Real Estate Fraud Investigation Continues

THE total amount of money involved ina national real estate fraud network beinginvestigated by the Judicial InvestigationPolice (OIJ) surpassed the $5 million markthis week as more and more investorsreported their counterfeit property deeds tothe Public Security Ministry.“The quantity of money involved inthis case is incalculable,” José Brenes, theOIJ agent in charge of the investigation,told The Tico Times. “Almost every daywe see more and more people showing upto report false property transfers.”The network, which was broken up byOIJ agents Oct. 26, was made up of 23people, including five licensed notaries,according to Brenes. At press time, 13people are under arrest as a result of theOct. 26 raids. Six remain at large, and theOIJ is seeking sufficient evidence for thearrest of four other people suspected ofbeing involved with the group.The organization allegedly carried outreal estate scams by finding properties notbeing occupied by their owners, obtainingthe necessary information about the property,falsifying property deeds and thenselling the phony documents to investors.At the time of the initial raids, the OIJhad listed 65 sites sold to 14 people usingfalse property documents. According to thedaily La Nación, one investor from theUnited States had purchased 35 propertiesfrom the group.“This was a case in which the notarieshad a direct involvement,” Brenes told TheTico Times. “Some of these people werewell-known in their circles; they had beennotaries for over 30 years.”In order to make a sale, the notaries hadto take the allegedly falsified deeds to theNational Registry for finalization of thesale and registration. National Registryspokeswoman Laura Quesada told TheTico Times that despite having to approveand finalize the property transfers, heroffice is not capable of making calls to previousowners to verify sales.“We will look into who these peopleare who are making the sale to make surethat they are not dead, but we’re not goingto call previous owners, because that issomething the notary is supposed to do,”Quesada said. “We don’t have the capacityto make these calls… We deal with 5,000property registrations each day.”Quesada said the National Registry isworking on a project that will incorporate“digital signatures” through direct e-mailcontact with previous property owners atthe time of sale, as well as the formulationof a database that will record informationand potential fraud histories of every registerednotary in Costa Rica to be used as a“red flag” system.According to Brenes, those looking tobuy properties must “be vigilant in learningabout the property, have everythingwritten down, make themselves aware ofcrime news and have knowledge of thenotary they are using.“The problem is that these people aretaken in by the notaries and trust them,”Brenes said. “They ended up losing everything.”The investigation into the total numberof frauds will take about six months,Brenes said. Those charged in connectionwith the organization could face a maximumsentence of 33 years in jail.