Newsweek - In June 2019, the owners of a Panama City hotel that was managed by Trump's businesses, and carried the Trump brand, accused two companies, Trump Panama Hotel Management LLC and and Trump International Hotels Management LLC, of not paying taxes on their Panamanian earnings.
In a filing to the U.S. district court in New York, private equity manager Orestes Fintiklis and his company, Ithaca Capital Partners, alleged that the Trump businesses failed to pay 12.5% taxes on the millions of dollars they earned from managing the Panama City hotel. They also alleged that the Trump units failed to correctly report the number of people the hotel employed so that he could avoid Panamanian social security payments.
The filing documented how the Panamanian government later conducted a tax audit on the hotel and found major irregularities. Fintiklis and his company were forced to pay the money Trump owed, the court filing alleged.
In an updated complaint filed in the same court on March 30, 2020, Fintiklis' attorneys complained that "had Trump been honest with Ithaca about its failure to pay taxes on the management fees it earned and its failure to properly report employee salaries to Panama's social security agency, Ithaca would have never entered into the [licensing deal] because, among other things, (i) Ithaca would have recognized the significant, multi-million dollar tax penalty that could be imposed by the Panamanian government once it started auditing the Hotel; and (ii) Ithaca would have known that the representations made by Trump described above were false in that the Hotel was suffering from significant financial irregularities."
The litigation is still before the courts.
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