Organized bells of real estate fraud threaten landowners in Costa Rica

With owners of expensive land kept out of Costa Rica due to COVID-19 restrictions, organized real estate fraud rings have enlisted corrupt notaries to steal properties.

At least 50 notaries public have collaborated with criminal groups to illegally transfer property or forge documents allowing them to be used as collateral for bank loans and credit cards, La Nación reported.

From October 2020 to March this year, nearly 100 complaints were filed in the capital of San José alone. Criminal groups target areas with high golimmovable, such as the Pacific coastal areas of Guanacaste and Puntarenas.

According to Walter espinoza, director of the Judicial Investigation Agency of Costa Rica (Organismo de Investigación Judicial – OIJ), criminals delimit the neighborhoods to find real estate that looks empty or abandoned, then talk to neighbors to glean information about the property and its owner.

SEE ALSO: Why courtroom corruption worries Costa Rica

The corrupt notaries then effect an illegal transfer of ownership, after which it can be sold or used as collateral.

“We have identified several organized gangs,” Espinoza said. “There are even sub-groups within groups that have established functions. For example, there are notaries, intermediaries and imitators, among others. “

InSight Crime Analysis

The level of organization and the number of corrupt notaries in recent property thefts in Costa Rica suggests that criminal groups with experience in this type of property fraud saw rich potential with the pandemic.

Costa Rica’s large expatriate property owner community has long been a key target for property theft, as many owners regularly spend time outside the country. Travel restrictions, border closures and fear of flying amid the pandemic have left their properties unattended for long periods of time.

Expert in real estate law in Costa Rica Alan garro writes on its website that their absence benefits fraudsters, as one of the ways for them to target foreigners who are abroad is through the use of the arrival and departure registers, which are publicly available in Costa Rica .

Another factor that makes this type of fraud possible is that title deeds are registered and centralized in the national registry of Costa Rica, where corruption can also take place, according to CostaRicaLaw. The national register and notaries work under “fe pública(Public Faith), a legal code meaning that anything recorded should automatically be taken at face value, unless proven otherwise in court.

As a result, the criminals even rented out properties and then assumed the identity of their owners using fake ID cards, according to CostaRicaLaw.

SEE ALSO: Shark loan grows in Costa Rica using drug trafficking

Authorities in Costa Rica have already dismantled groups dedicated to real estate fraud. In 2017, an IJO operation detained 39 members of a network that included lawyers, notaries and accountants. The ring was responsible for significant losses for individuals, businesses and state banks, Nicaraguan media reported La Prensa.

In addition, victims often have to negotiate legal processes which are costly and can take eight years on average to solve. These processes are particularly lengthy for non-citizens, whose cases are usually low priority.

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About Matthew Berkey

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