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.

The Law Applies to All

Moving to Costa Rica means embracing a laid-back lifestyle and the famous pura vida vibe. It’s a refreshing change—forgetting about closed-toed shoes or maybe even shoes altogether. Seatbelts feel like relics of your old life, and paying cash to sidestep taxes might feel like just part of the culture. Tipping in restaurants isn’t the norm here, so it’s easy to slide into the comfort of not tipping, even though you know servers earn a low hourly wage. And if you’re just visiting, that sense of freedom might be amplified. Suddenly, you find yourself considering things you wouldn’t dare at home: buying drugs on the beach, drinking and driving, or dabbling in other questionable activities. After all, what happens in Costa Rica stays in Costa Rica… right? Wrong.

It’s important to remember that Costa Rica has laws, and you are just as subject to them as any Costa Rican citizen. Whether you’re here on a tourist visa, as a retiree, a worker, a rentista, or a permanent resident, you’re expected to follow the same rules as everyone else. You might feel like you’re getting away with bending the rules because the legal process here can seem slow, but don’t let that lull you into a false sense of security. Costa Rica has extradition treaties with the United States, Canada, many European nations, China, and much of Central and South America. If you’re hiding out here to dodge legal troubles back home, it’s only a matter of time before it catches up with you.

If you assume Costa Rica’s reliance on paper records or the lack of a robust digital database makes it easy to slip through the cracks, think again. Times are changing. Respecting the laws of the land isn’t just about staying on the right side of the law—it’s about protecting yourself from serious consequences. Prisons in Costa Rica are reportedly grim, and breaking the law here could lead to deportation, extradition, a lifetime travel ban, or worse, imprisonment.

Many fugitives, including murderers, have been discovered hiding in Costa Rica. For example, there’s the case of the American yoga teacher who tried to evade justice by undergoing plastic surgery and living under the radar here. Or the husband who murdered his wife in the U.S. and fled to Costa Rica to start a new life with his young lover. Then there’s the doctor from the States convicted of sex offenses who is now back in prison.

In addition to these cases, countless individuals have been arrested for running, buying, and trafficking narcotics in Costa Rica. It’s worth noting that marijuana is not legal here, despite misconceptions by some visitors.

White-collar crime doesn’t fare any better. While tax evasion, fraud, or skipping out on paying bills may seem convenient in the short term, it will eventually catch up with you. Costa Rica may be known for its relaxed pura vida lifestyle, but it is not a lawless haven.

For those who have built a life in Costa Rica—friends, family, investments, or a community—breaking the law risks losing it all. And while the warmth and friendliness of Costa Rican people might make you feel at ease, don’t mistake kindness for weakness. The courts here are not particularly sympathetic to foreigners who exploit or disrespect their laws.

So, as you embrace the beauty and freedom of Costa Rica, remember that pura vida isn’t about living without limits—it’s about living with respect. Respect for fellow Costa Ricans, the environment, and the law. Stay mindful, follow the laws, and truly appreciate what this amazing country has to offer.

The 3 year lease!!!

Costa Rica has a unique minimum lease term of 3 years! That’s right, you read that correctly. If you sign a lease with a tenant for 1 year, 6 months, or 2 weeks it is not considered valid based on the General Law of Urban and Suburban Leases, Law No. 7527. The term minimum is 3 years for housing (art. 70). Although the contract indicates a shorter period, as it is a provision of public policy, it is considered not established and the 3 years will apply. Unless your property is registered with the ICT (Costa Rican Tourism Board) and your property is known as a holiday rental or short-term tourism accommodation. Otherwise, your lease no matter the terms is only recognized as a 3-year lease term by the courts in Costa Rica. When drawing up any lease, have an experienced lawyer look at it before signing anything. Make sure for any short-term lease you have the wording “vacation rental” written in your lease and make sure your property is registered with the ICT. This is the only way to protect you from a tenant outstaying their lease.

Basically, if you have a tenant who agrees to stay 3 months but then they decide not to leave, you cannot get them out. Particularly if the tenants continue to pay their rent every month, you will not have much legal ground to evict them. If you have a three-year lease term, you must notify the tenants in writing in advance of the lease expiration that you do not wish to renew the lease. Otherwise, the lease just self renews and you might be stuck with them for another 3 years.

