The federal Attorney General’s office (PGR) will hear new evidence today in a case against United States President Donald Trump in connection with a failed luxury resort project in Tijuana, Baja California.
Jaime Martínez Veloz, the former head of the Commission for Dialogue with the Indigenous Peoples of Mexico, will present documents that he says prove that neither Trump nor his business partners had set up a trust that gave them the legal right to develop the abandoned project known as Trump Ocean Resort Baja Mexico.
Martínez Veloz, acting as a private citizen, first filed a criminal tax evasion complaint against Trump in October 2016, claiming that no profits from apartment pre-sales had been declared.
In 2006, the United States real estate firm Irongate purchased coastal land at Playa Bandera in the Playas de Tijuana district of the border city, where it intended to build 526 condo-hotel units in three 16-story towers.
Trump licensed the use of his name for the project and it was used in all of its marketing materials, but later claimed that he was not responsible for the development.
Units were pre-sold before construction began, generating US $32.5 million in revenues from buyers’ deposits. However, none of the proceeds were reported to Mexican tax authorities.
Ground was broken for the development but in 2008 it was hit by financial problems and the following year it was shut down. Around 250 apartment buyers, most of them from southern California, lost their money.
Shortly after, nearly 70 plaintiffs filed a lawsuit against Donald Trump, his children and the developer. They claimed that they were deceived into believing they were buying into a Trump project when Trump’s involvement apparently didn’t extend beyond the licensing of his name.
Nevertheless, Trump settled the lawsuit four years later although he denied any wrongdoing. The terms of the agreement were not made public.
Martínez Veloz told the newspaper Milenio that his motivation for filing his complaint were the insults Trump directed at the Mexican people during his 2016 presidential campaign.
“I’m not speaking on behalf of those who bought [condos] . . . nor is the complaint’s purpose of an economic nature. It has a legal and political intent and is in defense of national sovereignty,” he said.
Martínez Veloz broadened his initial complaint in January 2017 to allege that Trump had violated Mexican law because he bought property within an area that is restricted for sale to foreigners because of its proximity to both the border and the coast.
“I requested information about whether Trump, Ivanka Trump or Irongate . . . had applied for a permit to establish a trust, which is the only way they could sell land that’s within 100 kilometers of the border and 50 kilometers of the coast, which can’t be sold to foreigners,” he said.
“There is no record that these people applied to establish a trust or that they are part of a trust,” Martínez added.
Following the widening of the complaint last January, Martínez Veloz said that he heard nothing further from the PGR on the matter until March 26 when he was summoned to appear today.