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These stories were published Monday, Jan. 13, 2003, in Vol. 3, No. 8
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Four local banks figured in scheme
Another scam allegation centers on San José
By the A.M. Costa Rica staff

The United States government has filed a civil fraud case against a Costa Rican company and three men it said defrauded investors of about $900,000 from November 1999 and July 2000.

The curious twist is that the men targeted people who had lost money in a previous scam with the false promise that they could help the people recover their money, said a Security and Exchange Commission statement last week.

The company is Asset Recovery and Management Trust of San José and individuals Frank R. Johnson, 63, and Milton E. Vaughn, 68, residents of Alabama, and Carlos Fernández Alfaro, a Costa Rican national, said the statement. The case was filed in Alabama Dec. 16 but just announced.

According to the commission's complaint, the defendants targeted victims of previous scams by claiming Asset Recovery would help recover their lost funds, and then lured them into joining the trust's fictitious programs. 

In particular, Johnson, who in 1999 had been convicted of defrauding investors in another prime bank scheme called the International Benevolent Fund Trust, directed his former victims to Asset Recovery, the complaint said. While awaiting sentencing for his role in the earlier fraud, Johnson told his victims that he had retained Asset Recovery to help them get back the money they lost in the International Benevolent trading programs, said the complaint.

Shortly thereafter, Asset Recovery sent those investors informational material and offered them the opportunity to participate in trading programs, claiming that its trading programs were safe because investor funds remained 

with the trust and could be withdrawn at any time, said the complaint. 

The defendants promised exorbitant returns on investments in these trading programs, claiming that they would have access to international trading banks, the mythical "prime banks," which they represented typically were available only to a select few with millions of dollars to invest, the statement said.

After the defendants received investors' monies, they transferred it to their own use and control, said the government. At least four banks in Costa Rica were used by the defendants to receive these transfers of funds, said the commission announcement. The commission listed these banks: Banco Bantec, Bantec Internacional, Banco BanCrecen, and Banco Cathay

The commission alleged that the individuals engaged in a number of misrepresentations including saying that the investors' funds would be used to trade debt instruments known as "bank debentures" and "standby letters of credit" through "world trading banks." Investors were told falsely that these instruments would provide returns of between eight to 15 times the principal invested, with complete safety of principal, said the complaint.

Fernández Alfaro, 45, is a resident of Costa Rica, was a co-founder of Asset Recovery and served as its chairman from at least December 1999 to March 2000, said the commission, noting that Fernández Alfaro also participated in International Benevolent with Johnson.

The commission told the court it seeks an injunction against the men involved and return of all the money invested with Asset Recovery. Such civil actions frequently are filed in advance of criminal charges.

Vehicle's driver flees then dies, too
Canadian citizen struck down on highway
By the A.M. Costa Rica staff

A Canadian woman died and a second Canadian suffered serious injuries when they were struck by a vehicle that swerved off the highway Sunday morning in Ciudad Neily in southwestern Costa Rica.

The driver of the car fled the accident but died seconds later when he drove his vehicle into a tree, said police.

A spokesman for the Fuerza Pública identified the dead Canadian as 34-year-old Janet Marchena. A man with her, Marvin Stevenson,
 

 suffered undetermined injuries and went to the Hospital de Ciudad Neily. The woman’s husband, Wilbert Marchena, was not injured, said police.

After the accident, the driver of the automobile fled the scene but some 500 meters from the accident (about a third of a mile) he failed to negotiate a curve, crashed into a tree and died, said police. They identified him as Alberto Delgado Soto.

Investigators said that Mrs. Marchena was born to Costa Rican parents in Canada and therefore had Canadian citizenship.

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Canadians get a rundown from the younger Nash
By the A.M. Costa Rica staff

The Villalobos case made the Hamilton, Ontario, Spectator around Christmas when a reporter interviewed Michael Nash, a lawyer in that city and son of investor Keith Nash.