Rent Scams

You manage to buy your dream house in Costa Rica and you hope to spend your winters or retirement there or perhaps you want to move the whole family down. You are not alone! Costa Rica draws dreamers, surfers, celebrities, and retirees alike to its equatorial beauty. Known for its green living, longevity, permanent sunshine, and pura vida (pure life). There are over 140,000 expats living in a country with a population of 5.1 million people. That’s almost 3% of the country comprising mostly people from the USA, Canada, and Europe seeking the sun and laid-back lifestyle of Costa Rica. There are 3 million visitors each year and so many of those that visit get the bug and start to dream of moving to Costa Rica one day.

Not only does Costa Rica attract dreamers, artists, body worshippers, nature lovers, surfers, and thrill seekers, it also attracts schemers, cons, and escape artists. Not to be harsh, but a good friend told me years ago when I first moved to Costa Rica, “Don’t Google the gringos!”. At the time it seemed like a funny aside or maybe a bit of xenophobia or resentment of the gringo invasion. Fair enough I thought. But time has proven it was more of a proverb to live by than a quippy comment. Do not Google the gringos because 5 out of 10 times you will find that your new neighbor has a past they are trying to forget.

Places like Costa Rica are dreamy and otherworldly and hold the promise of reinvention or escape. Most of us are wanderers, seekers, and explorers at the very least or we wouldn’t find ourselves far from home learning a new language and navigating torrential tropical downpours and outrageously potholed moonlike roads with no guardrails. Even the beaches, the world’s finest in my humble opinion belie the power and dangers of the rip. Costa Rica draws seekers who shirk the status quo and you are guaranteed to meet some awesome like-minded people. That being said it is also a haven for crooks and cons due to the anonymity of easy LLC forming here, a complete lack of addresses, and lax laws. One can disappear here or use it as an opportunity to take advantage of a whole new pool of victims.

When deciding to rent to anyone, do your research. Get references, run their background online, use a PI service, or even check with your local bounty hunter to find out if your potential tenants are legit. Rent scams are rampant, particularly in Guanacaste province which attracts the most expats (illegal immigrants depending on your politics).

Here are a few examples of popular rent scams;

1/Pay first and last month’s rent, then don’t pay again knowing that it may take months or even a year to evict a tenant. This is exactly why the new monetario arrendamiento law was created and allows for expedited eviction for non-payment of rent.

2/Provide fake rent deposit receipts. If you are a foreign owner meaning you do not have your residency, then you cannot send or receive SINPE which is an electronic transfer using your cell phone. Only residents of Costa Rica have this banking privilege and it is the most common form of money transfer there. So a tenant may scam you by showing that a deposit was made knowing full well that you cannot receive the funds. Insist that tenants send you a copy of the bank transfer via email each month and that it is not verbal, via text, and that it is not SINPE.

3/There are shady lawyers who will accept payment to bog down the eviction process for clients to get “free” rent. This means that if your rent is $3000/month some shifty unethical lawyers will take 50% on the terms that they will bog down the courts with useless paperwork and defenses buying the tenant time to stay rent-free at your property. That being said, the tenant still has to pay the lawyer the 50% (1500/month in this case) to buy them time. Either way, it’s a bargain for the renter while you do not earn any income for your property.

4/ Exorbitant or fraudulent repair bills can act as a shield or be deducted from paying rent. One horror story I heard was a tenant who claimed the pool wasn’t working properly and offered to call a repair person for the landlord. This seemed like a proactive helpful thing to do. But then the tenant showed up with a pool repair invoice for $15,000, essentially saying they have a $15,000 rent credit. This landlord could not prove the receipt was a forgery and was stuck with these tenants living rent-free while they litigated. For your knowledge, all repairs need be approved by the landlord and no permission should be given to the tenant to undertake and invoice for any repairs to protect you from this scam. If repairs are needed you have 10 business days to attend to them except in the cases of natural disaster.

5/Tenants might accept or agree to a short-term lease such as a “green season” lease at a reduced rate and then claim that your short-term lease is invalid and they are entitled to stay for 3 years under Costa Rican law. Thus getting a real rent bargain and prohibiting you from using your property as you see fit.

My best advice is to definitely Google the gringos and if that doesn’t turn up anything, dig a bit deeper. Check with their references, and go to their former landlords or employers. This can be tricky because many potential renters you will encounter are retired, self-employed, or independently wealthy. But you have to do your research. If they are from the USA or Canada it can be easier to find out people’s info, but if they are from another non-English speaking country consider using a VPN or searching in other languages to optimize your search. It may seem like a hassle or a bit too nosey but it will save you a headache in the long run.