Silver-hair Oswaldo Villalobos with one of his lawyers. Photo from A.M. Costa Rica/José Pablo Ramírez Vindas
We posted back in Aug, 2009 (Government Get Sued) and Dec, 2009 (Investors Suing Costa Rica Government) thats when the Canadian investors formed a group to sue the government of Costa Rica in an attempted to recoup money lost in the Villalobos Ponzi scheme they would probably lose … they did in arbitration this past week.
About 200 creditors had organized (out of the 6000 who had invested) and sought $200 million dollars in damages from Costa Rica’s government, claiming they did not exercise sufficient oversight to prevent Luis Enrique and Oswaldo Villalobos from taking over $1 billion in a 20 plus year unregulated load scheme. The scheme also involved drugs in Jaco and a business center in San Pedro. The IRS also got involved investigating Americans who had invested.
The Villalobos investment scam paid up to 3.5 percent a month on deposits of $10,000 or more that started in the late 1980s; some put in millions. After a landslide of complaints, finally, in late 1990s the judicial department started to investigate which lead to the conviction and sentencing of one of the brothers, Oswaldo who got 18 years. The other, Luis Enrique Villalobos Camacho, fled the country and still is a fugitive, convicted of fraud and illegal banking. His whereabouts is unknown.
The arbitration was before a three-member panel at the International Centre for Settlement of Investment Disputes in Washington, a World Bank agency. The case was almost immediately rejected on jurisdictional grounds and the panel never heard the main arguments that creditors wanted. So they have been crying foul all week.
The plaintiffs argued, and blame Costa Rica for overacting and conducting a police raid and freezing bank accounts, that drove the brothers out of business; which in our opinion was grabbing at straws, since the government had been under presser from investors for years. If anything they [government] acted way too late.
The main jurisdictional defense was, the Villalobos investment business was not licensed by the government but it was only a personal interest where transactions and/or investment deals were among friends, so it did not follow under Costa Rica Security and Exchange laws, which have numerous flaws. In other words, “Buyer Beware.”
The legal team for the creditors was the Canadian firm of Cain Lamarre Casgrain Wells and would have received a percentage of any settlement, that could have amounted to millions of dollars.
However … I would not feel to sorry, the law firm did not get burned as 99% of the investors did. They still walked away with over $500,000 that was raised by investors as retainer money to start the lawsuit eight months ago.
Not a bad “win” for any law firm whose lawsuit was bound to fail from day one.
Hello i have a quick question does anyone suspect that the villablos brothers were killing some of the investors and getting the stories covered up?
Johnny, it’s been near three months since I asked you this question, ‘-when was the last time that you spoke with LEVC ?’ If you have shared with with this delightful character, did LEVC mention if / when he will return to his creditors all of their investments ?
Do share, Johnny. Do share.
Johnny, you failed to respond to my last query, when was the last time that you communicated with LEVC.
I must ask you a second time Don Juan, when was the last time that you spoke with Don Enrique ? Was it this year, or some year’s back……………
Earth to Johnny ! Earth to Johnny ! Hoot us back,
if you will!
John Manners, it’s been, give or take, 2.5 yrs. since you posted a message from LEVC. Has he communicated with you since then ?
As far as I know the group lawsuit was uccr; and there are other individuals if they got an international lawyer. Supposedly, those people recently received a return from the court. Other than that, 10 years is up in 2; and villalobos can return to cr; and hopefully return all the money all of us other losers lost.
Hello,
I’ve been following this case off and on since 2002, more “On” since 2008 when my Mother and Grandmother both passed away, they had a large sum of money invested w/the Villalobos Brothers. Can anyone kind tell me this really means?, is there any other lawsuit in the works, or was that it?
Thanks