Corruption in the Courts

Uncovering Property and Title Fraud in Costa Rica: How Corrupt Networks Target Foreign Owners

Costa Rica has long been a popular destination for foreign investors and expatriates seeking to own a piece of paradise. However, beneath the country’s lush landscapes and tranquil beaches lies a serious issue that threatens property owners—title fraud. Corrupt rings of lawyers, notaries, and even judges have been exploiting legal loopholes and weak enforcement to unlawfully transfer ownership of properties, often preying on absent foreign investors. In recent years Costa Rican nationals, some Europeans, and other unscrupulous scammers have been circling the opportunities for property theft in Costa Rica.

The Rise of Property Fraud in Costa Rica

Title fraud is a growing concern in Costa Rica, particularly among foreign property owners who are often unaware of the legal risks associated with their assets. Organized crime networks have infiltrated the legal and judicial systems, using fraudulent documentation and corrupt officials to seize ownership of valuable land. The process typically involves:

1. Identification of Vulnerable Properties – Fraudsters target properties owned by absentee landlords, foreign investors, or deceased individuals whose heirs may not be aware of the property’s status.

2. Collusion with Notaries and Lawyers – Corrupt notaries create fraudulent property transfer documents, while unethical lawyers ensure that these documents appear legitimate.

3. Judicial Manipulation – With connections inside the judicial system, these criminal networks can fast-track fraudulent ownership claims or delay legal challenges from rightful property owners.

4. Property Resale and Laundering – Once ownership is fraudulently obtained, the criminals often sell the property to unsuspecting buyers, sometimes laundering the proceeds through multiple transactions.

Notable Cases of Title Fraud and Judicial Corruption

The "Madre Patria" Mega-Case

One of the most significant property fraud cases in Costa Rica, known as "Madre Patria," came to light in June 2024. Authorities arrested 35 individuals, including a Spanish national believed to be the ringleader, along with several lawyers, notaries, and even a judge. The scheme involved fraudulent registrations, money laundering, and corruption in property transactions. (Read more on The Tico Times). In the recent "Madre Patria" case, Costa Rican authorities arrested 35 individuals involved in a property fraud and money laundering scheme. Among those detained were several legal professionals, including notaries and lawyers. The alleged ringleaders are two Spanish nationals with the surnames Gómez González and León Muñoz. The legal team reportedly included a lawyer named Martínez Parada, who collaborated closely with the organization. Other legal professionals involved were Fernández, Berrocal, Seeman, Rojas, and Leiva. Additionally, notaries González Jiménez, Mora Bonilla, González Pinto, Garita Quirós, Prendas Matarrita, and Castro Segura were implicated in the fraudulent activities. A judge from Desamparados was also arrested for allegedly providing legal advice to the criminal network. These individuals are accused of orchestrating the illegal acquisition of approximately 300 properties, primarily targeting absentee foreign owners. QCOSTARICA.COM

This case highlights the importance of vigilance and due diligence for property owners in Costa Rica, especially those residing abroad. Regularly monitoring property records and collaborating with reputable legal professionals can help safeguard against such fraudulent schemes. 

Surge in Title Fraud During the COVID-19 Pandemic

With travel restrictions in place during the COVID-19 pandemic, many foreign property owners were unable to visit Costa Rica, leaving their properties vulnerable to fraud. Criminal networks took advantage of the situation by impersonating owners and executing unauthorized transfers. Reports indicate that these frauds intensified in recent years, causing financial losses and legal disputes. (Read more on Garro Law)

Government and Judicial Responses

In an effort to address judicial corruption and prevent further fraud, Costa Rica's Supreme Court passed the Judicial Sanctions Regime Law in December 2024. The law strengthens disciplinary measures for judicial misconduct, extends investigation timelines, and allows criminal evidence to be used in disciplinary proceedings. These reforms aim to curb corruption within the judicial system and restore trust in property transactions. (Read more on Costa Rica Law)

Despite these measures, tensions between the executive and judicial branches have escalated, with President Rodrigo Chaves publicly criticizing judicial authorities over ongoing corruption investigations. (Read more on El País)

How to Protect Yourself from Title Fraud in Costa Rica

For property owners and investors in Costa Rica, safeguarding real estate assets requires vigilance and proactive legal measures:

• Regularly Monitor Your Property Records – Check the National Registry (Registro Nacional) to ensure your property remains in your name.

• Hire a Trusted Local Attorney – Work with a reputable, independent legal expert to oversee transactions and legal filings.

• Secure Your Title with Additional Protections – Some legal services offer title insurance and monitoring services to alert you to any unauthorized changes.

• Be Wary of Unsolicited Offers or Legal Notices – Fraudsters often initiate contact with property owners under false pretenses to manipulate transactions.

Conclusion

While Costa Rica remains an attractive destination for property investment, the risks associated with title fraud and judicial corruption cannot be ignored. Foreign investors and property owners must stay informed and take proactive legal measures to protect their assets. With ongoing judicial reforms, the government is making efforts to combat corruption, but vigilance remains the best defense against fraudulent schemes.

Have you experienced property fraud in Costa Rica? Share your thoughts and experiences in the comments below.