The worst thing that can happen to you when moving to another country is giving your money to a thief.
I write blogs about Costa Rica real estate and investing in Costa Rica all the time. But I have never written one that explains about making an investment in Costa Rica giving your money to a thief or a scammer. Do your homework before you put your money in Costa Rica real estate or any investment company in Costa Rica who offers great returns on your investment (ROI).
We all know the expression “when it sounds too good to be true, it probably is”. Costa Rica is paradise, but it stops being that as soon as your investment turns sour. I would like you to see this blog as a general warning to make sure you do the right thing. Dont’ even think of giving your money to a thief. Do your homework before you make any investment in Costa Rica.
I love to read novels when I can find the time to do so. In many books, the thieves or terrorists will disappear with the millions to Costa Rica. Of course, we get our share of thieves and scammers. But Costa Rica is not some kind of cave where the bad guys can hide easily. Money laundering laws and bank regulations make it even more difficult.
How you meet a thief
You will find lots of nice people who will start a conversation with you in a coffee shop, a bar or a restaurant. Before you know it you will have made a new friend. It is not unusual to receive a great offer on an incredible deal that you should move on quickly. For an obvious reason, you will feel more comfortable to move on a deal that is offered by someone who speaks the same language as you do. If the offering party is a Spanish spoken person, you would think about it twice, am I right?
In the end, though, the result is the same. Giving your money to a thief who speaks Spanish or one who speaks your own language is the same thing. When you get this deal offered that sounds too good to be true, be careful. Do not believe what they tell you until you do your due diligence. Also, hire a good attorney to help you in this before you purchase or invest.
In my 30 something years of living in Costa Rica, I’ve seen my share of scams. Recently arrived in Costa Rica, my dad made his first investment in a local tea and spice factory. He later found out his partner used the money needed to invest in the company to put a new roof on his house.
Years ago, when I owned a spice packing plant in Escazu, I’ve seen companies selling shares or parcels in pepper plantations offering huge profits. When that all went down the drain, the macadamia plantations became the new hype. After that, it was teak investment all over. There are quite a few investors in Europe who lost their money in teak because the owners of the investment company disappeared, here is a good example of that.
The Villalobos Brothers
You’ll find that most of these investment schemes (or scams) will offer their deal to small investors who don’t have the financial capability for a lawsuit when the investors disappear. The Costa Rican law doesn’t know class action, of which the scammers take advantage. For many years, back in the 90’s, we had clients who rented mansions instead of buying a home in Costa Rica because The Villalobos Brothers paid 5% interest per month (yes, per month !) and they were shut down by the Costa Rican government.
Real estate developments
I have also seen my fair share of Costa Rica real estate and land scams that looked beautiful in the photos and websites but did not go any further because the developers disappeared before anybody could file a claim.
Watch out for Costa Rica real estate developments that advertise the best ocean views at bargain prices. When you see online ads of “fly and buy”, “buy now before the marina is built” or “purchase NOW before the airport is built” you should be careful.
Before you invest in a promising development that only exists on paper, please spend some time on doing our Developer Quiz.
Costa Rica is a beautiful country and a great place to live. But like in any other place on earth, there are always people out to make an easy buck. Be smart and investigate who you are doing business with. That way. you can save yourself the headaches and the money problems. Please learn from these samples I showed above.
Investing in Costa Rica real estate is a very interesting option but don’t give your money to a thief. Invest with the right people. And I mean those that give you a secure investment and the right ROI.
Avoid making an investment in Costa Rica without giving your money to a thief, contact our American European affiliate agents now.