despite providing the Court with copies of
the aforesaid checks, petitioner is now not claiming these checks
represent either advances or any other deductible business
expense.
39
The record indicates that petitioner did not make any such
advances to Alviso or GMT. The balance sheets included with
their 1990, 1991, and 1992 returns list “Loans from Stockholders”
as $0.
 - 32 -

failed to show that these “advances” constituted expenditures

giving rise to bona fide indebtedness. But even if such

expenditures were construed as loans to Alviso or GMT, they would

not be deductible by petitioner or offset his income.

(b) Unclaimed Expenses

Generally, ordinary and necessary expenses paid or incurred

in the carrying on of a trade or business are deductible by such

individual engaged in the trade or business. Sec. 162(a); sec.

1.162-1(a), Income Tax Regs. The expenditure must be “directly

connected with or pertaining to the taxpayer’s trade or

business”. Sec. 1.162-1(a), Income Tax Regs. “The determination

of whether an expenditure satisfies the requirements of section

162 is a question of fact.” Shea v. Commissioner, 112 T.C. 183,

186 (1999). The taxpayer has the burden of proving that he is

entitled to deductions. INDOPCO, Inc. v. Commissioner, 503 U.S.

79, 84 (1992); New Colonial Ice Co. v. Helvering, 292 U.S. 435

(1934).

All deductible expenses are subject to substantiation.

Secs. 274(d), 6001. The general substantiation requirement is

set forth in section 6001 and provides in pertinent part: “Every

person liable for any tax imposed by this title, or for the

collection thereof, shall keep such records * * * and comply with

such rules and regulations as the Secretary may from time to time
 - 33 -

prescribe.”40 The regulations provide that “any person subject

to tax * * * shall keep such permanent books of account or

records, * * * as are sufficient to establish the amount of * * *

deductions”. Sec. 1.6001-1(a), Income Tax Regs.

In the event that a taxpayer establishes that a deductible

expense has been paid, but he is unable to substantiate the

precise amount, the Court may estimate the amount of such

deduction bearing heavily against the taxpayer.41 Cohan v.

Commissioner, 39 F.2d 540, 543-44 (2d Cir. 1930). However, the

Court cannot make such an estimate unless the taxpayer presents

sufficient evidence to provide a reasonable basis upon which the

estimate is made. Vanicek v. Commissioner, 85 T.C. 731, 743

(1985).

(i). Deductibility of Petitioner’s Alleged
Expenses

(A). Newark T&B Expenses

Petitioner claims that no expenses relating to Newark T&B

were claimed as deductions. Petitioner’s argument centers on the

real property he bought to conduct Newark T&B’s business

40
Strict substantiation is required for specific classes of
expenses, including “listed property” described in sec.
280F(d)(4). See sec. 274(d).
41
The Court’s ability to reasonably estimate the amount of a
deduction is curtailed in the case of certain classes of
expenses. Sec. 274(d) limits the Court’s estimating ability.
Sanford v. Commissioner, 50 T.C. 823, 827 (1968), affd. per
curiam 412 F.2d 201 (2d Cir. 1969); see Golden v. Commissioner,
T.C. Memo. 1993-602.
 - 34 -

operations and the expenses that he alleges are associated with

this activity.42 These expenses include, inter alia, telephone

and utility bills. The record shows that petitioner, in

contradiction to his argument, did deduct expenses associated

with this property. For example, petitioner deducted $6,639,

$11,699, and $11,392 in connection with the real property as

listed on Schedule E for his 1990, 1991, and 1992 returns,

respectively. Indeed, petitioner provided no invoices to

substantiate any of the expenses he alleges that he paid on

Newark T&B’s behalf. Furthermore, petitioner failed to offer

evidence that these expenses were paid by Newark T&B and not by

Alviso or GMT.43

(B) Petitioner’s Racing Business

Petitioner also argues that he did not claim as deductions

any expenses associated with his racing business. He alleges

that he incurred expenses of $17,847.23, $15,065.23, and

42
On brief, petitioner claims he is entitled to unspecified
amounts of deductions for depreciation. However, there is
insufficient evidence in the record with which we can calculate
any depreciation to which petitioner might be entitled.
43
“The rule is well established that the failure of a party
to introduce evidence within his possession and which, if true,
would be favorable to him, gives rise to the presumption that if
produced it would be unfavorable.” Wichita Terminal Elevator Co.
v. Commissioner, 6 T.C. 1158, 1165 (1946), affd. 162 F.2d 513
(10th Cir. 1947). “This is especially true where, as here, the
party failing to produce the evidence has the burden of proof or
the other party to the proceeding has established a prima facie
case.” Id.
 - 35 -

$30,283.07 for 1990, 1991, and 1992, respectively. In support

thereof, petitioner proffers copies of checks from the “Alviso

Rock/HK Racing” bank account, copies of bank account statements,

and invoices. No one other than petitioner testified about this

endeavor or the purported expenses. From the evidence provided,

we are unable to determine whether the expenses detailed in the

invoices were for the benefit of petitioner’s racing business or

for one of his related businesses. Nearly all the invoices are

made to “Alviso Rock”.

(ii). Petitioner Does Not Sustain His Adjustments
to Reconstructed Income

We are unable to sustain petitioner’s alleged unclaimed

expense deductions to the income that respondent reconstructed.

Petitioner fails to provide sufficient evidence to support the

expense deductions he claims for the years at issue. Petitioner

failed to offer the testimony of any of the payees of his checks

to support his allegations. The only evidence he has provided

are photocopies of checks, some invoices, and his trial

testimony. We find petitioner’s testimony self-serving, vague,

and not persuasive. “It is well settled that we are not required

to accept petitioner’s self-serving testimony in the absence of

corroborating evidence.” Jacoby v. Commissioner, T.C. Memo.

1994-612 (citing Lerch v. Commissioner, 877 F.2d 624, 631-632

(7th Cir. 1989), affg. T.C. Memo. 1987-295); see Geiger v.

Commissioner, 440 F.2d 688, 689 (9th Cir. 1971), affg. per curiam
 - 36 -

T.C. Memo. 1969-159; Niedringhaus v. Commissioner, 99 T.C. 202,

212 (1992); Tokarski v. Commissioner, 87 T.C. at 77 (“Under all

the circumstances, we are not required to accept the self-serving

testimony of petitioner”).

Furthermore, we are unable, given the record before us, to

determine which expenses are associated with which business

activity, be it petitioner’s corporations or his unincorporated

businesses. The record unequivocally demonstrates that

petitioner failed to follow and respect business formalities.

Instead, the record evidences the inflows and outflows of

substantial sums of money by and between petitioner and his

related businesses. The books and records of petitioner’s

affiliated corporations and businesses were not offered as

evidence.44

3. Taxable Income and Earnings and Profits

Petitioner argues, for the first time on brief, that

respondent failed to demonstrate that there were sufficient

earnings and profits (E&P) to deem funds that petitioner received

from GMT and Alviso as taxable dividends.45 Additionally,

44
For example, the invoices that petitioner submitted in
support of his entitlement to deductions for expenses associated
with his racing business are made to “Alviso”. Without the books
and records of Alviso, it is impossible to determine if these
invoices represent expenses of Alviso, for which deductions have
already been taken.
45
“This Court generally will not consider issues that are
(continued...)
 - 37 -

petitioner alleges that respondent failed to demonstrate that any

amounts received from Alviso and GMT exceeded his basis therein.

Generally, gross income includes net accessions to wealth

from whatever source derived. Sec. 61; Han v. Commissioner, T.C.

Memo. 2002-148 (citing Commissioner v. Glenshaw Glass Co., 348

U.S. 426, 431 (1955)). Section 301, however, places a

restriction on the definition of gross income. Barnard v.

Commissioner, T.C. Memo. 2001-242. Generally, that section

provides that funds distributed by a corporation over which the

shareholder has dominion and control are taxed under the auspices

of section 301(c). Id. Pursuant to section 301(c), a

constructive dividend46 is taxed as ordinary income only to the

45
(...continued)
raised for the first time on brief, particularly where the
belated claim would prejudice a party.” Han v. Commissioner,
T.C. Memo. 2002-148; Rules 34(b)(4), 41(a) and (b); Foil v.
Commissioner, 92 T.C. 376, 418 (1989), affd. 920 F.2d 1196 (5th
Cir. 1990); Markwardt v. Commissioner, 64 T.C. 989, 997 (1975);
see also Bob Wondries Motors, Inc. v. Commissioner, 268 F.3d 1156
(9th Cir. 2001), affg. Toyota Town, Inc. v. Commissioner, T.C.
Memo. 2000-40. This Court has held on numerous occasions that it
will not consider issues not pleaded. See, e.g., Estate of
Mandels v. Commissioner, 64 T.C. 61 (1975); Estate of Horvath v.
Commissioner, 59 T.C. 551, 556 (1973); Frentz v. Commissioner, 44
T.C. 485, 491 (1965), affd. 375 F.2d 662 (6th Cir. 1967).
46
“The crucial concept in a finding that there is a
constructive dividend is that the corporation has conferred a
benefit on the shareholder in order to distribute available
earnings and profits without expectation of repayment.”
Truesdell v. Commissioner, 89 T.C. 1280, 1295 (1987) (citing
Noble v. Commissioner, 368 F.2d 439, 443 (9th Cir. 1966), affg.
T.C. Memo. 1965-84).
 - 38 -

extent of the distributing corporation’s E&P;47 any excess is

nontaxable return of capital to the extent of the taxpayer’s

basis; and any remaining amount received is taxable as capital

gain from the sale or exchange of a capital asset. Sec.

301(c)(1),(2), and (3); Truesdell v. Commissioner, 89 T.C. 1280,

1295-1298 (1987); Barnard v. Commissioner, supra.

“It is well established that when controlling shareholders

divert corporate income to themselves, it is proper to treat such

diverted funds as constructive dividends for tax purposes.”

DiLeo v. Commissioner, 96 T.C. at 883. As stated more fully

above, the Commissioner’s deficiency determination is

presumptively correct, and the taxpayer bears the burden of

showing that determination is erroneous. See Rule 142(a); Zack

v. Commissioner, 692 F.2d 28 (6th Cir. 1982); DiLeo v.

Commissioner, supra at 871. Respondent’s deficiency

determination included those amounts diverted from Alviso and

GMT. Under these circumstances, petitioner bears the burden of

showing that Alviso and GMT did not have sufficient E&P to deem

the subject “distributions” to be constructive dividends.

DiZenzo v. Commissioner, 348 F.2d 122, 125-127 (2d Cir. 1965)

(burden is on taxpayers to establish corporation did not have

sufficient E&P), revg. T.C. Memo. 1964-121; Truesdell v.

47
The determination of earnings and profits is governed by
sec. 316 and the regulations promulgated thereunder.
 - 39 -

Commissioner, supra; Zalewski v. Commissioner, T.C. Memo. 1988-

340; Delgado v. Commissioner, T.C. Memo. 1988-66; see Price v.

United States, 335 F.2d at 677 (“It is the burden of the taxpayer

to demonstrate a non-taxable source for this cash.”). Here,

petitioner failed to provide any proof that Alviso and GMT did

not have sufficient E&P to determine the distributions as

taxable, constructive dividends. Likewise, petitioner offered no

evidence of his adjusted bases.48

Accordingly, we find that petitioner has untimely raised the

E&P and basis issues and, otherwise, has failed to meet his

burden.49

4. Respondent’s Deficiency Determinations Are Not Erroneous

48
In United States v. Miller, 545 F.2d 1204, 1215 (9th Cir.
1976), the court explained:

In holding that the constructive distribution
should not automatically be applied, it is not
herein asserted that diverted funds could never be
a return of capital. However, to constitute the
latter, there must be some demonstration on the
part of the taxpayer and/or the corporation that
such distributions were intended to be such a
return. To hold otherwise would be to permit the
taxpayer to divert such funds and if not caught,
to later pay out another return of capital; or if
caught, to avoid the conviction by raising the
defense that the sums were a return of capital and
hence non-taxable.
49
Additionally, petitioner failed to demonstrate that the
distributions from his wholly owned corporations and employers
were not additional remuneration for the management services he
provided. The record reflects that Alviso and GMT each paid
petitioner a salary during the years at issue.
 - 40 -

We find that respondent has produced substantial evidence

demonstrating that petitioner received unreported income.

Delaney v. Commissioner, 743 F.2d 670, 671 (9th Cir. 1984), affg.

T.C. Memo. 1982-666; see Bradford v. Commissioner, 796 F.2d 303,

305 (9th Cir. 1986), affg. T.C. Memo. 1984-601. Furthermore, we

find that petitioner has failed to establish by a preponderance

of the evidence that respondent’s determinations were arbitrary

or erroneous. Rapp v. Commissioner, 774 F.2d 932, 935 (9th Cir.

1985), Larsen v. Commissioner, 765 F.2d 939, 941 (9th Cir. 1985);

Delaney v. Commissioner, supra at 671. Accordingly, we sustain,

subject to the aforesaid50 and the concessions of the parties,

respondent’s deficiency determinations for the years herein at

issue.

B. Fraud Penalties

The Commissioner bears the burden of proving by clear and

convincing evidence that an “underpayment exists for the years in

issue and that some portion of the underpayment is due to fraud.”

Temple v. Commissioner, T.C. Memo. 2000-337 (citing sec. 7454(a),

Rule 142(b); Niedringhaus v. Commissioner, 99 T.C. at 210), affd.

62 Fed. Appx. 605 (6th Cir. 2003); see Baumgardner v.

Commissioner, 251 F.2d 311 (9th Cir. 1957), affg. T.C. Memo.

50
As previously stated, the computation under Rule 155 shall
evidence that petitioner was owed $7,500 from Newark Wreckers.
See supra page 26.
 - 41 -

1956-112; Hebrank v. Commissioner, 81 T.C. 640, 642 (1983).

Thus, respondent must establish that petitioner underpaid his

taxes for each year in issue and that some part of the

underpayment for each year is due to fraud. DiLeo v.

