Costa Rica Expertise LLC

The Gringo never even saw it coming

By Garland M. Baker
Special to A.M. Costa Rica

A U.S. citizen returned to Costa Rica in February 2003 to find his lawyers living in his Pacific coast villa. They had taken all his possessions and burned them to complete the takeover.

A criminal court case ensued, and the lawyers won. They got away with transferring millions of dollars in real estate to different companies to cover their tracks of plunder.

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The shysters had so much audacity they offered the U.S. citizen a mere pittance to drop his case during the proceedings because they said they had buyers for his property and if he did not accept he would get nothing in the end.

They were correct. He did not accept the absurd offer and now has nothing to show for his investment in Costa Rica.

How is this possible? How did the lawyers win?

This scenario was possible because The U.S. citizen made the same mistake many newcomers and old-timers make. They let lawyers put strangers on all the company paperwork that holds their property.

In many cases, people come to Costa Rica and buy a company from a legal professional where the attorney assigns his or her office staff to the important board of director positions. The law office’s gardener could be the president, the maid is the secretary, and the messenger is the treasurer. Any one of them or all of them could hold a full power of attorney.

People do this for a variety of reasons. Here are two that top the list: The legal professional talks them into this kind of arrangement because it expedites their work or they have ulterior motives. Or the client is trying to hide assets from their home country’s tax authorities, wife, judges, or for other reasons.

The lawyers won because the law gave them the right to transfer the property using the full power of attorney they had in the company holding the property.

Most companies formed in Costa Rica give full power of attorney to the president and sometimes to the secretary and the treasurer. Usually the power is not restricted in any way and is for use individually versus jointly with someone else.

Articles 1253, 1254, 1255 and 1256 of Costa Rica’s Civil Code regulate powers of attorney. Mandate is another word used for a power of attorney, defined as a document giving an official instruction or command.

In the case of the U.S. citizen, his property was in a company that he bought from an attorney who used his office staff as the officers. Later, the man picked up the company from the attorney and gave it to another who put his office staff in control.

The new group devised and executed the transfer of the U.S. citizen's properties without his permission. The motive was money. Millions.

Someone other than the U.S. citizen was in control of his assets. He never had control over them, even though he was always under the impression he was in control. He had no stock certificates or company books or any other documents to show he was involved in the firm.

The professionals the U.S. citizen trusted took advantage of him. They turned out to be nothing but sharks.

A.M. Costa Rica is not going to name anyone in this case because the lawyers would certainly sue even though the case is fully documented in the courts.

As property values skyrocket in Costa Rica, corruption has spiraled out of control as well. The glitter of gold is changing this once simple paradise.

Garland M. Baker has been a resident of Costa Rica since 1972 and is now a naturalized citizen. He provides multidisciplinary professional services to the international community. Reach him at [email protected] Baker has undertaken the research leading to these series of articles in conjunction with A.M. Costa Rica. Copyright 2007, use without permission prohibited.

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