". . . after three years of warning Costa Rica's large and quirky community of North American retirees that their favourite investment advisor might be a thief, the Hamilton lawyer can't help but feel some satisfaction as his persecutors suffer exactly the fate he warned they were facing," said the newspaper.


Reward and letters: BELOW!


Michael Nash is generally considered the man who kicked off the scrutiny of Luis Enrique Villalobos Camacho when he came to Costa Rica in 1999 to look after his ailing father.

Michael Nash sought to recover his father’s money from the Villalobos investment operation, but the financier, in a series of actions well known now, sought to have Keith Nash declared incompetent and himself named guardian.

Subsequent publication in The Tico Times in early summer of 2001 caused an uproar and may have contributed to a Costa Rican investigation that 

culminated in a raid on the Villalobos office July 4.

"We thought that if we splashed him all over the papers down there he'd give us our money and we could go away, but the outpouring of hostility that followed really fortified Villalobos," Nash told the newspaper.

"I thought it would cause a panic, but people came to Villalobos' defence like tigers," he said. 

Said the newspaper: "When banks were paying 4-5 per cent a year on deposits, Villalobos offered his friends an astronomical three per cent a month. The only rules were no contracts and no questions. Anyone who asked how Don Enrique could afford such largess had their money returned and was politely invited to leave."

The newspaper reported that the Nash legal action is continuing even though Villalobos vanished when he closed his office Oct. 14. He is now an international fugitive.

The story also reported the four of the younger Nash’s nine trips to Costa Rica to look after his father were paid for by Villalobos and that Villalobos considered Michael was a golddigger after his father’s money. Villalobos also paid some of the older Nash’s medical expenses, the newspaper reported.


 
El Pueblo is target of new immigration sweep
By the A.M. Costa Rica staff

Immigration officials and police turned their attention to the nightspots at El Pueblo Friday and detained 31 foreigners for deportation, including two U.S. citizens and two Italians.

The police action took place Friday night and continued into Saturday at the popular collection of dance spots and tourist stores in north San José.

Marco Badilla, director general de Migración y Extranjería said that the International Police Organization, INTERPOL, assisted with the operation and checked out persons detained against an international wanted list. But no international suspects were found, said a release from the Ministerio de Securidad Pública.

The ministry said that included in the operation were Policía Especial de Migración, agents from the robbery and minors section of the Judicial 

Investigating Organization, representatives of the Ministerio de Salud and investigators from the  Patronato Nacional de la Infancia.

In all, some 48 foreigners were questioned and of these some 17 carried documents that showed they were here legally, said the release from the ministry.

Some of the people detained had no documents. Others had expired visas or other irregularities, said the ministry. In all, police detained 15 Nicaraguans, two Peruvians, two Cubans, two Salvadorians, two Colombians and one person each from Panamá, Germany and Brazil, in addition to the Italians and the U.S. citizens, said the ministry.

Police came upon four minors who were in drinking establishments where they should not have been, said the ministry, adding that in addition, four members of youth gangs were identified.


 
Oil body approves 
increase in output 

By the A.M. Costa Rica wire services

VIENNA, Austria — The Organization of Petroleum Exporting Countries has agreed to increase production to 24.5 million barrels per day to cover a shortfall of oil from Venezuela, where a six-week strike has disrupted crude exports. 

Organization ministers, meeting in closed session, agreed to increase production by 1.5 million barrels per day. 

The oil minister of the United Arab Emirates said this would offset the shortfall in production resulting from the six-week strike in Venezuela, normally the cartel's third-largest producer. 

The emergency session was called amid deteriorating market conditions. Crude prices surged last week to a two-year high of $33 per barrel, well above the organization’s target price of $22-28 per barrel. 

The increase is to take effect Feb. 1, and will be reviewed at a regular meeting in March. 