Commissioner, supra at 873.

1. Clear and Convincing Evidence of Underpayment

“To prove an underpayment, the Commissioner is not required

to establish the precise amount of the deficiency determined by

him.” Id.; see Otsuki v. Commissioner, 53 T.C. 96, 105 (1969).

“However, he cannot discharge his burden by simply relying on the

taxpayer’s failure to prove error in his determination of the

deficiency.” DiLeo v. Commissioner, supra at 873. The

Commissioner need only establish that the taxpayer received

unreported income and that the nondisclosure resulted in a tax

deficiency. United States v. Campbell, 351 F.2d 336, 338 (2d

Cir. 1965); Elwert v. United States, 231 F.2d 928, 931 (9th Cir.

1956); United States v. Bender, 218 F.2d 869, 871-72 (7th Cir.

1955); Langworthy v. Commissioner, T.C. Memo. 1998-218.

When the allegations of fraud are intertwined with

unreported and indirectly reconstructed income, the Commissioner

can satisfy his burden of proving the underpayment in one of two

ways: (1) By proving a likely source of the unreported income;

or (2) where the taxpayer alleges a nontaxable source, the

Commissioner may meet his burden by disproving the taxpayer’s
 - 42 -

alleged nontaxable source. DiLeo v. Commissioner, supra at 873-

874. In this case, there is no question of the origin of the

unreported income. The parties have also agreed that some

deposits were from nontaxable sources. Petitioner admits on

brief that he willfully omitted $78,454 and $75,587 of income

from his 1991 and 1992 returns. In his written guilty plea in

his criminal case, petitioner admitted that he willfully omitted

reportable income of $78,454 and $75,587 and that there was

additional tax due on this omitted income of $19,299 and $10,377

for 1991 and 1992, respectively. And, as previously explained,

there is clear and convincing evidence that he failed to report

additional amounts of income for each of the years at issue.

During the 3-year period at issue, more than $1.8 million

flowed through his bank accounts. Petitioner does not dispute

this, but instead argues that much of this money is nontaxable

reimbursements for moneys advanced to and/or expenses incurred

for the benefit of his various business activities. When bank

deposits make out a prima facie case of underreported income, the

taxpayer has the burden of proving additional expenses that he

did not claim on his returns. Morse v. Commissioner, T.C. Memo.

2003-332 (citing Siravo v. United States, 377 F.2d 469, 473-474

(1st Cir. 1967); Elwert v. United States, supra at 933). As

previously explained, petitioner has failed to do so.
 - 43 -

There is also clear and convincing evidence that petitioner

failed to report substantial income from the sale of his interest

in Tri-City and Newark Wreckers in 1990.

Accordingly, we are convinced that respondent has proven by

clear and convincing evidence that petitioner underpaid his

income taxes due and owing for the years at issue.

2. Intent To Defraud

As previously explained, the Commissioner bears the burden

of proving fraud by clear and convincing evidence. Sadler v.

Commissioner, 113 T.C. 99, 102 (1999); Posnanski v. Commissioner,

T.C. Memo. 2001-26; see Henson v. Commissioner, 887 F.2d 1520

(11th Cir. 1989), affg. in part and revg. in part on another

ground T.C. Memo. 1986-303; Temple v. Commissioner, supra.

“Where fraud is determined for each of several years,

respondent’s burden applies separately for each of the years.”

Temple v. Commissioner, supra; see Cefalu v. Commissioner, 276

F.2d 122 (5th Cir. 1960), affg. T.C. Memo. 1958-37; Baumgardner

v. Commissioner, supra.

“Fraud is the intentional wrongdoing on the part of a

taxpayer to evade a tax believed to be owing.” Temple v.

Commissioner, supra; see DiLeo v. Commissioner, 96 T.C. at 874;

Prof. Serv. v. Commissioner, 79 T.C. 888, 930 (1982). “The

required state of mind is one which, ‘if translated into action,

is well calculated to cheat or deceive the government.’” Zell v.
 - 44 -

Commissioner, 763 F.2d 1139, 1143 (10th Cir. 1985), affg. T.C.

Memo. 1984-152 (quoting 10 Mertens, Law of Federal Income

Taxation, sec. 55.10, at 46 (1984)). A taxpayer’s background and

the context of the events in question may be considered in

determining fraudulent intent. Plunkett v. Commissioner, 465

F.2d 299 (7th Cir. 1972), affg. T.C. Memo. 1970-274; see Temple

v. Commissioner, supra (a taxpayer’s level of education and his

prior history of filing income tax returns are relevant to the

inquiry).

Because it is difficult to prove fraudulent intent by direct

evidence, fraud can be inferred from various kinds of

circumstantial evidence. Courts describe these “badges of fraud”

as including the following: (1) Understatement of income;51 (2)

failing to maintain adequate records; (3) failure to file tax

returns; (4) implausible or inconsistent explanations; (5)

concealment of assets; (6) failure to cooperate with tax

authorities; (7) the filing of false documents; (8) making of

false and inconsistent statements to revenue agents; (9)

concealing income from a taxpayer’s tax preparer; and (10)

51
“The consistent understatement of large amounts of income
for a number of years is evidence of willful intent to evade.”
Otsuki v. Commissioner, 53 T.C. 96, 108 (1969). In Holland v.
United States, 348 U.S. 121, 139 (1954), “the Supreme Court
declared that ‘evidence of a consistent pattern of underreporting
large amounts of income’ will support ‘an inference of
willfulness’”. Otsuki v. Commissioner, supra at 108.
 - 45 -

extensive dealings in cash. Bradford v. Commissioner, 796 F.2d

at 307; Parks v. Commissioner, 94 T.C. 654, 664 (1990); Temple v.

Commissioner, T.C. Memo. 2000-337. No single factor is

necessarily dispositive, but a combination of several factors is

persuasive circumstantial evidence of fraud. Petzoldt v.

Commissioner, 92 T.C. at 699. “A pattern of consistent

underreporting of income, particularly when accompanied by other

circumstances exhibiting an intent to conceal, justifies the

inference of fraud.” Posnanski v. Commissioner, supra; see

Holland v. Commissioner, 348 U.S. 121, 137 (1954).

Petitioner consistently underreported large sums of money.

See Marcus v. Commissioner, 70 T.C. 562, 577 (1978), affd.

without published opinion 621 F.2d 439 (5th Cir. 1980).

Petitioner’s failure to substantiate adequately his alleged

advances and expenses makes it impossible to verify his

allegations. This Court has found in a similar case that the

“inadequacy of petitioners’ records, under the circumstances,

constitutes a significant indicia of fraud.” Otsuki v.

Commissioner, 53 T.C. at 110 (citing Galant v. Commissioner, 26

T.C. 354, 365 (1956)).

Petitioner cannot rely upon events that occurred in his life

before, during, and after the relevant periods in issue. While

we are sympathetic with petitioner’s personal problems, we cannot

condone his failure to report significant sums of income over a
 - 46 -

3-year period merely because his mind was not on business.52 We

find petitioner’s defense of personal tragedy misplaced.

Petitioner was sufficiently focused and cognizant to, inter alia,

open and operate numerous businesses during the relevant period,

engage in significant investment activities, engage the

assistance of trained accounting professionals, and earn and

deposit significant sums of money into his numerous bank

accounts.

In support of our finding of fraud, we outline pertinent

portions of the record:

(1) Petitioner sold his interest in Tri-City and Newark

Wreckers for which he received $200,000 and was relieved of

substantial indebtedness. To this day, petitioner has failed to

report this transaction.53

52
In Otsuki v. Commissioner, supra at 110, the taxpayer
advanced, and we rejected a similar argument. The taxpayer was
too busy and too tired to maintain adequate business records.
53
Petitioner admits on brief, that he failed to report a net
gain from the sale of between $17,247 and $118,247. This, of
course, is after inclusion of $41,105 in additional income for
1990, which accordingly, increased his basis in the Tri-City
partnership. Thus, before respondent’s examination and
redetermination of Tri-City’s 1990 income, it was reasonable for
petitioner to assume that he had substantially more net gain (at
least $41,105 more) from the sale of Tri-City, which he never
reported.

Petitioner seeks solace in a statement that his accountant
prepared, which he attached to his 1990 return. We find this
statement, given the specific circumstances of this case, at the
(continued...)
 - 47 -

(2) Petitioner diverted substantial amounts of money from

his related corporations, Alviso and GMT. To hide the character

of these funds petitioner gave a portion of these diverted funds

back to his corporations, labeling those funds as loans. To that

end, petitioner purposely misled his accountants as to the true

nature of these funds. For example, on one of GMT’s bank

statements for the account into which a $50,000 check was

deposited, there is a handwritten notation that the corporation’s

bookkeeper made which reads “Art [the accountant]- George put

this money out of pocket - don’t credit as income. We’re going

to pay our line of credit monthly out of this account, Yvonne.”

(3) Petitioner garnered significant funds over a 3-year

period from his solely owned, unincorporated business Newark T&B,

and he failed to report any income earned therefrom. Petitioner

characterized this endeavor on his income tax returns Schedules E

as a “lot”. Furthermore, petitioner failed to maintain proper

books and records for this business.

(4) Petitioner maintained an automobile racing business,

which also earned him substantial sums of income. Again,

53
(...continued)
very least vague and ill-informing. This statement speaks only
to petitioner’s inability “TO REPORT HIS SHARE OF THE
PARTNERSHIP’S ACTIVITY FOR THE 1990 TAX YEAR.” The statement
does not communicate that in 1990 petitioner received at least
$300,000 of value in exchange for his interest, a transaction
which is clearly not a “partnership activity”. Furthermore, the
statement refers only to Tri-City and not to Newark Wreckers.
 - 48 -

petitioner failed to report any of these earnings or maintain

adequate books and records for this business.

(5) Petitioner owned and operated for income and investment

at least 12 parcels of real property. Although petitioner

apparently did report much of the income he received from these

properties, he failed to report all the income. When questioned

about this failure, petitioner explained: “I just don’t really

have an explanation.” However, petitioner did claim expense

deductions for these properties. Again, petitioner failed to

maintain adequate books and records for this significant business

endeavor.

(6) During the relevant period, petitioner dealt in

significant sums of cash or its equivalent for which he has no

explanation. For example, during 1990, petitioner wrote four

checks made payable to cash for the total sum of $37,834. At

trial, petitioner could not recall the purpose for, or use of,

these funds. Likewise, petitioner deposited large sums of cash

and its equivalent into his bank accounts. We infer significant

dealings in cash without a definite explanation as an indicia of

fraud. See Parks v. Commissioner, 94 T.C. 654 (1990).

(7) Petitioner failed to inform his accountants (and his

bookkeeper) of Newark T&B and his racing business. Both of these

businesses earned income for the years at issue, none of which

was reported.
 - 49 -

(8) Petitioner’s admission that he purposely mislabeled

checks to his corporation as loans is also evidence of his

willingness to defraud. See Solomon v. Commissioner, 732 F.2d

1459 (6th Cir. 1984), affg. T.C. Memo. 1982-603; Afshar v.

Commissioner, 692 F.2d 751 (4th Cir. 1982), affg. without

published opinion T.C. Memo. 1981-241.

The record before the Court clearly and convincingly

demonstrates a pattern of consistent underreporting of income.

The record clearly and convincingly shows that petitioner

intentionally concealed significant business operations from his

accountants and bookkeeper. Petitioner’s vague testimony

buttresses our finding. There can be little doubt that

petitioner’s failure to keep adequate records of all earnings and

expenses is material evidence of fraud. See Otsuki v.

Commissioner, 53 T.C. at 109. “To hold otherwise would, as the

Supreme Court stated in United States v. Johnson, 319 U.S. 503,

518 (1943) ‘be tantamount to holding that skillful concealment is

an invincible barrier to proof.’” Id. at 109. The insufficiency

of petitioner’s records, under these circumstances, constitutes a

significant indicia of fraud. Id. at 110.

3. Petitioner’s Conviction and Collateral Estoppel

We find petitioner’s guilty plea of knowingly filing false

returns for 1991 and 1992 is additional evidence, which ensures

us that the imposition of the fraud penalty in this case is
 - 50 -

justified.54 In his written guilty plea, petitioner admitted

that he “willfully” made and signed his 1991 and 1992 individual

tax returns that he “did not believe” [were] “true and correct”

[and] “willfully omitted true and correct information concerning”

[his] “income, knowing then that” he “had additional reportable

income” of $78,454 and $75,587 for 1991, and 1992, and that there

was additional tax due and owing on this additional income of

$19,299 and $10,377 for 1991 and 1992, respectively.

Petitioner’s conviction for filing false tax returns for

1991 and 1992, although not dispositive of the fraud issue, is a

factor to be considered in determining fraud. See Wright v.

Commissioner, 84 T.C. 636, 643-44 (1985). Petitioner admits that

he is estopped to deny that he willfully omitted $78,454 and

$75,587 of income for 1991 and 1992, respectively, but contends

that he is not estopped to deny the fraud penalty for those

years. Petitioner concedes that his conviction is relevant

evidence on the issue of fraud.

The doctrine of collateral estoppel precludes the

relitigation of any issue or fact that was actually litigated and

necessarily determined by a valid and final judgment. Peck v.

Commissioner, 90 T.C. 162 (1988), affd. 904 F.2d 525 (9th Cir.

1990); Wright v. Commissioner, supra at 639; Wilson v.

54
On brief, petitioner agrees that his “conviction for 1991
and 1992 may be considered relevant on the issue of fraud.”
 - 51 -

Commissioner, T.C. Memo. 2002-234. Of course, this doctrine

“must be confined to situations where the matter raised in the

second suit is identical in all respects with that decided in the

first proceeding and where the controlling facts and applicable

legal rules remain unchanged.” Commissioner v. Sunnen, 333 U.S.

591, 599-600 (1948). “A prior conviction will estop a party from

contesting in a later civil suit any element necessarily

established in the criminal trial.”55 Considine v. United

States, 683 F.2d 1285, 1286 (9th Cir. 1982).

