The majority owner of the former Trump Panama hotel, who made headlines in March 2018 when he physically forced the Trump Organization out of the building using armed agents, is asserting that he has found documents proving the Trump Organization evaded Panamanian taxes.
The allegation comes from a new legal filing in the continued conflict between the Trump business and Orestes Fintiklis, an investor from Cyprus who owns the company that owns a majority stake in the hotel, which is now a Marriott.
According to the Washington Post, the filing, made in federal court in New York City on Monday, alleges that after the Trump Organization was ejected, Fintiklis was able to look at the hotel’s records and found that the company had not paid the 12.5 percent tax on management fees it collected. Fintiklis also said the company avoided some taxes by underreporting the hotel employees’ salaries. He didn’t say how much the tax bill would amount to, but he argued his company could face millions in liability if Panama comes seeking the taxes that the Trump Organization (which is still owned by President Donald Trump but run by his two sons) failed to pay. Fintiklis also said his company would not have purchased its share of the hotel back in 2017 if the Trump Organization had been honest about its failure to pay those taxes.
The Trump Organization denies the allegations, and it told the Post that withholding taxes is the responsibility of the building’s owners (Fintiklis’ company) and not the managers (the Trump Organization). “The Trump Organization’s only role was to manage the property,” the spokeswoman said in a statement to the Post. “We look forward to taking the depositions of Mr. Fintiklis and his partners and unmasking their fraud.”
Fintiklis and the Trump Organization are suing each other for millions in damages, each accusing the other of breaching their contracts. The Trump Organization has maintained that the owners had no basis on which to cut ties with the managers of the building. Fintiklis has argued that the Trump Organization misled the owners into thinking the hotel was thriving, when in reality it was not—and that the poor management practices of the Trump Organization along with the negative associations with the president’s name were driving the hotel’s business into the ground.
The conflict between the two sides began in 2017, when Fintiklis first became majority owner of the Trump Ocean Club in Panama City and started accusing the Trump Organization of mismanagement. The Trump Organization resisted Fintiklis’ attempts to fire the company, arguing that its contract was good until 2031, and finally in March 2018 Fintiklis called in his own security guards to evict the Trump staff from the building.
What followed was chaotic: His security guards tussled with Trump Organization security guards; Panamanian police arrested a Trump security guard for blocking their way to the hotel’s administrative office; Fintiklis himself barged into the hotel to try to fire nine Trump employees; Fintiklis failed to find the employees and instead sat down at a piano in the lobby to play Beethoven’s Für Elise, eliciting a round of applause from his employees; and finally, after what appeared to be a stalemate, armed agents evicted the Trump staff. A Panamanian judge ruled in Fintiklis’ favor, and the Trump name was stripped from the hotel.
After the drama unfolded, Trump Organization attorneys sent a letter to Panamanian President Juan Carlos Varela, according to the Associated Press, “urgently” requesting “influence in relation to a commercial dispute regarding the Trump hotel.” The letter warned that the Trump Organization was being mistreated by Panama’s justice system and that the country was at risk of violating a 1983 treaty between the two countries, the Washington Post reported in April 2018. The lawyers, who specifically worked for a Panamanian firm, said they sent the letter without the Trump Organization’s approval. Varela said he did not take any action as a result of the letter.