AG James secured $4.5 million from travel booking company Fareportal, Inc. (Fareportal) and three of its affiliated travel companies – WK Travel, Inc., Jen NY, Inc., and Tripmama, Inc. – for failing to pay over a million dollars in state corporate taxes. An investigation by the Office of the Attorney General (OAG) found that the companies violated the tax provisions of the New York False Claims Act by concealing millions of dollars of taxable dividends from the state’s tax authorities. The companies intentionally misclassified those dividends as “management fees” paid to a separate company, Magic Travel, LLC (Magic Travel), which had the same owner as the travel companies. The travel companies then deducted the sham fees from their income to make it appear that their taxable profits were far lower than they actually were, which allowed them to avoid paying more than a million dollars in taxes.   

“New Yorkers’ taxes help support our roads, trains, and airports – the same infrastructure that travel agencies like Fareportal depend on for their success. Fareportal and its affiliates operated a brazen scheme to avoid paying taxes, and now they are being held accountable. My office has zero tolerance for tax dodgers, and we will continue to use every tool at our disposal to ensure all New Yorkers pay their fair share.” -AG James