As the Court of Appeals for the Ninth Circuit concluded, the

intent to avoid tax under section 7206(1) and the filing of a

false return does not require a fraudulent intent. Id. at 1287;

see Wright v. Commissioner, supra at 641 (overruling a Tax Court

decision and following the Court of Appeals’ holding and

reasoning in Considine). “Because section 7206(1) does not

require a willful attempt to evade tax, a conviction under

section 7206(1), without more, does not establish fraudulent

intent.”56 Considine v. United States, supra at 1287. However,

55
“[T]he question is whether the issue under section 6653(b)
is ‘identical in all respects’ to that decided under section
7206(1).” Wright v. Commissioner, 84 T.C. 636, 639 (1985).
56
The Court of Appeals for the Ninth Circuit did determine
that the prior conviction did estop the taxpayer from contesting
that the return was willfully false and resulted in an
underpayment of tax; proof of falsity is a necessary element of
sec. 7206(1). Considine v. United States, 683 F.2d 1285, 1287
(continued...)
 - 52 -

“a conviction for willful falsification, under section 7206(1),

while not dispositive, will be one of the facts to be considered

in a trial on the merits.” Wright v. Commissioner, supra at 643-

644 (emphasis added).

Petitioner argues that comments the judge made during his

criminal sentencing colloquy are “highly persuasive” to whether

he fraudulently evaded the payment of taxes. We disagree with

petitioner’s argument that statements the judge made during his

criminal sentencing hearing are in some way persuasive on the

issue of whether petitioner fraudulently evaded the payment of

tax.57 See N.Y. v. Julius Nasso Concrete Corp., 202 F.3d 82 (2d

56
(...continued)
(9th Cir. 1982).
57
Judge Fogel stated:

But I don’t think the conduct looked at in its
totality suggests that the reason * * *
[petitioner] diverted the money was to avoid
paying money to the Internal Revenue Service. I
think that’s the finding that the Court would have
to make. So I think we’re looking at the lower of
the two [sentencing] calculations.

* * * * * * *

The Court has considered the entire 1990, 1991,
1992, but that there is no intent to evade that’s
established convincingly by the record. So I
would find this is a [sentencing] guideline level
6 which gives the Court an opportunity or gives
the Court the discretion, rather, to impose
anywhere from zero to six months incarceration.
 - 53 -

Cir. 2000); SEC v. Monarch Funding Corp., 192 F.3d 295 (2d Cir.

1999); United States v. Barnette, 10 F.3d 1553 (11th Cir. 1994).

We do not know what evidence that court had before it when making

those comments. Suffice it to say, the record in this case

clearly and convincingly leads us to the conclusion that

petitioner intended to fraudulently evade the payment of his

taxes for 1990, 1991, and 1992.

Petitioner also argued that assessment is barred by section

6501(a), as the period of limitations for assessing tax had

expired. Since we have held that respondent has established by

clear and convincing evidence that petitioner underpaid his tax

liabilities for 1990, 1991, and 1992 and that such underpayments

were due to fraud, the statute of limitations does not bar

respondent’s assessment and collection activities. See sec.

6501(c)(1); Plunkett v. Commissioner, 465 F.2d 299 (7th Cir.

1972), affg. T.C. Memo. 1970-274; DiLeo v. Commissioner, 96 T.C.

at 880.

Decision will be entered

under Rule 155.
 - 54 -
APPENDIX “A”

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Deposit Check

Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
01/03/90 $6,182.32 $6,182.32 Unknown
01/11/90 $9,737.66 01/05/90 1304 $349.66 BAMA Equipment Parts Payable: Alviso Rock
01/02/90 17156 $8,400.00 P.S.B. Trucking Inc.
01/03/90 816 $200.00 Louis W. & Marion E. Bewley
01/08/90 1616 $550.00 Piazza Mobil Sweeping Yard Rent
01/03/90 61526 $238.00 American Business Ins. Brokers Payable: Gerald E. Waller
01/26/90 $4,674.66 01/09/90 825 $200.00 Louis W. & Marion E. Bewley
Rent 1-22-90 thru
01/18/90 3187 $1,450.00 Neil & Betsy Holets 2-22-90
1/22/90 839 $200.00 Louis W. & Marion E. Bewley
01/12/90 5624 $25.00 Tri City Truck Parts and Equip Refund Straight line
01/25/90 5583 $300.00 Alviso Rock Inc.
01/12/90 1311 $349.66 BAMA Equipment Parts Payable to Alviso Rock
01/24/90 4096 $2,150.00 George Maciel Trucking Inc. Re: ???
Feb Rent-Balance of
02/14/90 $5,450.00 02/01/90 1036 $250.00 Daniel Parquette Account
02/07/90 376 $500.00 James Morrow
02/06/90 19288 $200.00 Marion Bewley Money Order
02/06/90 9014592 $4,500.00 Taco Bravo Cashiers Check
02/28/90 $1,000.00 $0.00 Correction of 2/28/90 Deposit
02/28/90 $7,248.22 02/21/90 860 $600.00 Louis W. & Marion E. Bewley
02/10/90 3220 $1,450.00 Neil & Betsy Holets 2/22/90-3/22/90
02/16/90 309695 $4,380.14 State Farm Mutual Auto Ins Payable: Alviso Rock Inc.
02/09/90 326862 $1,818.08 State Farm Mutual Auto Ins Payable: Alviso Rock
03/08/90 $7,346.21 03/03/90 1053 $459.00 Daniel Parquette Mar Rent
03/06/90 8122797 $1,936.02 California Land Title Co. Escrow 284613-LM
03/02/90 34428 $1,150.00 South Bay Transportation
03/01/90 10194 $2,451.53 Alviso Rock Inc.
03/02/90 1360 $349.66 BAMA Equipment Parts
 - 55 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Deposit Check

Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
03/06/90 1366 $600.00 BAMA Equipment March Rent
03/06/90 889 $400.00 Louis W. & Marion E. Bewley
03/16/90 $1,752.00 83508 $2.00 Revlon Beauty Care
03/11/90 900 $200.00 Louis W. & Marion E. Bewley
03/08/90 1678 $550.00 Piazza Mobil Sweeping Rent Yard
03/14/90 1370 $1,000.00 BAMA Equipment
04/04/90 $3,474.10 04/03/90 1412 $1,000.00 BAMA Equipment
03/29/90 2294 $2,474.10 George Maciel Trucking Inc.
04/17/90 $1,917.87 04/05/90 429 $18.25 James Morrow Phone Bill
04/11/90 130 $75.74 Daniel Estacio PGE
04/12/90 939 $200.00 Louis W. & Marion E. Bewley
04/05/90 927 $200.00 Louis W. & Marion E. Bewley
04/09/90 1707 $550.00 Piazza Mobil Sweeping Yard Rent
04/05/90 8123340 $873.88 California Land Title Co. Escrow 287641-LM
04/30/90 $7,528.49 04/20/90 3286 $1,450.00 Neil & Betsy Holets 4/22 thru 5/22
04/23/90 957 $400.00 Louis W. & Marion E. Bewley
04/19/90 22834 $109.39 Saratoga Savings & Loan Assoc
04/20/90 8123737 $44.42 California Land Title Co. Escrow 284613-LM
04/09/90 418767 $28.95 Fireman's Fund
03/14/90 415163 $393.00 Fireman's Fund
04/18/90 62372 $154.53 American Business Ins. Brokers
04/26/90 10322 $2,474.10 Alviso Rock Inc.
04/26/90 2427 $2,474.10 George Maciel Trucking Inc.
06/19/90 $1,918.45 06/16/90 490 $650.00 James Morrow Rent
06/12/90 1016 $200.00 Louis W. & Marion E. Bewley
06/06/90 1010 $200.00 Louis W. & Marion E. Bewley
06/14/90 2678 $386.02 George Maciel Trucking Inc. Payable to Daniel B. Estacio
06/14/90 2673 $182.43 George Maciel Trucking Inc. Payable to Gary Whiteman
06/12/90 375 $300.00 Analytical Maintenance Service Rent
07/02/90 $3,175.29 06/18/90 1026 $200.00 Louis W. & Marion E. Bewley
 - 56 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Deposit Check

Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
06/05/90 1132 $500.00 Daniel Parquette June Rent
11572 $1.19 Proctor & Gamble Refund
06/28/90 1149 $2,474.10 Alviso Rock Inc.
07/10/90 $876.47 07/03/90 1145 $326.47 Daniel Parquette July Rent AC Repair
07/06/90 1846 $550.00 Piazza Mobil Sweeping Yard Rent
07/18/90 $1,850.00 07/06/90 1045 $200.00 Louis W. & Marion E. Bewley
07/16/90 528 $650.00 James Morrow Rent
07/17/90 10074 $1,000.00 Bill's Trucking Inc. Payable: Newark Truck & Body
08/06/90 $5,878.36 07/26/90 2884 $2,503.80 George Maciel Trucking Inc.
07/31/90 1230 $2,474.56 Alviso Rock Inc.
248 $500.00 Daniel Parquette Aug Rent
07/26/90 445 $400.00 Rex A. Hill
08/15/90 $5,263.73 08/13/90 1640 $600.00 BAMA Equipment August Rent
08/08/90 1870 $550.00 Piazza Mobil Sweeping
08/10/90 1071 $200.00 Louis W. & Marion E. Bewley Rent
08/04/90 1063 $200.00 Louis W. & Marion E. Bewley Rent
08/08/90 71088335 $113.73 American Express Travel Payable: Tri-City Truck Parts
08/13/90 6911 $1,600.00 Curt Biro Trucking Sleeper Payable: Newark Truck & Body
08/06/90 4649 $1,000.00 Taco Bravo
08/13/90 1641 $1,000.00 BAMA Equipment
Payable: George Maciel
08/17/90 $1,571.77 07/31/90 63618 $3,143.54 American Business Ins. Brokers Trucking Inc
$(1,571.77) Less Cash $(1,571.77)
08/27/90 $150.00 $0.00 Correction of 8/27/90 Deposit
08/27/90 $2,720.00 08/17/90 557 $650.00 James Morrow Rent
08/20/90 986 $1,000.00 Joyce Lavrar/Terence Perry Thanks
Rent 8-20-90 to
08/21/90 1135 $720.00 J.S.J. Pipeline Co. 10-30-90
08/22/90 8945 $500.00 Richard Moneymaker Lowbed Payable: Newark Truck & Body
09/07/90 $5,423.00 08/30/90 3090 $2,506.50 George Maciel Trucking Inc.
08/30/90 1329 $2,506.50 Alviso Rock Inc.
08/03/90 766199 $10.00 Fireman's Fund
 - 57 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Deposit Check

Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
08/17/90 1081 $200.00 Louis W. & Marion E. Bewley Rent
08/24/90 1082 $200.00 Louis W. & Marion E. Bewley Rent
09/14/90 $2,070.74 09/05/90 1124 $2,000.00 Merced Rosales
09/13/90 1202 $70.74 Mission Valley Diesel
09/25/90 $1,214.32 09/14/90 1107 $200.00 Louis W. & Marion E. Bewley Rent
09/16/90 186 $72.00 Marilyn Michelet
09/14/90 1676 $471.16 BAMA Equipment
09/21/90 1684 $471.16 BAMA Equipment
10/05/90 $5,013.00 09/27/90 1390 $2,506.50 Alviso Rock Inc.
09/27/90 3210 $2,506.50 George Maciel Trucking Inc.
10/17/90 $4,795.39 10/16/90 609 $650.00 James Morrow Rent
10/13/90 1192 $600.00 G & S Paving Hood for Truck Payable: Newark Truck & Body
10/06/90 1228 $500.00 Daniel Parquette Oct Rent
09/21/90 4371 $900.07 L.R. Sellars Jr. Insurance RP End Payable: Plymouth Inc.
10/04/90 4000 $653.00 Daniel Hernandez Jr.
10/05/90 1724 $471.16 BAMA Equipment Payable: Alviso Rock
10/12/90 1730 $471.16 BAMA Equipment Payable: Alviso Rock
10/08/90 1911 $550.00 Piazza Mobil Sweeping
10/31/90 $942.32 10/26/90 1746 $942.32 BAMA Equipment Payable to Alviso Rock
12/13/90 $3,203.00 11/30/90 4075 $653.00 Daniel Hernandez Jr.
12/07/90 1942 $550.00 Piazza Mobil Sweeping
12/06/90 12853 $2,000.00 P&C Auto Wreckers Inc. 90 Toyota P/U 4x4
12/19/90 $2,270.00 12/17/90 1784 $600.00 BAMA Equipment
12/07/90 1187 $400.00 Louis W. & Marion E. Bewley Rent
12/16/90 654 $670.00 James Morrow Phone
12/14/90 1188 $600.00 Louis W. & Marion E. Bewley Rent
12/31/90 $693.02 $693.02 Interest for Year
TOTAL $105,340.39 $105,340.39 $(1,571.77)
 - 58 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Deposit Check Check Check Less
Date Amount Date Number Amount Payor Check Memos Comments Cash
01/03/91 $5,013.00 12/27/90 1710 $2,506.50 Alviso Rock, Inc.
12/27/90 3757 $2,506.50 George Maciel Trucking Inc.
02/06/91 $5,552.12 01/11/91 1225 $200.00 Louis Bewley Jan 92
01/31/91 1236 $200.00 Louis Bewley Jan ??
01/18/91 1226 $200.00 Louis Bewley Jan ??
01/25/91 3901 $2,476.06 George Maciel Trucking Inc.
01/24/91 1776 $2,476.06 Alviso Rock, Inc.
02/20/91 $1,937.53 02/19/92 699 $650.00 James Morrow Rent
02/15/91 251175006 $634.53 Leslie Salt Payable: Newark Truck & Body
02/06/91 4130 $653.00 Daniel Hernandez, Jr.
02/21/91 $5,502.43 02/06/91 4484 $4,777.43 Hawaiian Insurance M.A.C. Contracting Inc. Payable: Newark Truck & Body
02/19/91 4499 $725.00 Hawaiian Insurance M.A.C. Contracting Inc. Payable: Newark Truck & Body
03/13/91 $2,203.00 03/08/91 1264 $400.00 Louis Bewley Feb 2&3
03/07/91 9747 $500.00 Richard Moneymaker Lowbed Payable: Newark Truck & Body
03/02/91 613 $100.00 Larry Kauffman
03/11/91 1982 $550.00 Piazza Mobil Sweeping
03/11/91 4136 $653.00 Daniel Hernandez, Jr.
03/28/91 $3,924.95 03/12/91 18455 $174.95 Tax Collector, Alameda County 9213124
03/08/91 6571 $2,350.00 M.A.C. Contracting Inc Payable: Newark Truck & Body
03/24/91 1275 $400.00 Louis Bewley #1 & #4
$1,000.00 Unknown Math Error? 3/28 DM of $1,000
04/04/91 $4,952.12 03/28/91 1954 $2,476.06 Alviso Rock, Inc.
03/28/91 4153 $2,476.06 George Maciel Trucking Inc.
04/10/91 $2,350.00 04/09/91 1884 $1,800.00 BAMA Equipment Rent Jan Feb Mar 1991
04/09/91 1992 $550.00 Piazza Mobil Sweeping Rent
04/26/91 $2,753.00 04/10/91 4160 $653.00 Daniel Hernandez, Jr.
04/15/91 732 $650.00 James Morrow Rent
04/05/91 306 $200.00 Merced Rosales
04/18/91 123 $850.00 Lovett Excavating and Paving Pete Hood
04/12/91 1294 $200.00 Louis Bewley
04/05/91 1289 $200.00 Louis Bewley
 - 59 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Deposit Check Check Check Less
Date Amount Date Number Amount Payor Check Memos Comments Cash

