Owning Private Property a Risky Proposition
Property fraud is one of the most lucrative and least investigated crimes in Costa Rica. Criminals cherry-pick properties from the National Registry and resell them to unsuspecting buyers, reaping huge profits.
Seeing a wave in this white-collar crime, the company Private Property Registry (PPR) set up shop last year to nightly check clients’ property in the National Registry and potentially intervene on their behalf in case of fraud.
Abraham Weisleder, PPR’s general manager, spoke to The Tico Times in his office in Rohrmoser, a suburb northwest of San José, about the severity of property fraud in Costa Rica.
TT: Why does the Private Property Registry exist when there is the public National Registry?
AW: The National Registry is a very efficient institution, despite what everybody thinks … Actually, for Latin American standards, the National Registry is quite good. Still, it does have over a million properties to protect and (that’s) not its function. Its function is only to register what’s going on.
Do you have any idea of the magnitude of property crime here?
The authorities don’t even know that. Not the National Registry or the OIJ (Judicial Investigation Police). There’s an average of about one property (fraud) a day. Some years there are less, some more. In one case alone, there were more than 100 properties involved. Normally the targets for these crimes are not the less wealthy people in Costa Rica. So it’s not as big … news to say that somebody stole from the rich than to say that somebody stole from the poor.
Also, the number of property fraud cases is not as big as for other crimes, such as robberies. But the dollar amount is much higher.
Currently it is not known how many rings are doing this.What has been reported in the papers is that these rings actually sometimes … involved more than 20 people, ranging from notaries to a private bank manager.
Who are the targets for this type of crime?
Foreigners … are somewhat more exposed to this because … they can’t keep track of what’s going on with the property if they live outside of the country for part of the year.
Who are the ones committing property fraud?
The most common way to commit property fraud is through a corrupt notary. That notary could prepare a document saying the property owner is selling to a particular buyer and forge the owner’s signature. The National Registry accepts the document because they have no basis to presume it’s not true. Another way to commit property fraud is to forge another person’s ID and claim that you want to sell
that person’s property.
How can people prevent being the victim of property fraud?
Check our Web site, www.propiedad segura.com, to see if the property has been purchased before and if we are checking it. If so, don’t buy it. Or, contact us and see if the owner really wants to sell it. Look 10 years in the past and try to find the history of transactions for the property. If it has exchanged hands up to five times in less than six months, for example, it may be a stolen property. Title insurance companies can also ensure that you are buying something legally. Also, place your money in a trust and transfer it to the seller only after all the proper documents have been inscribed and annotated in the National Registry. That will ensure notaries or lawyers have completed their end of the transaction, without turning around and selling the property to someone else.
How do you know if you are dealing with an honest notary or lawyer?
You don’t, and you can’t. It’s a matter of trust.
How do you protect your property from fraud after its purchase?
Every day you look for the property in the National Registry. That is a terrible lot of work – terrible as in hours spent as in boredom. Don’t do that, let us do it. (PPR charges $143 per year to monitor one property. For clients with up to 10 properties, the company charges $295 a year.)
Editor’s Note: Abraham Weisleder’s father works as a notary at the National Registry.
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