Trump Organization Accused of Covering Up 'Unlawful Activities,' Evading Taxes in Panama By Former Business Partner

The Trump Organization — the name for a group of President Donald Trump's roughly 500 business entities — has been accused of tax evasion in Panama by one of the company's former business partners.

After the Trump International Hotel and Tower was opened in 2011, businessman Orestes Fintiklis purchased 202 of the hotel's 369 units six years later. Soon after, Fintiklis took the company to court alleging that their mismanagement of the hotel caused the business to suffer financially. Last year, the Trump Organization was ousted as managers of the establishment. The hotel is now the JW Marriott Panama.

In a new legal filing in Manhattan federal court on Monday, the owners of the hotel claimed that the Trump Organization "made fraudulent and false claims to the Panamanian tax authorities" in order to "cover up its unlawful activities," according to the New York Times.

The Trump Organization failed to pay taxes on fees it earned from managing the hotel and Panama tax officials became aware of these irregularities last year during an audit, the filing alleged.

The Trump Organization "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 filing said. The plaintiffs also accused the company of understating employee salaries to reduce the hotel's social security tax amount.

The plaintiffs did not specify the exact monetary figure that may be owed to them in the filing, however, they did suggest that the alleged conduct exposed the hotel's owners to millions of dollars worth of liabilities. Fintiklis, who owns a majority of the premise, is seeking roughly $35 million in damages.

The Times were unable to verify the allegations made in the filings which claim that the Trump organization failed to meet its obligations to ensure that all the hotel's taxes were adhered to and paid. Although Panama does have taxes on commissions paid to foreign companies, it is unclear whether the management fees in question qualified for an exemption.

In a statement to Newsweek, the Trump Organization denied the allegations and claimed that Fintiklis is merely "trying to distract from his own fraud."

"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 said. "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."

This story was updated to include comment from a Trump Organization spokesperson.

President Donald Trump, Trump Organization
U.S. President Donald Trump, gestures as he speaks during a news conference with Shinzo Abe, Japan's prime minister, not pictured, at Akasaka Palace on May 27, 2019 in Tokyo, Japan. The Trump Organization has been accused of dodging taxes in Panama by one of their former business partners. Kiyoshi Ota - Pool
Trump Organization Accused of Covering Up 'Unlawful Activities,' Evading Taxes in Panama By Former Business Partner | U.S.
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