05/06/91 $4,773.77 04/27/91 1306 $200.00 Louis Bewley Rent
04/19/91 3921 $3,203.77 Winston Hill Assurance Co Ltd
04/19/91 3922 $1,370.00 Winston Hill Assurance Co Ltd
05/09/91 $2,271.96 05/06/91 26698 $221.96 LMC Metals Payable: Valley Recycling
05/06/91 94 $550.00 Piazza Mobil Sweeping
05/01/91 1338 $1,500.00 Daniel Parquette
05/21/91 $2,047.95 05/16/91 751 $650.00 James Morrow Rent
05/20/91 1356 $975.00 J.S.J. Pipeline Co. Rent May June July
05/18/91 1316 $300.00 Louis Bewley
05/15/91 33460 $122.95 Stewart Title of California
06/04/91 $9,394.92 05/23/91 1933 $2,000.00 BAMA Equipment April May June Rent
06/04/91 2036 $550.00 Piazza Mobil Sweeping
532 $700.00 Ricky and Anna Flores June Rent
05/27/91 1322 $200.00 Louis Bewley
05/31/91 161 $1,000.00 HG Trucking Advance Pmt
05/30/91 2101 $2,472.46 Alviso Rock, Inc.
05/30/91 1477 $2,472.46 George Maciel Trucking Inc.
06/13/91 $1,860.50 06/07/91 1333 $200.00 Louis Bewley
06/10/91 4202 $653.00 Daniel & Cecelia Hernandez Jr.
06/10/91 10203 $1,007.50 Richard Moneymaker Lowbed Payable: Newark Truck & Body
07/09/91 $1,353.00 07/05/91 556 $700.00 Ricky and Anna Flores
07/01/91 4207 $653.00 Daniel & Cecelia Hernandez Jr.
08/05/91 $1,497.00 $1,000.00 Unknown Returned ck 8/9 DM $1,000
$497.00 Unknown
08/13/91 $1,000.00 08/03/91 568 $700.00 Ricky and Anna Flores Rent
08/02/91 1357 $300.00 Louis Bewley Rent
08/21/91 $1,000.00 $1,000.00 Unknown
09/09/91 $6,443.92 08/29/91 3030 $2,472.46 Alviso Rock, Inc.
08/29/91 3121 $2,472.46 George Maciel Trucking Inc.
08/30/91 20912534 $1,499.00 State of California Tax Refund
09/11/91 $14,018.44 09/05/91 8054 $4,000.00 M.A.C. Contracting Inc Payable: Newark Truck & Body
 - 60 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Deposit Check Check Check Less
Date Amount Date Number Amount Payor Check Memos Comments Cash
09/09/91 2557 $8,000.00 S & P Truck & Trailer Repair Payable: Newark Truck & Body
09/09/91 2105 $550.00 Piazza Mobil Sweeping Yard Rent
09/07/91 1881 $500.00 C.K. Transport 1/2 Payment Pete Hood
09/04/91 960334 $268.44 County of Alameda
09/07/91 593 $700.00 Ricky or Ana M. Flores Rent
09/24/91 $5,500.00 09/13/91 3431 $5,500.00 Michel K. Pipes Martha J. Baroo Cummins ??? Engine
"Insuff Funds" - debit memo in acct
10/08/91 $1,000.00 09/23/91 1416 $1,000.00 Daniel Parquette Aug & Sept Rent 0466
10/08/91 $4,951.25 09/26/91 4983 $2,472.46 George Maciel Trucking Inc.
09/26/91 2307 $2,478.79 Alviso Rock, Inc.
11/06/91 $6,526.92 5207 $2,508.46 George Maciel Trucking Inc.
3296 $2,508.46 Alviso Rock, Inc.
10/18/91 864 $650.00 James Morrow Rent
10/18/91 1401 $200.00 Louis Bewley Rent
10/25/91 1403 $200.00 Louis Bewley Rent
10/11/91 1396 $200.00 Louis Bewley Rent
11/02/91 177 $260.00 G & G Express Gears
11/22/91 $2,797.43 11/16/91 5396 $442.43 George Maciel Trucking Inc.
1632 $180.00 Mission Valley Diesel
168907 $150.00 Electric & Gas Industries Asso Refrigerator Rebate
11/01/91 3470 $500.00 P.J. Vierra Rent on Boscell
1596 $975.00 J.S.J. Pipeline Co. Office Rent Oct, Nov, Dec
11/08/91 2174 $550.00 Piazza Mobil Sweeping Rent
12/03/91 $5,615.12 $5,615.12 Unknown
12/31/91 $755.42 12/31/91 $755.42 Interest for the Year
TOTAL $106,995.75 $106,995.75 $0.00
 - 61 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
Payable: Roger
01/06/92 $512.35 01/03/92 6651 $112.35 Alviso Rock, Inc. Balmeda
12/23/91 1438 $200.00 Louis Bewley Rent
12/13/91 1429 $200.00 Louis Bewley Rent
02/06/92 $7,155.92 02/01/92 1467 $1,200.00 Louis Bewley Rent
01/31/92 5617 $2,508.46 George Maciel Trucking, Inc.
01/31/92 2530 $2,472.46 Alviso Rock, Inc.
Office Rent Jan Feb Mar
02/05/92 1710 $975.00 J.S.J. Pipeline Co. '92
02/12/92 $2,953.00 02/05/92 2151 $1,500.00 BAMA Equipment Annual
02/10/92 4359 $653.00 Daniel Hernandez Jr.
02/06/92 1979 $250.00 Charles A. Lamb & Rose C. Lamb
02/10/92 2268 $550.00 Piazza Mobil Sweeping Yard Rent
02/26/92 $3,244.89 02/25/92 216 $500.00 Collette Krull
02/13/92 6943 $349.84 Robertson Trucking Service, Inc for Bett's Springs
949 $650.00 James Morrow Rent
Payable: Newark Truck
02/18/92 371 $450.00 San Jose Equipment Sales & Body
02/08/92 1473 $200.00 Louis Bewley
02/15/92 1482 $200.00 Louis Bewley Rent
02/21/92 6954 $395.05 Robertson Trucking Service, Inc
02/01/92 3530 $500.00 P.J. Vierra Rent on Boscell Rd
03/04/92 $6,241.17 02/28/92 5727 $2,472.46 George Maciel Trucking, Inc.
02/28/92 2589 $2,472.46 Alviso Rock, Inc.
Payable: Joe Gonzales
02/27/92 95687 $1,296.25 North Carolina Occidental Fire All Claims Jr.
03/13/92 $4,516.00 03/06/92 1500 $200.00 Louis Bewley Rent
Payable: Newark Truck
03/05/92 21350 $168.00 Von Euw & L.J. Nunes Trucking & Body
03/11/92 1033 $200.00 Steven M. Taylor Rent
03/05/92 2290 $550.00 Piazza Mobil Sweeping Yard Rent
03/09/92 3618 $300.00 Michel K. Pipes
03/11/92 6695 $3,098.00 Alviso Rock, Inc. DMV
 - 62 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
03/25/92 $4,250.00 03/16/92 1018 $150.00 Pacific Water Truck & Equipment Truck Steps
03/20/92 1512 $200.00 Louis Bewley Rent
Payable: Newark Truck
03/13/92 9447 $3,250.00 MAC Contracting Inc. & Body
03/15/92 963 $650.00 James Morrow Rent
04/01/92 $5,614.36 03/26/92 3634 $300.00 Michel K. Pipes Rent Paid in full
03/11/92 61741206 $369.44 AT&T Residence Service Refund
03/27/92 2649 $2,472.46 Alviso Rock, Inc.
03/27/92 5859 $2,472.46 George Maciel Trucking, Inc.
04/07/92 $1,850.00 03/28/92 1514 $200.00 Louis Bewley Rent
03/29/92 714 $400.00 Ricky or Ana Flores
04/03/92 2022 $250.00 Charles Lamb Rent
04/03/92 1979 $1,000.00 Stockton Semi Trailer Inc.
Payable: Newark Truck
04/16/92 $5,832.69 04/08/92 52280 $2,850.00 F.B. Hart Co. Inc. & Body
Payable: George
04/07/92 32060115 $1,484.26 The Travelers Complete & final Settlement Maciel Trucking Inc
04/10/92 4395 $653.00 Daniel Hernandez Jr.
04/05/92 2308 $550.00 Piazza Mobil Sweeping Yard Rent
Settlement of Property Payable: George
04/07/92 32060106 $295.43 The Travelers Damage Maciel Trucking Inc
04/13/92 726 $200.00 Ricky or Ana Flores
03/10/92 1522 $200.00 Louis Bewley Rent
04/12/92 611 $100.00 Dad's Enterprises
04/16/92 5730 $(500.00) Cashier's Ck to Ann Miller $(500.00)
04/21/92 $4,000.00 04/21/92 CM $4,000.00 Dad's Enterprises Transfer
05/07/92 $5,754.42 05/01/92 6036 $2,481.96 George Maciel Trucking, Inc.
05/01/92 2723 $2,472.46 Alviso Rock, Inc.
04/28/92 738 $400.00 Ricky or Ana Flores
05/01/92 1535 $200.00 Louis Bewley Rent
04/24/92 1530 $200.00 Louis Bewley Rent
05/15/92 $2,378.00 05/13/92 1847 $975.00 J.S.J. Pipeline Co. Office Rent
05/10/92 743 $200.00 Ricky or Ana Flores Rent
 - 63 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
05/10/92 4417 $653.00 Daniel Hernandez Jr.
05/12/92 2319 $550.00 Piazza Mobil Sweeping Yard Rent
06/04/92 $5,954.42 05/29/92 2782 $2,472.46 Alviso Rock, Inc.
05/29/92 6210 $2,481.96 George Maciel Trucking, Inc.
Payable: Ricardo
06/01/92 95756 $1,000.00 Mike Flores Cashier's Check Flores
07/06/92 $7,949.48 06/15/92 1033 $600.00 James Morrow May Rent
06/12/92 1568 $200.00 Louis Bewley Rent
06/05/92 1567 $200.00 Louis Bewley Rent
07/03/92 1580 $200.00 Louis Bewley Rent
06/26/92 1577 $200.00 Louis Bewley Rent
06/11/92 2340 $550.00 Piazza Mobil Sweeping Yard Rent
06/26/92 6415 $2,481.96 George Maciel Trucking, Inc.
06/23/92 60250008305 $1,045.06 Farmers Insurance Group Payble: Alviso Rock
06/26/92 2849 $2,472.46 Alviso Rock, Inc.
08/04/92 $3,181.96 07/31/92 6662 $2,481.96 George Maciel Trucking, Inc.
07/27/92 $300.00 Dad's Enterprises Rent on Yard
07/10/92 1587 $200.00 Louis Bewley Rent
07/17/92 1588 $200.00 Louis Bewley Rent
10/09/92 $8,710.79 10/02/92 3077 $2,478.79 Alviso Rock, Inc.
09/24/92 22750409 $5,032.00 State of California Tax Refund
10/01/92 838 $700.00 Ana Flores Oct 92 Rent
09/25/92 1639 $200.00 Louis Bewley Rent
10/01/92 839 $100.00 Ana Flores Back Rent $40 Balance
10/02/92 1641 $200.00 Louis Bewley Rent
10/21/92 $4,638.29 10/07/92 7116 $2,488.29 George Maciel Trucking, Inc.
10/15/92 56812 $1,000.00 Bank of Agriculture Cashier's Ck Rent Oct & Nov
10/11/92 3579 $500.00 Linda Ventura Sept Rent
10/15/92 1093 $650.00 James Morrow Rent
11/10/92 $1,525.00 11/04/92 2499 $550.00 Piazza Mobil Sweeping Yard Rent
11/06/92 2064 $975.00 J.S.J. Pipeline Co. Office Rent
 - 64 -

