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Villalobos’ Fraud Trial Loses Priority

January 27, 2006

The trial against Osvaldo Villalobos – one of the two brothers from the Villalobos Brothers high-interest loan operation who is charged with fraud, money laundering and illegal financial intermediation – has no set date, or timeframe within which a date must be assigned, and has lost priority since Villalobos was released from preventive custody in May 2005, Justice Ministry spokeswoman Sandra Castro told The Tico Times this week.

 

Castro said the court has yet to assign a date for the Villalobos trial. Trials where the accused is being held in prison have priority, she explained. Villalobos spent more than two years in detention, but was released in 2005 on a type of parole, effectively making his case less of a priority in the courts (TT, April 1, 2005). Luis Enrique Villalobos, Osvaldo’s brother and business partner, is sought by authorities in connection to the case; however, he disappeared with an estimated $800 million in investors’ money weeks after the police raided the brothers’ offices and home on July 4, 2002, seizing computers and documents and freezing $7 million in bank accounts (TT, March 14, 2003).

 

More than 6,000 people who had anywhere from $10,000 to millions of dollars invested with “The Brothers” suddenly saw an end to what loyal investors described as a 15-20-year run of on-time, monthly payments of 2.8-3% on their investment. In addition, their investment capital is now frozen or in Luis Enrique’s hands.

 

The Tico Times has yet to hear from a single investor who has received his or her money back from “The Brothers” or from a self-described private investigator and bounty hunter called Stephen Waitman. Last year, Waitman claimed to have located Luis Enrique and coerced him into returning investors’ money, with Waitman as the middleman.

 

In May 2005,Waitman took out an ad in The Tico Times saying he would hand over $500 million of investors’ money for a 15% commission (TT, May 20, 2005). He said he would bring Villalobos back to Costa Rica to face the justice systems after the payments to investors had been made. While some investors called him a fraud, others gave him the checks that were issued by “The Brothers” as proof of their investments, and paid him upfront fees of $50-$250.

 

In August, six weeks after the date he said he was going to pay the money to the investors,Waitman claimed that 1,800 people had given him their checks but because of a long series of complications, he had been unable to launch the operation from Costa Rica and had to move it to Panama.However, he assured The Tico Times, “I haven’t gone anywhere. I’m not going anywhere” (TT,Aug. 5, 2005).

 

Former staff reporter Robert Goodier, who had been covering the story for this paper and was in contact with Waitman, left the newspaper in December 2005, and Waitman has since refused to speak with The Tico Times. His immigration record shows he is still in Costa Rica.

 

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