2004News

Jaragua deal cost country millions

Events surrounding the managerial transfer of the Hotel Jaragua, which went from the Transamerican Hotel & Casino to the Marriott company, was done without the legal consent of the property owner, the Dominican state. This deal violated the lease contract and caused the Dominican government to lose millions, according to a report from the Hotel Industry Corporation (Corphotel) that was given to former President Hipolito Mejia in 2001. As reported by the Listin Diario, Transamerican sub-let the casino for US$600,000 per year and the Corphotel wants its money, claiming that the whole operation was illegal. Many details are unknown, however, as the amount that the Marriott chain is paying the Transamerican company is labeled “top secret” due to the fact it is part of a group of 100 hotels that Marriott took over for a global price of US$1.1 billion. It was also reported that the Transamerican Hotel & Casino collected US$9.1 million in insurance after Hurricane Georges, moneys that should have gone to Corphotel. In spite of the report, the former legal advisor to the President, Guido Gomez Mazara, okayed a lease extension that added five years to the original terms, a fact that was confirmed by Jose Lois Malkun in December 2002. Among the many complaints contained in the Corphotel document is the fact that the original lease required the Transamerican company to pay the government 10% of the casino’s net profits every year, something that has yet to transpire.