THE BANK OF MILPITAS ACCOUNT 512-001-200593 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
Payable: Newark Truck
12/07/92 $7,670.42 11/20/92 1824 $344.00 Carlton Trucking MC-2 Repair & Body
3208 $2,508.46 Alviso Rock, Inc.
12/02/92 2521 $550.00 Piazza Mobil Sweeping Rent Dec
11/30/92 551 $650.00 Margaret or Kelvin Deemer Rent
12/03/92 9484 $2,517.96 George Maciel Trucking, Inc.
11/20/92 1676 $200.00 Louis Bewley Rent
11/13/92 1675 $200.00 Louis Bewley Rent
Bounced - 12/15/92
12/05/92 879 $700.00 Ana Flores DM
12/31/92 $339.64 12/31/92 $339.64 Interest for Year
TOTAL $94,272.80 $94,272.80 $(500.00)
 - 65 -
APPENDIX “B”

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
01/03/90 $22,271.15 01/02/90 $490.00 James Morrow Rent & Elect
12/22/89 5551 $1,024.15 Alviso Rock Inc
12/27/89 3895 $1,000.00 George Maciel Trucking Reimburse for DMV Fees
12/29/89 1298 $10,000.00 BAMA Equipment Shareholder Draw
12/27/89 247 $9,757.00 Atherton & Stevens Trust Acct Arbitration Award
01/26/90 $4,903.06 01/25/90 1983 $2,451.53 George Maciel Trucking
01/25/90 10127 $2,451.53 Alviso Rock Inc
01/26/90 $7,500.00 01/19/90 35286 $7,500.00 Sutter Insurance Company Collision Loss '71 Freuhauf Payable: Alviso Rock Inc.
02/14/90 $22,004.93 02/09/90 12142 $15,000.00 Taylor Leasing Inc. Gonzalez Payable: Alviso Rock
02/09/90 1332 $600.00 BAMA Equipment February Rent
08/25/89 3259 $4,447.40 George Maciel Trucking Payable: Fred Isit
02/07/90 1667 $550.00 Piazza Mobil Sweeping Rent Yard
2011 $147.09 George Maciel Trucking Payable: H. Gonzales
01/26/90 1321 $349.66 BAMA Equipment Parts Payable: Alviso Rock
02/02/90 1328 $349.66 BAMA Equipment Parts Payable: Alviso Rock
02/09/90 1331 $349.66 BAMA Equipment Parts Payable: Alviso Rock
2040 $211.46 George Maciel Trucking Payable: Gonzales
02/28/90 $6,711.13 02/23/90 1355 $349.66 BAMA Equipment Parts Payable: Alviso Rock
02/25/90 2113 $2,451.53 George Maciel Trucking
Property Damage and Down
02/19/90 400270136 $3,909.94 Progressive Companies Time Payable: Alviso Rock
Payable: George Maciel
03/19/90 $6,500.00 03/17/90 426 $13,000.00 Daniel Hernandez Trucking Inc
1/2 deposited to acct
$(6,500.00) 001-300431 "George P. Maciel" ($6,500.00)

03/20/90 $100,000.00 03/20/90 CM $100,000.00 Time Certificate of Deposit
05/09/90 $5,473.98 04/27/90 965 $200.00 Louis Bewley
04/30/90 1057 $250.00 Charles A. Lamb
05/05/90 151 $450.00 Daniel Estacio Home Rent
04/27/90 1449 $357.66 BAMA Equipment Payable to Alviso Rock
 - 66 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
04/24/90 46568 $2,616.32 Grade-Way Construction Payable to Alviso Rock
05/03/90 1461 $1,000.00 BAMA Equipment
05/03/90 1460 $600.00 BAMA Equipment Rent
05/24/90 $6,317.00 05/18/90 3145 $14,017.00 US Treasury
$(7,700.00) Cash Back $(7,700.00)
06/11/90 $73,495.18 05/16/90 249 $47,495.18 Cashier's Ck
04/27/90 179 $25,000.00 Cashier's Ck
06/01/90 4573 $1,000.00 Taco Bravo
06/19/90 $15,000.00 06/19/90 $15,000.00 Travelers Checks 30 x $500
Payable: Newark Truck &
07/02/90 $20,426.17 06/23/90 1392 $1,952.07 Fleming Transport Body
06/28/90 2739 $2,474.10 George Maciel Trucking
Payable: George Maciel
06/26/90 1569 $15,000.00 BAMA Equipment Trucking
06/22/90 4601 $1,000.00 Taco Bravo
07/10/90 $4,050.00 05/07/90 1027 $650.00 Steve Giarusso Trucking Rent
07/05/90 2516 $800.00 Roy's Truck Painting 76 Ford Hood
07/03/90 1585 $1,000.00 BAMA Equipment
07/03/90 1584 $600.00 BAMA Equipment July Rent
07/02/90 426 $800.00 Rex A. Hill 1/2/ pymnt on …
06/29/90 1040 $200.00 Louis Bewley
07/18/90 $9,600.00 07/18/90 $9,600.00 Currency
07/24/90 $9,700.00 07/24/90 $9,700.00 Currency
07/26/90 $9,800.00 07/26/90 $9,800.00 Currency
09/07/90 $7,500.00 09/06/90 2082 $7,500.00 Cashier's Ck Bank of Milpitas
09/14/90 $5,502.51 09/05/90 3981 $652.51 Daniel Hernandez Sept
09/11/90 1888 $550.00 Piazza Mobil Sweeping
09/08/90 1207 $500.00 Daniel Parquette Sept. Rent
09/01/90 1098 $200.00 Louis Bewley Rent
09/11/90 1673 $600.00 BAMA Equipment Sept Rent
Payable: Newark Truck &
12249 $3,000.00 Sandman, Inc Star Concrete Invoice #102 Body
 - 67 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
Payable: George Maciel
09/25/90 $4,502.00 09/11/90 64208 $4,502.00 American Business Ins Brokers Trucking Inc
10/05/90 $6,261.70 10/04/90 1722 $600.00 BAMA Equipment Oct Rent
09/28/90 1122 $200.00 Louis Bewley Rent
09/21/90 1121 $200.00 Louis Bewley Rent
10/05/90 1504 $1,000.00 Hillview Engineering Corp Advertising
Payable to Newark Body
09/24/90 9050 $500.00 Richard Moneymaker Lowbed Shop
09/28/90 1710 $471.16 BAMA Equipment
08/25/89 4085 $2,290.54 George Maciel Trucking Payable to Fred Isit
09/02/90 4694 $1,000.00 Taco Bravo
10/12/90 $40,000.00 10/12/90 CM $40,000.00 Unknown
10/23/90 $1,600.00 10/23/90 $1,200.00 Unknown ABA 11-35
$200.00 Unknown ABA 11-57
$200.00 Unknown ABA 11-57
11/01/90 $1,200.00 10/20/90 1527 $1,200.00 Hillview Engineering Corp "Insuff Funds" - ck bounced
11/01/90 $5,013.00 $5,013.00 Unknown
11/14/90 $10,256.07 11/02/90 1149 $200.00 Louis Bewley
11/09/90 1161 $200.00 Louis Bewley Rent
11/09/90 630 $650.00 James Morrow Rent
11/09/90 1928 $550.00 Piazza Mobil Sweeping
Payable: George Maciel
11/06/90 1400 $1,400.00 Alan Hosking 125 Northgate Trucking Inc
11/09/90 1760 $1,000.00 BAMA Equipment
11/09/90 1203 $975.00 J.S.J. Pipeline Co. Rent Office Nov Dec Jan
11/07/90 4065 $653.00 Daniel Hernandez
10/17/90 3048 $1,000.00 Money Order Payable to John Alves
Payable: Newark Truck &
11/10/90 5477 $2,428.07 Wesley E. Bassett Trucking 89 Pete Cab Body
11/01/90 347 $1,200.00 Jeff Varnel BofA Money Order
11/23/90 $5,592.32 11/10/90 1255 $500.00 Daniel Parquette Nov Rent
11/16/90 1767 $942.32 BAMA Equipment Payable: Alviso Rock
11/13/90 4811 $1,000.00 Taco Bravo
 - 68 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1990

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
11/21/90 566 $3,000.00 Lavrar Trucking Loan
11/21/90 5818 $150.00 George Maciel Trucking Payable: Cash
11/27/90 $2,800.00 11/26/90 1171 $400.00 Louis Bewley Rent
11/26/90 1172 $200.00 Louis Bewley Rent
Collision-Final Replacing
09/03/90 38433 $2,200.00 Adriatic Insurance Company 38204
12/06/90 $7,443.29 11/29/90 1269 $500.00 Daniel Parquette Rent Dec
11/29/90 3574 $2,506.50 George Maciel Trucking
11/29/90 1561 $2,506.50 Alviso Rock Inc
12/03/90 21258 $1,500.00 Contract Transportation Service
11/13/90 35455 $430.29 Granite Rock Payable: Alviso Rock Inc.
12/13/90 $67,256.00 11/19/90 2198795 $67,256.00 Transamerica Insurance Group Payable: Alviso Rock
Payable: George Maciel
12/19/90 $8,644.10 12/10/90 400716766 $8,644.10 Progressive Companies Legal Billing Trucking
Payable: George Maciel
12/27/90 $3,594.14 12/19/90 65686 $1,310.14 CNA Insurance Companies Repairs/Downtime Trucking
Payable: Newark Truck &
12/21/90 5534 $1,034.00 Edron Towing and Recovery Repair #65 Front End Body
12/21/90 2453 $1,250.00 Michael Mitchem Interest on Loan
12/31/90 $15,606.29 12/31/90 $15,606.29 Interest for the Year
TOTAL $516,524.02 $516,524.02 $(14,200.00)

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
Payable: Newark Truck &
01/08/91 $3,016.79 12/31/90 15172 $3,016.79 Jess' Trucking Inc. Body
Payable: Newark Truck &
01/17/91 $3,690.92 01/08/91 3552 $850.51 Osborne Lumber Co. Inc. 0243 Body
01/08/91 1952 $550.00 Piazza Mobil Sweeping
01/11/91 6095 $587.41 George Maciel Trucking Inc.
 - 69 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
01/05/91 4116 $653.00 Daniel Hernandez Jr.
01/16/91 672 $650.00 James Morrow Rent
12/31/90 1209 $200.00 Louis Bewley
01/04/91 1210 $200.00 Louis Bewley Jan #1
Payable: Newark Truck &
02/14/91 $10,074.02 02/11/91 2543 $384.25 Salinas Trucking Repair Left Front ?? & Paint Body
Payable: Newark Truck &
12/21/90 1236 $1,000.00 Ken Ash dba Kens Trucking Body
Payable: Newark Truck &
02/01/91 4480 $5,067.57 Hawaiian Insurance Group MAC Contracting Body
02/09/91 1289 $975.00 J.S.J. Pipeline Co. Office Rent Feb, Mar, Apr
02/07/91 1971 $550.00 Piazza Mobil Sweeping February
02/08/91 606 $1,500.00 Lavrar Trucking Repairs Mack
02/08/91 14124 $597.20 LMC Metals
02/25/91 $10.00 02/25/91 $0.00 Deposit Correction
02/25/91 $5,142.12 02/08/91 1249 $200.00 Louis Bewley Rent Feb
02/21/91 1847 $2,476.06 Alviso Rock Inc.
$2,476.06 Unknown
02/25/91 $13,900.00 02/25/91 1842 $1,000.00 BAMA Equipment October 1990
02/24/91 1308 $1,000.00 Daniel Parquette
02/25/91 1846 $600.00 BAMA Equipment Dec 1990
Reimburse Reliance End
02/25/91 1841 $11,300.00 BAMA Equipment Dump
Payable: Newark Truck &
03/01/91 $5,345.80 02/14/91 9645 $1,000.00 Richard Moneymaker Lowbed Payment on #0240 Body
02/26/91 1349 $90.00 Mission Valley Diesel
Payable: Newark Truck &
02/27/91 12831 $2,017.01 Ben Salamoni Trucking Service Body
Supplement to Repair Inv Payable: Newark Truck &
02/27/91 48153214 $429.39 Wausau Insurance Co. #0246 Body
Payable: Newark Truck &
02/21/91 11027 $1,809.40 Circo Recyclers Body
03/28/91 $12,378.57 03/19/91 716 $650.00 James Morrow Rent
03/25/91 $6,250.00 Marcelo Rodriguez Jr.
 - 70 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
03/25/91 904802 $5,478.57 State Farm Mutual Auto Ins. Property Damage
04/22/91 $4,000.00 04/22/91 CM $4,000.00 Reversal of 4/19/91 Transfer
Payable: Dale Hinson &
04/26/91 $15,081.35 04/08/91 336113 $3,228.20 Guaranty National Ins co. Claim for Rodriguez Trkg Newark Truck & Body
Payable: Newark Truck &
04/17/91 6800 $2,277.50 MAC Contracting Inc. Body
04/09/91 40697 $3,721.86 Adriatic Insurance Company Collision Final Payable: Alviso Rock Inc.
Payable: Newark Truck &
04/04/91 4142 $901.67 Osborne Lumber Co. Inc. 0258 Body
04/25/91 2023 $2,476.06 Alviso Rock Inc.
4297 $2,476.06 George Maciel Trucking Inc.
05/09/91 $3,721.86 04/09/91 40697 $3,721.86 Adriatic Insurance Company Collision Final Redeposit of above
06/10/91 $1,428.00 $1,428.00 Unknown
Payable: Newark Truck &
06/13/91 $8,250.00 06/07/91 7250 $8,250.00 MAC Contracting Inc. Body
07/02/91 $7,853.78 06/25/91 1325 $392.78 Ken Ash dba Kens Trucking
$7,461.00 Unknown
07/09/91 $800.00 07/02/91 6838 $800.00 George Maciel Trucking Inc. DiSalvo Loan
Payable: George Maciel
07/09/91 $40,000.00 06/28/91 991463 $42,887.00 Republic Indemnity 3/4/89 to 3/4/90 Trucking
06/28/91 $(2,887.00) Less Cash ($2,887.00)
07/18/91 $4,332.25 07/09/91 2062 $550.00 Piazza Mobil Sweeping
07/16/91 1424 $975.00 J.S.J. Pipeline Co. Office Rent 8-9 8-10-91
07/12/91 126 $100.00 Collette M. Krull Loan
07/16/91 792 $650.00 James Morrow
07/05/91 1348 $200.00 Louis Bewley
Payable: Newark Truck &
07/12/91 6484 $857.25 Heavy Metal Express Body
$1,000.00 Unknown
08/05/91 $7,344.92 $7,344.92 Unknown
Pacific Water Truck &
08/13/91 $8,050.00 08/09/91 1778 $500.00 Equipment 18 Farm Lane
08/08/91 2086 $550.00 Piazza Mobil Sweeping Rent Yard
08/02/91 1357 $300.00 Louis Bewley Rent
 - 71 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Check
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
08/03/91 568 $700.00 Ricky or Ana M. Flores Rent
$6,000.00 Unknown
08/21/91 $3,274.06 $3,274.06 Unknown
09/09/91 $1,679.00 07/19/91 1498 $79.00 Mission Valley Diesel
09/03/91 2048 $600.00 BAMA Equipment Sept Rent
$1,000.00 Unknown
Payable: George Maciel
09/24/91 $16,241.00 09/09/91 110752 $1,615.30 USPCI Trucking
09/13/91 $11,613.00 United States Treasury Tax Refund
May have bounced - 10/1
09/23/91 1416 $1,000.00 Daniel Parquette Aug & Sept Rent DM
09/06/91 1376 $200.00 Louis Bewley Rent
09/20/91 1864 $310.00 Paul R & Marianne Bourgeois
09/13/91 1383 $200.00 Louis Bewley Rent
09/02/91 4033 $653.00 Daniel Hernandez Jr.
09/16/91 836 $650.00 James Morrow Rent
10/08/91 $4,600.70 10/05/91 611 $700.00 Ricky or Ana M. Flores Rent
09/23/91 1626 $950.00 Cook's Peninsula Pools Inc. 155 Tobin Clark, Hillsboro
09/21/91 1895 $500.00 C.K. Transport Final Payment for Pete Hood
10/04/91 938 $600.00 Mary Griffin Pool Water
Pacific Water Truck & Payable to Newark Truck &
10/04/91 1874 $1,850.70 Equipment Inv. #0271 Body
11/22/91 $4,992.53 11/18/91 894 $650.00 James Morrow Rent
$4,342.53 Unknown
Any and all property damage
12/03/91 $7,286.68 11/12/91 10015 $7,286.68 John Deere Insurance Company cl
12/16/91 $2,940.60 12/01/91 3491 $500.00 P.J. Vierra Rent on Boscell Dec.
Supplemental Payment Payable: Newark Truck &
11/01/91 6806 $2,200.60 Calfarm Insurance Company Collision Body
Payable: Newark Truck &
12/12/91 1125 $40.00 Gerardo Ozuna Ozuna Trucking Parts-Step Body
12/06/91 1422 $200.00 Louis Bewley Rent
12/30/91 $10,678.72 12/27/91 2443 $2,508.46 Alviso Rock Inc.
THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1991

