Top Puerto Rico Luxury Hotel Targeted in Tax Evasion Case

The administrators of a top luxury hotel in Puerto Rico have been arrested and charged in a tax evasion case as the U.S. territory cracks down on corruption amid a worsening economic crisis, officials said Monday.

The island's Justice Department said Wilhelm Sack and Harold Davies Mayne of the Horned Dorset Primavera are accused of withholding more than $600,000 in room occupancy tax over the past six years.

The announcement comes nearly a year after the hotel filed for Chapter 11 bankruptcy as it struggled with nearly $1.7 million in debts, including more than $800,000 owed to Puerto Rico's Treasury Department and more than $320,000 owed to the island's struggling power company.

Sack is being held on $29,000 bond and Mayne on $232,000 bond. They are scheduled to appear in court March 14 for a preliminary hearing.

Adrian Santiago, the hotel's reservation manager, said he had no comment.

Melanie Matos, an attorney for Sack, told The Associated Press that negotiations were underway and the case is tied to an old debt being disputed in a local court and bankruptcy court.

"We hope that this can be rapidly resolved and are looking forward to giving the best service to the hotel guests," she said.

It is one of the most high-profile cases to date since authorities began pursuing suspected tax evaders late last year in an attempt to recover millions of dollars. The island government's liquidity has dwindled amid a nearly decade-long economic slump and it faces $72 billion in public debt that the governor has said is unpayable and needs restructuring.

Officials say Sack and Maynes are accused of withholding tax revenues owed to the island's Tourism Company from December 2008 to October 2015.

"Horned Dorset has been an institution for Puerto Rico tourism, holding us up high for decades in the international market," said Justice Secretary Cesar Miranda. "It's a shame they haven't met their tax obligations. ... We will pursue this case like any other."

The two men face a total of 174 charges.

The hotel in the popular tourist town of Rincon in western Puerto Rico has suites that go for up to $1,600 a night.

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Danica Coto on Twitter: www.twitter.com/danicacoto

By danica coto

Top Puerto Rico Luxury Hotel Targeted in Tax Evasion Case