In 2010, John opened an investment account with Randy Hansen, who held himself out to the public as an investment adviser and securities broker. John contributed $200,000 to the account in 2010. John provided Randy with a power of attorney to use the $200,000 to purchase and sell securities on John's behalf. John instructed Randy to reinvest any gains and income earned. In 2010, 2011, and 2012, John received statements of the amount of income earned by his account and included these amounts in his gross income for these years. In 2013, it was discovered that Randy's purported investment advisory and brokerage activity was in fact a fraudulent investment arrangement known as a Ponzi scheme. In reality, John's account balance was zero, the money having been used by Randy in his scheme. Identify the relevant tax issues for John?