Deposit Check - 72 -
Deposit Date Amount Check Date Number Check Amount Payor Check Memos Comments Less Cash
12/27/91 5440 $2,508.46 George Maciel Trucking Inc.
12/27/91 4055 $250.00 Sines Trucking Company, Inc. Yard Rent Space
12/23/91 21065 $2,329.86 Von Euw & L.J. Nunes Trucking
12/20/91 1848 $500.00 Stockton Semi Trailer Inc. Rent
Payable: Newark Truck &
12/17/91 911 $88.94 Ferma Corporation Balance on Hood repair Body
Payable: Newark Truck &
12/16/91 640 $1,600.00 Ferma Corporation Job 2989 Body
12/14/91 4306 $653.00 Daniel Hernandez Jr.
General Motors Acceptance Payable: Newark Truck &
12/20/91 22228 $240.00 Corp Body
12/30/91 $20,000.00 12/30/91 CM $20,000.00 Telephonic Transfer From BM 0593
12/31/91 $3,095.55 12/31/91 $3,095.55 Regular Interest for Year
12/31/91 $12,034.25 12/31/91 $12,034.25 TCD Interest for Year
TOTAL $241,243.47 $241,243.77 ($2,887.00)

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
01/23/92 $3,053.00 01/10/92 2235 $550.00 Piazza Mobil Sweeping Yard Rent
01/15/92 1888 $500.00 Stockton Semi Trailer Dec Rent
01/17/92 676 $200.00 Ricky or Ana Flores Rent
01/15/92 932 $650.00 James Morrow Rent
01/11/92 4338 $653.00 Daniel Hernandez
01/11/92 667 $500.00 Ricky or Ana Flores Rent
02/06/92 $8,113.06 02/04/92 271003216 $13,000.00 David Mitchem Wells Fargo Cashier's Check Payable: David Mitchem
01/28/92 1378 $125.00 Analytical Maintenance Service
Payable: Newark Truck &
01/29/92 1157 $175.34 Gerardo Ozuna Hood Ozuna Trucking Body
Payable: Newark Truck &
02/01/92 3057 $200.00 Cirimeless Construction Peterbuilt Fender Body
01/31/92 1464 $200.00 Louis Bewley Rent
01/07/92 621 $12.72 John & Annette Strong
 - 73 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
01/25/92 1007 $200.00 Steven Taylor Money Owed
02/07/92 685 $700.00 Ricky or Ana Flores Bounced - 2/14/92 DM
$(6,500.00) Less Cash $(6,500.00)
03/03/92 $100,000.00 03/03/92 CM $100,000.00 Balance from COD #001291269
03/04/92 $4,821.00 03/03/92 8153 $2,449.00 George Maciel Trucking Inc. DMV
03/02/92 4373 $653.00 Daniel Hernandez
03/02/92 700 $700.00 Ricky or Ana Flores Feb 92 Rent
Payable: Newark Truck &
02/26/92 1954 $369.00 Valley Recycling 2 Doors Body
03/03/92 1965 $250.00 Charles Lamb
03/02/92 701 $200.00 Ricky or Ana Flores March Rent 92
02/29/92 1494 $200.00 Louis Bewley Rent
Cashier's Ck to Santa Clara Title "Not used for intended
03/04/92 $136,945.68 03/03/92 5437 $136,945.68 Co purpose"
Payable: Newark Truck &
04/24/92 $1,940.00 04/15/92 20417 $890.00 D. Hill Trucking Invoice 0280 Body
04/20/92 0567 $200.00 Alameda Truck Parts & Equip
04/15/92 978 $650.00 James Morrow Rent
04/17/92 1526 $200.00 Louis Bewley Rent
05/15/92 $7,657.22 03/20/92 8140454 $7,657.22 California Land Title Co. Escrow No. 331486-LM
06/03/92 $100,000.00 06/03/92 CM $100,000.00 Balance from #01-201318
06/04/92 $1,625.00 05/13/92 124210 $325.00 Trammell Crow Residential Serv
05/22/92 2174 $500.00 Valley Recycling
05/22/92 1547 $200.00 Louis Bewley Rent
05/29/92 1548 $200.00 Louis Bewley Rent
05/15/92 1544 $200.00 Louis Bewley Rent
05/08/92 1543 $200.00 Louis Bewley Rent
06/12/92 $1,972.66 1014 $650.00 James Morrow
Payable: Newark Truck &
06/05/92 19680 $1,322.66 D. Hill Trucking Body
 - 74 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
7/23/92 $9,144.50 07/13/92 2375 $550.00 Piazza Mobil Sweeping Yard Rent
07/04/92 24543668 $672.00 State of California EDD Payable: Felix Dominguez
07/06/92 758 $700.00 Ana Flores
07/10/92 4466 $653.00 Daniel Hernandez
07/15/92 1050 $650.00 James Morrow Rent
07/02/92 1684 $2,000.00 Truck Trailer Sales, Inc.
06/27/92 46949 $49.50 Washington Hospital Healthcare
07/14/92 25130367 $3,870.00 Ritchie Bros.
08/04/92 $57,472.00 07/31/92 996887 $57,472.00 Republic Indemnity Policy Workers Comp Payable: Alviso Rock
08/05/92 $975.00 08/05/92 1931 $975.00 J.S.J. Pipeline Office Rent July-Sept 92
Payable: Newark Truck &
08/25/92 $15,479.01 08/18/92 102489409 $10,636.37 State Farm Mutual Auto Insur Property Damage Liability Body
08/07/92 2938 $2,472.46 Alviso Rock, Inc.
Payable: Newark Truck &
08/13/92 12064 $500.00 Richard Money Maker Lowbed On Account Body
08/05/92 2405 $550.00 Piazza Mobil Sweeping Rent
08/11/92 25099 $17.18 PG&E Refund Account
08/17/92 1066 $650.00 James Morrow Rent
08/10/92 4493 $653.00 Daniel Hernandez
Payable: Moneymaker
09/08/92 $7,981.78 07/25/92 6574 $728.19 George Maciel Trucking Inc. Lowbed
09/02/92 2435 $550.00 Piazza Mobil Sweeping Rent
09/04/92 2069 $72.00 Mission Valley Diesel
08/28/92 2998 $2,472.46 Alviso Rock, Inc.
08/27/92 3 $100.00 Dad's
08/21/92 1611 $200.00 Louis Bewley Rent
09/04/92 1622 $200.00 Louis Bewley Rent
08/26/92 2581 $277.00 Scott Balcon
09/03/92 814 $700.00 Ana Flores Sept Rent
 - 75 -

THE BANK OF MILPITAS ACCOUNT 512-001-300466 "GEORGE A. MACIEL"
DEPOSITS - 1992

Deposit Check Check
Deposit Date Amount Check Date Number Amount Payor Check Memos Comments Less Cash
Payable: Newark Truck &
09/01/92 1709 $200.00 Carlton Trucking Pete Front Bumper Body
08/28/92 6882 $2,481.96 George Maciel Trucking Inc.
$0.17 Deposit Correction
09/23/92 $18,398.00 09/12/92 4534 $653.00 Daniel Hernandez That's All Folks! Thank You
09/11/92 1631 $200.00 Louis Bewley Rent
09/11/92 $16,895.00 United States Treasury Tax Refund
09/16/92 1078 $650.00 James Morrow Rent
10/21/92 $20,705.67 10/13/92 1135 $10,381.17 First American Title Insurance Escrow No. 208810AM
10/09/92 134 $10,324.50 Dennis Ponte, Inc
11/05/92 $4,628.46 11/02/92 533 $1,000.00 Margaret or Kelvin Deemer Rent + $350 Back Pay
11/04/92 864 $700.00 Ana Flores Rent Nov
10/29/92 1020 $220.00 Dad's Enterprises
10/23/92 1649 $200.00 Louis Bewley Rent
10/30/92 3140 $2,508.46 Alviso Rock, Inc.
12/10/92 $2,892.90 12/09/92 3065 $2,892.90 Dean and Suzanne Mack
12/31/92 $3,096.07 12/31/92 $3,096.07 Regular Interest for Year
12/31/92 $2,593.82 12/31/92 $2,593.82 TCD Interest for Year
TOTAL $509,494.83 $509,494.83 $(6,500.00)
 - 76 -
APPENDIX “C”

THE BANK OF MILPITAS ACCOUNT 512-001-303171 "G M INVESTMENTS"
DEPOSITS - 1991

Deposit Check Check
Deposit Date Amount Date Number Check Amount Payor Check Memos Comments
Transfer from 001-3-1856 (per sig
06/04/91 $1,568.38 $1,568.38 Unknown card)
06/05/91 $8,900.00 $8,400.00 Unknown ABA 90-19
$500.00 Unknown ABA 90-785
06/10/91 $250.00 $250.00 Unknown
07/09/91 $8,650.00 $8,650.00 Unknown
07/18/91 $500.00 $500.00 Unknown
08/13/91 $8,900.00 08/01/91 3418 $500.00 P J Vierra Aug Rent Boscell
08/02/91 20618 $8,400.00 P.S.B. Trucking Inc
09/06/91 $12.00 09/06/91 DM $12.00 Reversal of Ck Charge
09/09/91 $8,900.00 09/01/91 3439 $500.00 P J Vierra Rent Boscell Sept
09/05/91 10787 $8,400.00 P.S.B. Trucking Inc Payable to GM Investments
10/08/91 $9,100.00 10/01/91 20947 $8,400.00 P.S.B. Trucking Inc Payable to M&G Investments
10/01/91 3455 $500.00 P J Vierra Rent Oct Boscell
09/27/91 1389 $200.00 Louis W. Bewley
10/16/91 $2,903.00 10/07/91 2134 $550.00 Piazza Mobil Sweeping
10/09/91 1391 $200.00 Louis W. Bewley Rent
10/11/91 1428 $1,500.00 Daniel T. Parquette ck bounced
10/10/91 4005 $653.00 Daniel Hernandez OOPS
12/31/91 $127.69 12/31/91 $127.69 Interest for the Year
TOTAL $49,811.07 $49,811.07
 - 77 -

