The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian trust company caused a client to incur a $2.5m penalty after it mistakenly provided information not required by law to the Colombian tax authorities while valuing his investments at three times’ their previously-disclosed worth.

Justice Camille Darville-Gomez, in December 18, 2025, verdict revealed that Isaac Daniel Picciotto Kassin, a wealthy businessman, had declared the assets held by his Bahamas-domiciled trust as being worth $6.183m in both the 2016 and 2017 tax returns he submitted to his home country tax authorities. The valuation was based on the “historical cost” of acquiring the underlying operating companies held by the trust.

However, JP Morgan Trust Company (Bahamas), the trustee for Mr Kassin’s trust, failed to properly update its records to show that it was an entity that did not have to be reported or disclosed to the Colombian tax agency, DIAN, under the provisions of The Bahamas’ Automatic Exchange of Financial Account Information Act 2016.

And, in addition to inadvertently disclosing its clients assets, JP Morgan’s Bahamas affiliate compounded this error by valuing the trust’s assets at “market value” rather than the “historical cost” method employed by Mr Kassin.

As a result, it declared that the trust’s assets were worth $22.732m and $20.813m for the 2017 and 2018 tax years, respectively - providing valuations that were three times’ higher than those submitted to the Colombian tax authorities by Mr Kassin.

This “discrepancy” resulted in the latter having to pay a combined $2.516m in penalties and an “additional wealth tax”, and Mr Kassin sought to recover this sum from the Bahamian trust company on the basis that it had incorrectly disclosed his assets and over-valued them.

When no settlement was reached, the Colombian entrepreneur launched legal action in the Supreme Court against JP Morgan (Bahamas) alleging negligence and breach of fiduciary duty. Justice Darville-Gomez, in her verdict, rejected the Bahamian trust company’s bid to strike the claim out after finding there was sufficient evidence to suggest Mr Kassin’s claim has “a real prospect of success” and that it merits a full trial.

Internet research by Tribune Business reveals that Mr Kassin is involved in the wine business as president of the Colombian-based business, PDC Vinos y Licores – Casa Pedro Domecq Colombia, and as a director of the Chilean firm, Viña Undurraga. He is also named as president of the Chamber of Associated Industries of Alcoholic Beverages (CABA) and a founding member of the Colombo-Chilean Chamber of Commerce and Industry.

Justice Darville-Gomez’s verdict discloses that Mr Kassin settled the Bahamas-domiciled Cabo Verde Trust on July 13, 2016, as a revocable trust to hold his corporate ownership interests. Its main direct asset was a 50 percent equity interest in Rising Fawn Ltd, a Bahamian company that in turn owned a British Virgin Islands entity called Hampton Holdings. This latter vehicle owned 100 percent of the shares in various Chilean domiciled companies.

The investment structure was seemingly designed to give increased privacy and confidentiality, and better protect key assets owned by Mr Kassin and his family, from the threat posed by violent crime and political instability in their native Colombia. He disclosed the trust’s assets as being worth $6.183m for both the 2016 and 2017 tax years - a figure derived from the “historical cost” of acquiring the Chilean companies’ shares.

The Bahamas, in the meantime, passed the Automatic Exchange of Financial Account Information Act and brought it into effect on January 1, 2017. This legislation put into law The Bahamas’ obligations to comply with the Common Reporting Standard (CRS) - the global benchmark governing how nations exchange tax-related information with other jurisdictions.

JP Morgan Trust Company (Bahamas) and other Bahamas-based financial institutions were immediately required to comply with the Act and provide all information on client activities “reportable” under the CRS to the Ministry of Finance for passing on to their home country tax authorities. However, Mr Kassin’s trust did not fall into the “reportable “ category.

“In or around early 2017, the trust was classified in the defendant's [JP Morgan’s] records as being a passive non-financial entity (Passive NFE). A Passive NFE is an entity that is considered to be reportable for the purposes of the CRS,” Justice Darville-Gomez wrote.

“However, in or around early 2018, certain personnel of the defendant determined that the trust's classification should be updated in order to reflect ti being an active non-financial entity. For the purposes of the CRS, an Active NFE is an entity that is not considered to be reportable.