Analyst Raad Alkadiri, of the PFC energy research organization, told sources that the oil cartel is also concerned about a possible war in Iraq. "[The organization] is dealing with the Venezuela issue and has a side eye on a potential war in Iraq and the kind of disruptions that might bring," he explained. "So, consequently, it is looking at a swing in production of somewhere around four million barrels a day at the worst, which means it needs to be flexible," he said. 

Venezuelan soldiers 
injure 19 protesters

By the A.M. Costa Rica wire services

CARACAS, Venezuela — Soldiers here have fired tear gas at tens of thousands of opposition supporters marching on a heavily guarded military base.

The military show of force injured at least 19 protesters, including a newspaper photographer hit by rubber bullets.

Sunday's march was in support of a general strike aimed at forcing President Hugo Chavez to resign or order early elections. The six-week strike has crippled Venezuela's economy and choked off oil production by what was once the world's fifth-largest oil exporter. 

Meanwhile, Chavez accused his opponents of being "fascists" in his weekly radio and television address Sunday. He also threatened to revoke the broadcast licenses of private stations that are fiercely critical of his rule. Chavez, who has refused to resign, vowed Saturday to break the general strike that began Dec. 2.

A protest at the military complex here Jan. 3 ended in clashes with Chavez supporters that left two people dead and more than a dozen wounded.

British teen becomes
youngest Atlantic sailor

By the A.M. Costa Rica wire services

ST. JOHN’S, Antigua — A 15-year old British schoolboy has sailed across the Atlantic Ocean and straight into the record books, becoming the youngest person ever to cross the ocean solo. 

A steel band played as Seb Clover sailed into English Harbor Sunday, 24 days after pushing off from Tenerife in the Canary Islands. 

He made the crossing in a 10-meter long yacht. 

Clover is from the Isle of Wight off southern England. 

He said the most spectacular part of his 4,300-kilometer-long (2,580-mile) adventure was seeing pods of whales and dolphins. 

He admitted that sailing alone across the Atlantic was frightening at times, but he said he enjoyed every moment.

Catholic Church-Cuba 
relations still stale

By the A.M. Costa Rica wire services

HAVANA, Cuba — The top Roman Catholic leader has said relations between the church and the island's Communist government have barely changed since Pope John Paul II's visit to the country five years ago. 

Cardinal Jaime Ortega told reporters Saturday that relations are essentially the same, and there are no real substantial changes. 

The pope visited the country in January 1997 sparking hope the government would adopt a more liberal policy toward the Catholic Church. 

But Cardinal Ortega said the church is still fighting to gain access to the state-controlled media. "There is silence on the church in Cuba," he said. The church also wants approval to open Catholic schools.

Opponents clash 
near Haitian palace

By the A.M. Costa Rica wire services

PORT-AU-PRINCE, Haiti — About a dozen people were injured, some seriously, when supporters of President Jean-Bertrand Aristide clashed with opponents trying to march on the National Palace. 

Witnesses say anti-government protesters were attacked Friday as they approached the center of the capital. Police fired into the air and used tear gas to disperse the crowds. 

The country has been the scene of anti-government protests in recent months, as students, trade unions and opposition politicians have taken to the streets demanding Aristide's resignation. 

The protesters have been angered over rising fuel costs and what critics say is the president's increasingly corrupt and authoritarian rule. 

Aristide, a former Roman Catholic priest, was first elected in 1990 but ousted in a coup a few months later. U.S. troops helped restore him to power in 1994. 

Since his re-election in November 2000, he has been locked in a bitter dispute with the opposition Democratic Convergence coalition over the May 2000 parliamentary elections that observers said were marred by fraud.

Leftists kill three,
says Colombian army

By the A.M. Costa Rica wire services

BOGOTA, Colombia — The army here said three soldiers were killed and three wounded in a car bomb blast set off by leftist rebels Sunday. 

The Army said it suspects the nation's largest rebel group, the Revolutionary Armed Forces of Colombia, set off the bomb, which exploded as soldiers were on patrol near the town of La Palma. 

