Trump Organization accused of evading taxes in Panama

The owners of a Panama hotel formerly managed by the Trump Organization alleged in a court filing that the firm created a “false light” around the hotel’s finances and dodged Panama taxes, according to The New York Times.

The owners of the former Trump International Hotel and Tower in Panama City, now a JW Marriott, claimed in Manhattan federal court Monday that the Trump Organization “also made fraudulent and false claims to the Panamanian tax authorities” to “cover up its unlawful activities.”


Panamanian tax authorities became aware of the irregularities during an audit last year, the filing claims. The plaintiffs allege the Trump Organization did not pay taxes on its fees for managing the hotel. Panama taxes commissions paid to foreign positions, and whether the Trump Organization was exempt from these taxes during its time managing the hotel is unclear, according to the Times.

Trump’s company, the filing claims, “used its control over the hotel bank accounts to make payments to itself and affiliates without withholding the 12.5 percent tax on its management fees, thus intentionally evading taxes.”

The plaintiffs further claim the Trump Organization reduced the hotel’s Social Security tax payments by understating employee salaries, making “the financial and operational performance of the hotel appear in a false light,” according to the Times.

The filing suggests the Trump Organization’s alleged conduct may have exposed the owners to millions of dollars in liabilities but does not identify any specific amounts owed or any time frame for how long it claims the organization failed to make payments.

Before the Trump Organization was removed as manager of the hotel last year, it was the only Trump hotel property in Latin America.

Orestes Fintiklis, whose companies control a majority of the hotel, is seeking about $35 million in damages from the Trump Organization, according to the Times.

"Once again Mr. Fintiklis is trying to distract from his own fraud and material breaches. The Trump Organization did not evade any taxes. To the extent any taxes were to be withheld, it was the responsibility of the condominium that owns the hotel," a Trump Organization spokesperson told The Hill. "The Trump Organization’s only role was to manage the property. We look forward to taking the depositions of Mr. Fintiklis and his partners and unmasking their fraud."