“Nonetheless, the update to the trust's classification was not made by the defendant's CRS team and, as a result, the trust continued to be classified on the defendant's records as being a reportable Passive NFE,” the judge continued.

“Consequently, although the trust was not reportable, the defendant, in its capacity as a reporting financial institution, reported its determination of the actual value of the trust to the Competent Authority [Ministry of Finance] on two occasions in August 2018 and in August 2019. The reports were then subsequently reported to the DIAN by the Competent Authority.”

The reporting error was then compounded by JP Morgan Trust Company (Bahamas) declaring the value of the trust’s assets to be more than three times’ higher than what Mr Kassin had disclosed. This “discrepancy” resulted in the Colombian paying a $2.224m tax penalty and $292,610 via an “additional wealth tax”.

Mr Kassin, in an August 27, 2020, e-mail told JP Morgan Trust Company (Bahamas) that it was in breach of the revocable trust agreement and responsible for the penalties he had incurred due to it “mistakenly reporting the trust's financial information to the Competent Authority without having any legal obligation to do so and against his alleged express instructions not to do so”.

He called on it to compensate him for the tax penalty, but JP Morgan’s Bahamas subsidiary argued in an October 12, 2020, e-mailed reply that there was no breach of the trust agreement and any talk of reimbursement was “premature”. It later informed the Ministry of Finance on September 2, 2021, that the trust’s information was submitted erroneously due to "an inadvertent, isolated administrative mistake".

Dissatisfied, Mr Kassin launched a Supreme Court legal action for alleged negligence and breach of fiduciary duty against JP Morgan Trust Company (Bahamas) on March 25, 2022, claiming reimbursement of the $2.5m tax penalty and associated costs and interest totalling a further $71,000-plus.

The Bahamian institution, in its defence, argued that Mr Kassin’s trust “sustained no loss” and that the Automatic Exchange of Financial Account Information Act 2016 protected it from his claim. It also alleged that he failed to “exercise reasonable care with his own tax reporting”, and then sought to strike out the claim on the basis it had no chance of succeeding and was “frivolous, vexatious, scandalous and/or an abuse of the process of the court”.

Mr Kassin, though, countered that “ the trust documents do not exonerate the trustee from what they have described as ‘inadvertent disclosures’. The trust documents specifically exclude acts of gross negligence and willful default… The tax penalty consequences were a direct result flowing from the trustee's gross negligence and/or willful misconduct”.

The Colombian said it had been agreed with JP Morgan executives that the trust and its assets would be valued based on “historical cost”, rather than the “market value” that the trustee used.

“Counsel submitted that the claimant was left in the dark regarding the filing of the respective reports until he received a ‘surprise notice’ in 2020 that provided him with very little time to comply with or seek to remedy the outstanding tax obligations alleged against him,” Justice Darville-Gomez wrote.

“As a result, counsel submitted that the claimant - having no assistance from the defendant on the matter, despite his invitation for the defendant's help - made and acted on his determination that his best course of action to mitigate his loss would be to pay the $2.2m settlement assessment amount required by the DIAN.. instead of trying to appeal it.”

However, JP Morgan Trust Company (Bahamas) continued to insist it was protected by both the Automatic Exchange of Financial Account Information Act and the trust’s governing instruments, and that the claim should be struck out.

“Therefore, the defendant's position as submitted by its counsel was that because the penalty was imposed on the claimant by the DIAN, which is the Competent Authority in the Colombian jurisdiction, if the penalty was determined correctly then it would be outrageous for the claimant to attempt to pursue recovery for his losses here in The Bahamas,” Justice Darville-Gomez.

Finding that Mr Kassin’s case “sets out sufficient facts, is coherent, and discloses legally recognisable causes of action”, she also ruled that “it is not frivolous, vexatious or wholly unsustainable. Nor is it an abuse of process”.

“On the pleadings, I am satisfied that the claimant's case is sustainable,” Justice Darville-Gomez ruled. “I do not accept that this case is frivolous or presents no substantial argument. Nor do I accept that the law on statutory immunity is so settled as to preclude inquiry. For these reasons, I find that the claimant has a real prospect of success and that there is a compelling reason for trial.” She thus dismissed JP Morgan’s strike-out bid.