THE BANK OF MILPITAS ACCOUNT 512-001-303171 "G M INVESTMENTS"
DEPOSITS - 1992

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments
01/06/92 $9,150.00 12/27/91 21465 $8,400.00 P.S.B. Trucking Inc. Payable to M & G Investments
01/01/92 3509 $500.00 PJ Vierra Rent on Boscell
01/02/92 1921 $250.00 Charles and Rose Lamb
Robertson Trucking
01/23/92 $4,306.20 01/15/91 6892 $2,493.20 Service
12/30/91 485 $1,813.00 John Deere Insurance Co. Insurance claim
02/06/92 $9,000.00 02/03/92 21690 $8,400.00 P.S.B. Trucking Inc. Payable to M & G Investments
01/24/92 1454 $600.00 Louis Bewley Rent
02/12/92 $3,500.00 02/10/92 180 $3,500.00 George A. Maciel from acct 300466
03/06/92 $9,400.00 03/03/92 1952 $500.00 Stockton Semi Trailer Inc
03/06/92 3548 $500.00 PJ Vierra
03/03/92 21859 $8,400.00 P.S.B. Trucking Inc. Payable to M & G Investments
04/07/92 $8,400.00 04/02/92 22003 $8,400.00 P.S.B. Trucking Inc. Payable to M & B Investments
05/07/92 $8,900.00 05/01/92 3595 $500.00 PJ Vierra
05/07/92 22180 $8,400.00 P.S.B. Trucking Inc. Payable to M & B Investments
05/15/92 $350.00 05/07/92 2033 $250.00 Charles and Rose Lamb Rent
05/11/92 628 $100.00 Dad's Enterprises R.O. 9
06/04/92 $8,400.00 06/01/92 22351 $8,400.00 P.S.B. Trucking Inc. Payable to GM Investments
06/12/92 $903.00 06/02/92 2094 $250.00 Charles and Rose Lamb Rent
Daniel and Cecelia
06/06/92 4433 $653.00 Hernandez
07/06/92 $1,000.00 06/26/92 2351 $500.00 Piazza Mobil Sweeping Engine 5
06/01/92 3609 $500.00 PJ Vierra Rent Boscell June
07/09/92 $8,650.00 07/06/92 22567 $8,400.00 P.S.B. Trucking Inc. Payable to GM Investments
Sines Trucking Company
06/30/92 4277 $250.00 Inc. Rent
Bank of West money
07/23/92 $1,364.00 07/15/92 2653 $614.00 order Payable to Newark Truck & Body
07/01/92 3627 $500.00 PJ Vierra
 - 78 -

THE BANK OF MILPITAS ACCOUNT 512-001-303171 "G M INVESTMENTS"
DEPOSITS - 1992

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments
07/08/92 2116 $250.00 Charles and Rose Lamb July (92)
Richard Moneymaker
08/04/92 $500.00 07/24/92 11966 $500.00 Lowbed Payable to Newark Body Shop
08/05/92 $800.00 08/01/92 775 $800.00 Ana M. Flores Rent
08/05/92 $8,400.00 07/29/92 22682 $8,400.00 P.S.B. Trucking Inc. Payable to GM Investments
08/25/92 $750.00 08/01/92 3656 $500.00 PJ Vierra Rent Boscell Aug
08/11/92 2220 $250.00 Charles and Rose Lamb Rent 41550 Boscell
09/08/92 $9,150.00 09/01/92 3671 $500.00 PJ Vierra Rent Boscell Sep
09/02/93 2245 $250.00 Charles and Rose Lamb
09/01/92 22886 $8,400.00 P.S.B. Trucking Inc. Payable to GM Investments
09/23/92 $300.00 09/17/92 162 $300.00 Ross Hamilton
10/09/92 $9,400.00 10/05/92 23116 $8,400.00 P.S.B. Trucking Inc. Payable to GM Investments
$1,000.00 Unknown
10/21/92 $550.00 10/13/92 2481 $50.00 Piazza Mobil Sweeping
10/14/92 2479 $500.00 Piazza Mobil Sweeping Rent
11/05/92 $8,400.00 $8,400.00 Unknown
11/10/92 $750.00 $750.00 Unknown
12/07/92 $9,250.00 $850.00 Unknown
12/01/92 23543 $8,400.00 P.S.B. Trucking Inc. Payable to GM Investments
12/31/92 $312.07 12/31/92 $312.07 Interest for the Year
TOTAL $121,885.27 $121,885.27
 - 79 -
APPENDIX “D”

THE BANK OF MILPITAS ACCOUNT 512-001-102605 "ALVISO ROCK/HK RACING"
DEPOSITS - 1990

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments
04/17/90 $500.00 04/14/90 1282 $500.00 Hillview Engineering Corp #69 Advertising
04/30/90 $2,493.59 04/27/90 522 $2,493.59 George Maciel Closing of Account from WF 384835
05/07/90 $1,525.00 05/03/90 6202 $1,025.00 Alviso Rock Inc Payable to Alviso Rock/HK Racing
04/18/90 3707 $500.00 BBA, Inc. NASCAR Fund Trustee Payable to Howard Kaeding
05/18/90 $2,055.00 05/17/90 4735 $855.00 George Maciel Trucking Inc. Payable to Alviso Rock/HK Racing
05/17/90 1493 $1,200.00 BAMA Equipment Race #4,5,6,7,8 & 9
06/19/90 $1,505.00 06/06/90 3822 $25.00 Northern Auto Racing Club Inc Payable to Howard Kaeding
06/18/90 6240 $545.00 Alviso Rock Inc Payable to Alviso Rock/HK Racing
06/14/90 4929 $335.00 George Maciel Trucking Inc. Advertisement Payable to Alviso Rock/HK Racing
06/19/90 1539 $600.00 BAMA Equipment #69 Payable to Alviso Rock/HK Racing
07/10/90 $500.00 07/10/90 CM $500.00 Deposit Correction No Deposit Ticket
07/10/90 $2,010.00 07/06/90 6247 $2,010.00 Alviso Rock Inc Payable to Alviso Rock/HK Racing
07/26/90 $1,960.00 07/26/90 $750.00 BAMA Equipment Payable to Alviso Rock/HK Racing
07/24/90 5166 $1,160.00 George Maciel Trucking Inc. Payable to Alviso Rock/HK Racing
07/05/90 19888 $50.00 Jack McCoy Enterprises Payable to Howard Kaeding
08/06/90 $210.00 07/15/90 4102 $210.00 Northern Auto Racing Club Inc Payable to Howard Kaeding
08/15/90 $715.00 07/24/90 4163 $715.00 Northern Auto Racing Club Inc Payable to Howard Kaeding
09/14/90 $1,000.00 09/14/90 1277 $300.00 George A. Maciel Sprint Car #69 from acct 200593
09/06/90 1918 $700.00 High-Five Pizza Co. Sponsorship Payable to Alviso Rock/HK Racing
09/25/90 $850.00 09/18/90 1681 $750.00 BAMA Equipment Sponsor
09/07/90 2255 $50.00 BBA, Inc. NASCAR Fund Trustee Payable to Alviso Rock
09/13/90 2319 $50.00 BBA, Inc. NASCAR Fund Trustee Payable to Alviso Rock
10/23/90 $975.00 $500.00 Unknown ABA 90-4176
$475.00 Unknown ABA 11-35
11/08/90 $30.00 11/08/90 $30.00 Reversal of Service Charge
11/23/90 $131.75 11/23/90 $131.75 George A. Maciel from acct 300466
12/27/90 $351.23 11/29/90 68619 $351.23 Awards & Achievement Bureau Payable to Howard Kaeding
TOTAL $16,811.57 $16,811.57
 - 80 -

THE BANK OF MILPITAS ACCOUNT 512-001-102605 "ALVISO ROCK/HK RACING"
DEPOSITS - 1991

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments
04/04/91 $12.00 04/04/91 CM $12.00 Reject Charge Rev.
04/04/91 $1,408.00 04/04/91 1430 $310.00 George A. Maciel from acct 200593
03/30/91 1602 $98.00 Robin Parden Terry NASCAR
03/21/91 2248 $1,000.00 High-Five Pizza Co. Sponsorship Payable to Alviso Rock Racing
04/10/91 $590.00 $590.00 Currency 10x$50 3x$20 2x$10 10x$1
04/30/91 $245.00 $245.00 Currency
05/28/91 $12.00 05/28/91 CM $12.00 Reject Charge Rev.
05/29/91 $1,500.00 CM $1,500.00 Phone Transfer from acct 300466
06/11/91 $1,310.00 $1,310.00 Unknown ABA 11-35
07/02/91 $1,560.00 $1,560.00 Unknown
07/09/91 $1,060.00 $1,060.00 Currency
08/05/91 $600.00 $600.00 Unknown
08/13/91 $500.00 08/13/91 1056 $500.00 GM Investments Sprint from acct 3171
08/21/91 $1,600.00 $1,600.00 Unknown
09/09/91 $2,000.00 09/07/91 163 $2,000.00 George A. Maciel
09/24/91 $360.00 09/11/91 15150 $360.00 California Racing Association
11/06/91 $90.00 10/15/91 6514 $90.00 Northern California Racing Club Payable to George Maciel/Alviso Rock
12/16/91 $1,550.00 12/11/91 2195 $550.00 Piazza Mobil Sweeping
12/07/91 634 $700.00 Ricky or Ana M. Flores Dec Rent
12/12/91 1192 $300.00 Gradetech Inc Headlights for #203
TOTAL $14,397.00 $14,397.00

THE BANK OF MILPITAS ACCOUNT 512-001-102605 "ALVISO ROCK/HK RACING"
DEPOSITS - 1992

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments Less Cash
02/12/92 $3,500.00 02/10/92 1077 $3,500.00 GM Investments Advertising Sprint Car from acct 303171
04/07/92 $7,700.00 04/03/92 3465 $200.00 West Coast Aggregates Inc. Payable to Alviso Rock/HK Racing
 - 81 -

THE BANK OF MILPITAS ACCOUNT 512-001-102605 "ALVISO ROCK/HK RACING"
DEPOSITS - 1992

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments Less Cash
04/07/92 184 $7,500.00 George A. Maciel from acct 300466
04/24/92 $950.00 04/16/92 8946 $450.00 San Jose Commercial Tire Payable to Alviso Rock/HK Racing
04/01/92 3563 $500.00 PJ Vierra Rent on Boscell April
05/07/92 $740.00 05/07/92 $900.00 Alviso Rock Inc. IH 9370 Hood
$(160.00) Less Cash $(160.00)
05/15/92 $621.00 12/31/91 1895 $410.00 Cars Inc. Payable to Howard Kaeding
05/09/92 4930 $36.00 Mary Sue Schriver
$175.00 Currency
06/04/92 $530.00 05/21/92 2207 $210.00 Cars Inc. Payable to Alviso Rock
05/18/92 7159 $100.00 Northern Auto Racing Club Inc Payable to George Maciel/Alviso Rock
$220.00 Currency
06/12/92 $861.00 06/05/92 9440 $600.00 San Jose Commercial Tire Payable to HK Racing
06/08/92 7346 $100.00 Northern Auto Racing Club Inc Payable to George Maciel/Alviso Rock
$161.00 Currency
07/06/92 $814.00 06/08/92 3652 $200.00 West Coast Aggregates Inc. Payable: Alviso Rock/HK Racing
06/25/92 397 $614.00 San Jose Equipment Sales #291 Repairs Payable: Newark Truck & Body/Bounced
07/23/92 $350.00 07/13/92 7590 $150.00 Northern Auto Racing Club Inc Payable to George Maciel/Alviso Rock
07/08/92 3757 $200.00 West Coast Aggregates Inc. Payable to George Maciel/Alviso Rock
08/04/92 $820.00 07/29/92 2422 $820.00 Cars Inc. Payable to Alviso Rock
08/25/92 $1,415.00 07/31/92 1600 $200.00 Louis Bewley Rent
07/24/92 1599 $200.00 Louis Bewley Rent
08/14/92 1607 $200.00 Louis Bewley Rent
08/07/92 3508 $500.00 Linda Ventura Aug. Rent
08/25/92 $315.00 Currency
09/08/92 $1,550.00 09/02/92 1069 $1,350.00 San Jose Commercial Tire June, July, Aug Payable to Alviso Rock/HK Racing
08/28/92 1618 $200.00 Louis Bewley Rent
09/23/92 $200.00 09/18/92 1632 $200.00 Louis Bewley Rent
10/09/92 $325.00 09/19/92 23995 $75.00 Silver Dollar Speedway E Main
09/19/92 23929 $50.00 Silver Dollar Speedway F Main
09/17/92 3947 $200.00 West Coast Aggregates Inc. Payable to Alviso Rock/HK Racing
11/05/92 $2,517.96 10/30/92 7311 $2,517.96 George Maciel Trucking Inc
 - 82 -

THE BANK OF MILPITAS ACCOUNT 512-001-102605 "ALVISO ROCK/HK RACING"
DEPOSITS - 1992

Deposit Check Check Check
Deposit Date Amount Date Number Amount Payor Check Memos Comments Less Cash
11/10/92 $5,000.00 11/10/92 CM $5,000.00 Transfer from acct 1300466
12/07/92 $100.00 11/30/92 2992 $100.00 Cars Inc. Payable to Alviso Rock
12/23/92 $3,500.00 12/23/92 CM $3,500.00 Telephone Transfer from acct 1300466
TOTAL $31,493.96 $31,493.96 $(160.00)
 - 83 -
APPENDIX “E”

