Lawsuit over Trump tax evasion in Panama takes a strange turn

From suspicions of money laundering, to watching his name vanish from the building’s facade, President Donald Trump’s former property in Panama has long served as one of the main headaches for the president’s ongoing business struggles since his ascension to the presidency.

Now, an ongoing lawsuit threatens to open a new chapter in the saga of the former Trump Ocean Club property — and fresh questions about the building’s finances.

The building, over which Ivanka Trump helped oversee construction and development, transferred to new owners last year, with Trump’s name being removed wholesale from the building. Led by majority owner Orestes Fintiklis, the new owners recently filed a lawsuit in the Southern District of New York alleging that they’d uncovered financial records showing that the Trump Organization had spent years dodging Panamanian taxes.

As The Washington Post summarized:

In the filing, Fintiklis does not give a dollar figure for the amount of taxes Trump allegedly evaded. But he says his company could now face “millions of dollars in liability” if Panama demands that it pay the taxes Trump did not. Fintiklis also asserts that the Panamanian authorities have audited the hotel’s books and “identified the failure to withhold and pay income taxes relating to Trump’s management fees.”

The filing claims that the Trump Organization lied about salary expenses, amid other financial shenanigans, in order to limit its tax burden. Fintiklis added that the Trump Organization misled his company prior to the purchase, claiming that the building stood at the fore of Panama’s luxury hotel market — even though, the Post added, Fitinklis said it was in reality “falling to the bottom of the market.” (The Trump Organization has denied the allegations.)

Just last week, the case took a strange turn, this time hinging on what documents can or should remain confidential.

In a letter first flagged by Courthouse News’ Adam Klasfeld, the defendants’ lawyers alleged that the Trump Organization’s legal team had proposed that certain documents — or potentially all of them — remain confidential. “Based on our conversations with counsel, we suspect that Defendants’ aim is to designate every document produced as ‘confidential’ or ‘highly confidential,’ which would preclude Plaintiffs’ representatives from being able to look at key documents,” the letter read.

According to the plaintiffs’ attorneys, the Trump Organization is apparently “worried about Mr. Fintiklis disclosing some sort of secret marketing information” to other hotels. But the letter states that there’s no real reason for such a drastic step, and that the Trump Organization’s legal team hasn’t explained why the proposed “restriction is required or even standard practice for this case.”

The Trump Organization’s legal team didn’t take long to respond. In a short, two-page letter on Monday, the defendants’ lawyers wrote that the initial letter from the plaintiffs was an “improperly-filed letter brief.” They acknowledged that the two sides had reached “an impasse regarding” potential confidentiality, and suggested an “informal conference” to hash things out, which the judge scheduled for July 17.

The debate over keeping all documents in the ongoing dispute about potential tax evasion confidential is just the latest in a line of bizarre developments surrounding the former Trump Ocean Club property. Not only has the building been credibly accused as the site of massive money laundering operations, but last year a management scuffle broke out at the building, with the new management kicking out the Trump Organization wholesale. Shortly thereafter, a Panamanian law firm representing the Trump Organization issued a letter to then-Panamanian President Juan Carlos Varela threatening potential “repercussions” to Panama if the government didn’t intervene on behalf of the Trump Organization.

All of these developments culminated last October in the public removal of Trump’s name from the front of the building, the latest blow to both the president’s brand and his standing abroad.


Source: thinkprogress