Real Estate fraud is becoming a major problem in Costa Rica
Yesterday I had a meeting with an account who was involved in a huge development project on the Pacific Coast of Costa Rica. Anyway, to make a long story short, he asked me if I knew the guy who he had meant in Costa Rica. I shook my head, and my account proceeds to go to this guy’s website. The website was professionally done, looked legit etc etc.
Then my account took me to a another website where it showed this guy had twice been indicted on fraudulently securities in the US, and he was NOW selling real estate investment securities on his Costa Rica website.
When my account asked me if there was anything I could do about it? I responded, "Not Really!"
It is well-known that Costa Rica has attracted an increasing numbers of investors and people who want to retire and/or buy a vacation home/condo over the last few years. However, this has also sparked the increase in real estate and investment scams. It is said, that as many as 30% of all real estate deals may have some type of fraudulent dealings with them.
Most who do get scammed end up leaving with a very bad taste of Costa Rica. Or they think US legal system, hire an attorney, thinking of civil lawsuit and, get their money back. The next thing they know, its two years and thousands of dollars later and are in the same boat they started with.
Before one thinks about investing and/or buying one must realize two critical fundamentals of buying real estate in Costa Rica:
- Costa Rica Law is a complexity of the Rican legal system, which is based on Napoleonic law. In other words, unless blood is drawn, “No (physical) Harm, No Foul. ” So fleecing someone out of money is not that big of a deal as it would be with someone who empties a 9mm clip into some poor soul. So if you get burned, do not expect an army of DAs and Law Enforcement to arrest the person. Going through the courts in a civil matter cost time and money.
- There are NO governing laws for real estate agents as the US has, where one has to take a test to become a realtor, agent or broker. In Costa Rica, anyone can become one and you do not have to be a resident or citizen. No permits, schooling or business license required. And because of this, agents are a dime a dozen and all they need is property, regardless of who owns it.
Getting back – you fell in love with the country, found the perfect spot to build or buy your dream home, now, how can I protect myself? Well believe it or not, there are some simple steps.
Property Itself: Make sure the property does not look abandoned or not taken care of. These properties would be "attractive" for fraud as the owners are not checking their property situation.
Residency Citizenship Cards can help give creditability to the person you are dealing with.
Residency Card: You found an agent who looks to be not a Costa Rican and want to put a proposal on that dream home, asked the agent for their residency and/or citizenship card. Both will tell you how long the person has been living in Costa Rica. You may even ask for their Passport. If they have no card that means every 90 days they have to leave the country and then come back in after 72 hours. A Residency Card will pretty much tell you that person is here to stay in CR. The longer the residency, the more creditably that person has. If the person balks at showing his or her card, time to walk out the door.
Internet Search: Go to Google and type in the persons and business name; see if any claims have come up on them.
Get a Real Estate Attorney: Costa Rica has some great attorneys that understand the system. The US Embassy in San Jose has a list of bilingual attorneys and you can go to our Costa Rica attorney directory. A good attorney will do the due diligence to make sure the property has a clean title with no liens attached. A property with a very long clean history means they have belonging to the same person for decades. Properties were the titles have changed many times in the last few years are ones that raise red flags.
Use Caution: If the property is located in zones with high appreciation values be careful. Real estate in high dollars areas like in the Central Valley areas of Escazú and Santa Ana, to North Pacific coastal areas (Guanacaste like Tamarindo) and to Mid Pacific Coast, like Jaco are the perfect places for a conman to hype their victim on, how much money they can make on this "awesome" condo project that will start construction two years from now.
When all said and done, if you take your time, don't rush things, do your homework, you will be able to have your dream home and/or make money on your real estate investment.
For more info see: Investing in Costa Rica, Costa Rica Squatters, Buying Property in Costa Rica
This thing has run its course. Obviously, there will be no further updates from HM management. Turn out the lights, the parties over … Dandy Don …
We are trying to expose scammers in Costa Rica and found a legal loophole to print articles about them. If you are interested in us printing your story please email Dan at info@costaricascams.com
The only one retiring on HM land is going to be the snakes and lizards. Put a fork in this HM drama and realize that so many real estate projects have gone bust, what would make this one any different. Hope gone … Money gone … Dreams gone …
Hi, I'm another owner wondering what the status of my investment is. Anybody have any updates? This place was going to be our retirement home.
Maria. I am interested in speaking to you about this. How can I best reach you?
I got a call from Edward late last week and he told me that a big announcement is coming and financing has tentatively been arranged. Has anyone been to the project lately to see first hand if work is being done? Fingers crossed.
It's strange how the 300 investors are so silent. It's as if they don't even care that their money is allegedly gone. Maybe they had so much green, the loss isn't a huge problem for them. Maybe it's just looked at as a tax write off …. Sigh ….
The Twitter feed for Ed is down as well.
Bottom feeder Ed Sklar has removed ALL references to Hacienda Matapalo in his Linked In profile. Hey XX we are waiting for that March newsletter. Tick tock.
I think you "investors" are finally getting the message. It's all dried up. Just thank your lucky stars you didn't pay for your "properties" in full. None of you did that, now did you?
The La Gaceta – Government Newspaper lists government notices like, foreclosures, liens, and auctions of property – http://www.ticotimes.com/detail/link-6197.html
You guys are asking the federal authorities to do the due diligence that you yourselves should have done. If someone puts up a web site with a bunch of 3 dimensional drawings of a happy village, yet the land is nothing more than cow pasture, something should go off in your heads that this could be dangerous. Seay what you want, but it's over.
You guys are crazy thinking the FBI is going to get involved in a failed real estate project. Real Estate projects have failed everywhere. Just let David and Ed go about there merry way on to their next venture. One of these days they will get things right and an investor will actually get what they are promised. Just not this time.
There is nothing to see here. Move along. Money spent, hope gone.
@B Please check your link as it is broken. Just speculating, but I believe UTA still must foreclose and that is a process. From there it's even a larger process to decide a future for the asset.
@Admin or anyone who knows. Is there a web site in CR that tracks foreclosure activity?
admin, that was not a criticism, we appreciate that. Thank you. You have given people a platform to aire their thoughts and feelings. It has become a chat. Hope more people become enlightened through your blog and take action. Action speaks louder than words.
We normally only keep Blog comments open for about a year. And our Blog was only about Warning people about CR Real Estate fraud. However, the comments targeting HM have been ongoing and has become a chat … and we keep it open for that reason. Obviously this Blog has allow HM investors to express their feelings and facts, which is a good thing since no one else has done it.
The first comment about HM was one year ago. How much longer are you going to blog.
Think logically. When HM lost the property to UTA Capital they were not forthcoming with that information. The information was released because the Motion to Dismiss is public record. If UTA Capital was forthcoming they would have contacted the investors to inform them of the take over and about future plans for HM. Neither side said anything. UTA Capital is mute and HM is desprite, they will tell you anything. They are counting on you doing nothing. Time was up last year. http://www.miami@ic.fbi.gov Add yourself to the list. case: David Matluck/HaciendaMatapalo
Nothing will get done. These projects go bust every day. You invested money, they allegedly lost the money, now move on.
i file a complaint with FBI Miami David Matluck and HM also states Attorney office nothing will be done without hundreds of complaints
action is best not words. i Filed a complaint under David Matluck/HM nothing will get done unless all people who were ripped off will file. FBI Miami and FL state attorney office
Chatter does nothing. Act on your waords. I called and filed complaints under David Matlock and HM. with FBI Miami and FL state attorney nothing will get done unless all investors complain