WELLS FARGO BANK ACCOUNT 0108-363904 "GEORGE MACIEL/PETE VIVIANO"
DEPOSITS - 1990

Deposit Deposit Check Check
Date Amount Date Number Check Amount Payor Check Memos Comments
01/05/90 $750.00 12/30/89 3047 $500.00 P.J. Vierra & Sons 1/1 to 2/1/90 Payable: M&V Investment
01/02/90 3765 $250.00 Charles A. Lamb Rent
01/08/90 $8,500.00 12/06/89 1102 $8,500.00 George A. Maciel Boscell from BM 0593
01/24/90 $2,150.00 01/24/90 1117 $2,150.00 George A. Maciel from BM 0593
01/25/90 $4,825.00 01/25/90 5662 $4,825.00 Tri City Truck Parts and Equip Isit Cashier's Check Payable to Cash
02/01/90 $500.00 01/29/90 3066 $500.00 P.J. Vierra & Sons Rent 2-1 to 3-1-90 Payable: M&V Investment
02/06/90 $8,400.00 02/02/90 17371 $8,400.00 P.S.B. Trucking Inc. 2/90 Rent
02/14/90 $2,600.00 02/14/90 104 $2,600.00 George A. Maciel Cashier's Check from BM 0466
02/26/90 $3,528.00 02/22/90 11522 $1,764.00 Viviano Trucking Payable: Wells Fargo Bank
02/20/90 1129 $1,764.00 George A. Maciel For Lease Boscell from BM 0593
03/08/90 $8,900.00 02/28/90 3084 $500.00 P.J. Vierra & Sons Rent Payable: M&V Investment
03/07/90 1143 $8,400.00 George A. Maciel Bryant from BM 200593
03/16/90 $250.00 02/01/90 1002 $250.00 Charles A. Lamb Rent
04/05/90 $8,650.00 04/03/90 1094 $250.00 Charles A. Lamb Rent
04/02/90 17726 $8,400.00 P.S.B. Trucking Inc.
04/17/90 $500.00 04/09/90 3112 $500.00 P.J. Vierra & Sons Rent for 4-1 to 5-1 Boscell
04/17/90 $15,954.84 04/16/90 11740 $3,500.00 Viviano Trucking Boscell Prop Taxes Payable to Cash
04/17/90 171 $12,454.84 George A. Maciel Boscell 88/89 Sup Ass from BM 300466
04/19/90 $30.00 04/19/90 $30.00 Reimbursement of Overdraft Chg
05/02/90 $8,400.00 05/01/90 17903 $8,400.00 P.S.B. Trucking Inc.
05/03/90 $1,888.20 05/03/90 5844 $1,888.20 Tri City Truck Parts and Equip AFCO Payable to Cash
05/04/90 $500.00 05/02/90 3127 $500.00 P.J. Vierra & Sons Rent for May on Boscell Payable: M&V Investment
06/29/90 $7.50 06/29/90 $7.50 Reimbursement of Service Chg
06/29/90 $15.00 06/29/90 $15.00 Reimbursement of Service Chg
07/05/90 $100.00 07/05/90 $100.00 Currency
07/06/90 $15.00 07/06/90 $15.00 Reimbursement of Service Chg
TOTAL $76,463.54 $76,463.54
 - 84 -

APPENDIX “F”

1990 DEPOSITS RESULTING FROM NON-TAXABLE ITEMS
Deposit Check Check
Bank Acct Date Date Number Check Amount Payor Check Memos Comments
BM300466 01/03/90 12/29/89 1298 $10,000.00 BAMA Equipment Shareholder Draw
BM300466 01/03/90 12/22/89 5551 $1,024.15 Alviso Rock Inc
BM300466 01/03/90 12/27/89 247 $9,757.00 Atherton & Stevens Trust Acct Arbitration Award
BM300466 01/03/90 12/27/89 3895 $1,000.00 George Maciel Trucking Reimburse for DMV Fees
WF363904 01/08/90 12/06/89 1102 $8,500.00 George A. Maciel Boscell from BM 0593
WF363904 01/24/90 01/24/90 1117 $2,150.00 George A. Maciel from BM 0593
WF363904 01/25/90 01/25/90 5662 $4,825.00 Tri City Truck Parts and Equip Isit Cashier's Check Payable to Cash
BM200593 02/14/90 02/06/90 9014592 $4,500.00 Taco Bravo Cashiers Check
WF363904 02/14/90 02/14/90 104 $2,600.00 George A. Maciel Cashier's Check from BM 0466
BM300466 02/14/90 08/25/89 3259 $4,447.40 George Maciel Trucking Payable: Fred Isit
WF363904 02/26/90 02/20/90 1129 $1,764.00 George A. Maciel For Lease Boscell from BM 0593
WF363904 02/26/90 02/22/90 11522 $1,764.00 Viviano Trucking Payable: Wells Fargo Bank
BM200593 03/08/90 03/06/90 8122797 $1,936.02 California Land Title Co. Escrow 284613-LM
WF363904 03/08/90 03/07/90 1143 $8,400.00 George A. Maciel Bryant from BM 200593
BM200593 03/16/90 03/14/90 1370 $1,000.00 BAMA Equipment
BM200593 03/16/90 83508 $2.00 Revlon Beauty Care
BM300466 03/20/90 03/20/90 CM $100,000.00 Time Certificate of Deposit
BM200593 04/04/90 04/03/90 1412 $1,000.00 BAMA Equipment
BM200593 04/17/90 04/05/90 8123340 $873.88 California Land Title Co. Escrow 287641-LM
WF363904 04/17/90 04/16/90 11740 $3,500.00 Viviano Trucking Boscell Prop Taxes Payable to Cash
WF363904 04/17/90 04/17/90 171 $12,454.84 George A. Maciel Boscell 88/89 Sup Ass from BM 300466
WF363904 04/19/90 04/19/90 $30.00 Reimbursement of Overdraft Chg
BM102605 04/30/90 04/27/90 522 $2,493.59 George Maciel Closing of Account from WF 384835
BM200593 04/30/90 04/19/90 22834 $109.39 Saratoga Savings & Loan Assoc
BM200593 04/30/90 04/20/90 8123737 $44.42 California Land Title Co. Escrow 284613-LM
WF363904 05/03/90 05/03/90 5844 $1,888.20 Tri City Truck Parts and Equip AFCO Payable to Cash
BM300466 05/09/90 05/03/90 1461 $1,000.00 BAMA Equipment
BM102605 05/18/90 05/17/90 1493 $1,200.00 BAMA Equipment Race #4,5,6,7,8 & 9
BM300466 05/24/90 05/18/90 3145 $14,017.00 US Treasury
BM300466 06/11/90 04/27/90 179 $25,000.00 Cashier's Ck
BM300466 06/11/90 05/16/90 249 $47,495.18 Cashier's Ck
WF363904 06/29/90 06/29/90 $7.50 Reimbursement of Service Chg
 - 85 -

1990 DEPOSITS RESULTING FROM NON-TAXABLE ITEMS
Deposit Check Check
Bank Acct Date Date Number Check Amount Payor Check Memos Comments
WF363904 06/29/90 06/29/90 $15.00 Reimbursement of Service Chg
WF363904 07/06/90 07/06/90 $15.00 Reimbursement of Service Chg
BM300466 07/10/90 07/03/90 1585 $1,000.00 BAMA Equipment
BM200593 08/15/90 08/13/90 1641 $1,000.00 BAMA Equipment
BM102605 09/14/90 09/14/90 1277 $300.00 George A. Maciel Sprint Car #69 from acct 200593
BM200593 09/14/90 09/05/90 1124 $2,000.00 Merced Rosales
BM300466 09/14/90 09/05/90 3981 $652.51 Daniel Hernandez Sept
BM300466 10/12/90 10/12/90 CM $40,000.00 Unknown
BM200593 10/17/90 10/04/90 4000 $653.00 Daniel Hernandez Jr.
BM300466 10/23/90 $1,200.00 Unknown ABA 11-35
BM300466 11/01/90 10/20/90 1527 $1,200.00 Hillview Engineering Corp "Insuff Funds" - ck bounced
BM102605 11/08/90 11/08/90 $30.00 Reversal of Service Charge
BM300466 11/14/90 11/07/90 4065 $653.00 Daniel Hernandez
BM300466 11/14/90 11/09/90 1760 $1,000.00 BAMA Equipment
BM300466 11/23/90 11/21/90 566 $3,000.00 Lavrar Trucking Loan
BM102605 11/23/90 11/23/90 $131.75 George A. Maciel from acct 300466
BM200593 12/13/90 11/30/90 4075 $653.00 Daniel Hernandez Jr.
1990
TOTAL $328,286.83

1991 DEPOSITS RESULTING FROM NON-TAXABLE ITEMS
Deposit Check Check
Bank Account Date Date Number Check Amount Payor Check Memos Comments
BM300466 01/17/91 01/05/91 4116 $653.00 Daniel Hernandez Jr.
BM200593 02/20/91 02/06/91 4130 $653.00 Daniel Hernandez, Jr.
BM300466 02/25/91 02/25/91 1842 $1,000.00 BAMA Equipment October 1990
Reimburse Reliance End
BM300466 02/25/91 02/25/91 1841 $11,300.00 BAMA Equipment Dump
BM200593 03/13/91 03/11/91 4136 $653.00 Daniel Hernandez, Jr.
BM300466 03/28/91 03/25/91 $6,250.00 Marcelo Rodriguez Jr.
BM200593 03/28/91 $1,000.00 Unknown Math Error? 3/28 DM of $1,000
BM102605 04/04/91 04/04/91 1430 $310.00 George A. Maciel from acct 200593
BM102605 04/04/91 04/04/91 CM $12.00 Reject Charge Rev.
 - 86 -

1991 DEPOSITS RESULTING FROM NON-TAXABLE ITEMS
Deposit Check Check
Bank Account Date Date Number Check Amount Payor Check Memos Comments
BM300466 04/22/91 04/22/91 CM $4,000.00 Reversal of 4/19/91 Transfer
BM200593 04/26/91 04/05/91 306 $200.00 Merced Rosales
BM200593 04/26/91 04/10/91 4160 $653.00 Daniel Hernandez, Jr.
BM300466 05/09/91 04/09/91 40697 $3,721.86 Adriatic Insurance Company Collision Final Redeposit
BM200593 05/21/91 05/15/91 33460 $122.95 Stewart Title of California
BM102605 05/28/91 05/28/91 CM $12.00 Reject Charge Rev.
BM102605 05/29/91 CM $1,500.00 Phone Transfer from acct 300466
BM200593 06/13/91 06/10/91 4202 $653.00 Daniel & Cecelia Hernandez Jr.
BM200593 07/09/91 07/01/91 4207 $653.00 Daniel & Cecelia Hernandez Jr.
BM300466 07/18/91 07/12/91 126 $100.00 Collette M. Krull Loan
BM200593 08/05/91 $1,000.00 Unknown Returned ck 8/9 DM $1,000
BM102605 08/13/91 08/13/91 1056 $500.00 GM Investments Sprint from acct 3171
BM303171 09/06/91 09/06/91 DM $12.00 Reversal of Ck Charge
BM102605 09/09/91 09/07/91 163 $2,000.00 George A. Maciel
BM300466 09/24/91 09/02/91 4033 $653.00 Daniel Hernandez Jr.
BM300466 09/24/91 09/13/91 $11,613.00 United States Treasury Tax Refund
BM300466 09/24/91 09/23/91 1416 $1,000.00 Daniel Parquette Aug & Sept Rent May have bounced - 10/1 DM
"Insuff Funds" - debit memo in acct
BM200593 10/08/91 09/23/91 1416 $1,000.00 Daniel Parquette Aug & Sept Rent 0466
BM303171 10/16/91 10/10/91 4005 $653.00 Daniel Hernandez OOPS
BM303171 10/16/91 10/11/91 1428 $1,500.00 Daniel Parquette check bounced
BM200593 11/22/91 168907 $150.00 Electric & Gas Industries Asso Refrigerator Rebate
BM300466 12/30/91 12/14/91 4306 $653.00 Daniel Hernandez Jr.
BM300466 12/30/91 12/30/91 CM $20,000.00 Telephonic Transfer From BM 0593
1991
TOTAL $74,180.81

1992 DEPOSITS RESULTING FROM NON-TAXABLE ITEMS
Deposit Check Check
Bank Account Date Date Number Check Amount Payor Check Memos Comments
BM300466 01/23/92 01/11/92 4338 $653.00 Daniel Hernandez
BM300466 02/06/92 02/07/92 685 $700.00 Ricky or Ana Flores Bounced - 2/14/92 DM
BM102605 02/12/92 02/10/92 1077 $3,500.00 GM Investments Advertising Sprint Car from acct 303171
 - 87 -

1992 DEPOSITS RESULTING FROM NON-TAXABLE ITEMS
Deposit Check Check
Bank Account Date Date Number Check Amount Payor Check Memos Comments
BM200593 02/12/92 02/10/92 4359 $653.00 Daniel Hernandez Jr.
BM303171 02/12/92 02/10/92 180 $3,500.00 George A. Maciel from acct 300466
BM200593 02/26/92 02/25/92 216 $500.00 Collette Krull
BM300466 03/03/92 03/03/92 CM $100,000.00 Balance from COD #001291269
BM300466 03/04/92 03/02/92 4373 $653.00 Daniel Hernandez
"Not used for intended
BM300466 03/04/92 03/03/92 5437 $136,945.68 Cashier's Ck to Santa Clara Title Co purpose"
Residence Service
BM200593 04/01/92 03/11/92 61741206 $369.44 AT&T Refund BM200593
BM102605 04/07/92 04/07/92 184 $7,500.00 George A. Maciel from acct 300466
BM200593 04/16/92 04/10/92 4395 $653.00 Daniel Hernandez Jr.
BM200593 04/21/92 04/21/92 CM $4,000.00 Dad's Enterprises Transfer
BM200593 05/15/92 05/10/92 4417 $653.00 Daniel Hernandez Jr.
BM300466 05/15/92 03/20/92 8140454 $7,657.22 California Land Title Co. Escrow No. 331486-LM
BM300466 06/03/92 06/03/92 CM $100,000.00 Balance from #01-201318
BM303171 06/12/92 06/06/92 4433 $653.00 Daniel and Cecelia Hernandez
Payable: Newark Truck &
BM102605 07/06/92 06/25/92 397 $614.00 San Jose Equipment Sales #291 Repairs Body/Bounced
BM300466 07/23/92 07/10/92 4466 $653.00 Daniel Hernandez
BM300466 08/25/92 08/10/92 4493 $653.00 Daniel Hernandez
BM300466 09/08/92 09/08/92 DM $0.17 Deposit Correction
BM300466 09/23/92 09/11/92 $16,895.00 United States Treasury Tax Refund
That's All Folks! Thank
BM300466 09/23/92 09/12/92 4534 $653.00 Daniel Hernandez You
BM300466 10/21/92 10/13/92 1135 $10,381.17 First American Title Insurance Escrow No. 208810AM
BM102605 11/10/92 11/10/92 CM $5,000.00 Transfer from acct 1300466
BM200593 12/07/92 12/05/92 879 $700.00 Ana Flores Bounced - 12/15/92 DM
BM102605 12/23/92 12/23/92 CM $3,500.00 Telephone Transfer from acct 1300466
1992
TOTAL $407,639.68