Hotel Online 
News for the Hospitality Executive

Punta Cana Resort in  U.S. Rep. Charles Rangel
 Tax Scandal Unaware of  Flap
By Alfonso Chardy, The Miami HeraldMcClatchy-Tribune Regional News

Sep. 26, 2008 --Ground zero for the tax scandal involving U.S. Rep. Charles Rangel, D-N.Y., is a secluded high-end beach resort beside a two-lane road lined with lush tropical vegetation.

But Rangel is not a household name around here.

"Who?" said one of two young women staffing the reception desk at the Punta Cana Resort & Club when asked if she knew Rangel, who owns a beachfront villa at the resort and for which he allegedly failed to declare about $75,000 in rental income.

The scandal, front-page news in New York and Washington, has sparked a congressional investigation and calls for Rangel's resignation as chairman of the powerful House Ways and Means Committee -- the congressional panel that helps write U.S. tax law.

But here in Punta Cana, the exclusive beach resort of fine sand and azure waters, the Rangel flap has barely made a ripple.

Resort receptionists were amused when a reporter from The Miami Herald showed them a newspaper clipping about the case, but shook their heads when asked if they knew Rangel or heard of the scandal.

Punta Cana Resort & Club is a gated community dotted with bungalows, cottages and villas rising against a backdrop of bright green manicured lawns, palm trees swaying in the breeze, lush trees and beds of multicolored flowers. Occasionally, butterflies of multiple colors flash through the air, which faintly smells of citrus or night-blooming jasmine.

The receptionists declined to identify specifically which of the many homes visible from the front desk was the one shown in a recent photograph in The New York Times. They also referred the reporter to a public relations office in Santo Domingo.

A person who answered the telephone there said Punta Cana Resort & Club had "no information" and recommended a call to Rangel's office.

Rangel's press office did not return a call. But a Rangel attorney provided a fact sheet explaining the congressman's actions.

Until recently, the document says, Rangel was "unaware" he had been receiving "non-cash income" on his Punta Cana property that should have been reported on his tax returns. Punta Cana managers used the income to pay down Rangel's mortgage and never sent him money, with two exceptions: $2,094 "accidentally wired" in 2001 and $775 in June after the mortgage was paid.

Rangel has paid $10,800 to the IRS and New York state to cover back taxes. Nevertheless, the House Committee on Standards of Official Conduct has voted to investigate Rangel's finances and determine whether the congressman violated ethical guidelines "or any law, rule, regulation."

Enrique de Marchena Kaluche, president of the Caribbean Hotel & Tourism Association, defended the Punta Cana Resort & Club and Rangel in an interview with The Miami Herald.

"It is lamentable that a resort of great prestige is now involved in this situation," said de Marchena Kaluche, a Santo Domingo attorney who has clients with properties in the Punta Cana-Bavaro area. "It is also lamentable that the congressman, whom I met when I was very young in 1985, and who is a great friend of the Dominican Republic, is involved in this circumstance because he forgot to file his [income] declaration [from the property]."

De Marchena Kaluche said Rangel has been traveling to the Dominican Republic for years and is involved in fostering close relations between Washington and Santo Domingo.

"He does not deserve this vilification, at least for this matter," de Marchena Kaluche said.

Incidentally, resort receptionists and all others contacted at Punta Cana Resort & Club were bilingual, speaking fluent English and Spanish.

This is relevant because one of the reasons Rangel cited for not properly taking care of his taxes was his inability to understand Spanish.

"Every time I thought I was getting somewhere, they'd start speaking Spanish," Rangel told a Capitol Hill news conference earlier this month, according to The New York Times.

Rangel's statement rang hollow in Dominican tourist industry circles given the country's sophisticated services for wealthy foreign investors and visitors.

Rangel's lawyers said the people the congressman dealt with only spoke Spanish.

De Marchena Kaluche and an editor at Listin Diario, a leading newspaper in the Dominican Republic, agreed that while the Rangel story has received some coverage here, it has not resonated with the population because it has not been front-page news or a lead item on the nightly local TV news.

Dominican news media this past week played up stories about how the worsening U.S. economy might affect the island and whether the government is doing enough to combat drug traffic.

"The Rangel case has not been common knowledge in the Dominican Republic," said Julio Arzeno, a taxi driver who ferries international visitors to Punta Cana.

He read his first Rangel story when a client pointed it out to him in Listin Diario last week.

The story, which ran with a small picture of Rangel, said the congressman had decided not to resign.


To see more of The Miami Herald or to subscribe to the newspaper, go to

Copyright (c) 2008, The Miami Herald

Distributed by McClatchy-Tribune Information Services. For reprints, email, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. NYT,

To search Hotel Online data base of News and Trends Go to Hotel.OnlineSearch
Home | Welcome| Hospitality News | Classifieds| One-on-One |
Viewpoint Forum | Industry Resources | Press Releases
Please contact Hotel.Onlinewith your comments and suggestions.