Leftist rebels have been fighting Colombia's government for four decades. 

Doomed plane 
discovered in Peru

By the A.M. Costa Rica wire services

LIMA, Peru — Rescue teams have located the wreckage of a Tans Peru plane carrying 46 people, which disappeared two days ago in the country’s Amazon jungle. There appears to be no survivors. 

Rescue teams reached the wreckage Saturday morning, after two days of frustrating searches for the missing plane. 

The Fokker F-28 passenger jet was spotted Friday afternoon on the side of a mountain, 15 kilometers (about nine miles) north of its destination — the town of Chachapoyas, about 650 kilometers (390 miles) north of here. 

The plane crashed into the mountain at about 3,000 meters (9,500 feet) above sea level, an area routinely covered with dense morning fog. 

Javier Reategui, transport minister, said a combined team of local rescuers, air force and police personnel was on the scene late Saturday morning, and had found no survivors. 

The minister says the rescuers reported wreckage and body remains scattered over a wide area. 

Initial helicopter rescue efforts had been stopped by torrential rains and the dense jungle underbrush. Local residents told ground rescue crews they heard an explosion in the area, but without the help of the helicopters, those crews could not locate the plane. 

The region is rich in archeological ruins, and has increasingly drawn more tourists. In October, Tans airline began weekly service to Chachapoyas, after years of no air service there. 

 

Woman suspect held
in elderly robberies

By the A.M. Costa Rica staff

A woman and her two adult children have been arrested by Fuerza Pública officials for crimes involving the befriending and subsequent robbery of elderly gentlemen in the canton of Acosta.

The woman with the last names of Barrantes Fernández, 45, was detained after police received multiple complaints against her dating back to October, 2002. Ms. Barrantes was picked up Saturday night shortly after another robbbery of an elderly person in San Ignacio de Acosta.

As she attempted to board a taxi with her son, 25, and daughter, 18, police intercepted the trio. They were found to have two gold necklaces and a sum of money in their clothing.

Police said they suspect that there are many more cases in the vicinity and asked people who might have experienced a robbery by stealth of the type alleged here to come forward.

Police alleged that the woman targeted the homes of the elderly, appeared at the door seeking lodging and offering companionship. Once in the home, they charge she took control, allowed the two children to enter and ransacked the locations.

Persecution on rise,
journalist group says

By the A.M. Costa Rica staff

Persecution of Latin American journalists is on the rise, according to Periodistas Frente a la Corrupción.

In 2001 there were 114 reported cases of attacks on journalists. In 2002 there were 160 such attacks, said the organization which has a name in English of Journalists Against Corruption.

"Unfortunately, the number of attacks against Latin American journalists has risen," said the organization’s report.  "Other than Colombia, where journalists are victimized by the war, most aggressions suffered by journalists are related to their exposing corruption."

In Panama, 90 of its 200 active journalists are or recently have faced defamation suits, almost half of them filed by government officials implicated in corruption."

In July, 2001, Costa Rica witnessed such a case with permanent ramifications. Parmenio Medina, the journalist behind the satirical radio show, ‘La Patada,’ was shot dead near his Heredia home. 

The organization operates out of El Salvador. It lists as its objective the strengthening of democratization in Latin America by supporting ethical and quality journalism intent on scrutinizing and exposing societal corruption.

Rare orchids found
in transport arrest

By the A.M. Costa Rica staff

Police arrested a man they said was transporting rare orchids from the Acosta vicinity to the San José area for sale in the botanical black market.

They identified the man by his last names of Prado Monge, and said that they had confiscated some 75 cuttings of guarias, including some of the guaria morada. Some of these orchids with the Latin name Catteta skinnery are in danger of extinction and protected by Costa Rican law. The cuttings will be replanted in appropriate locations, said police.

Police said they had received confidential tips about the suspect.

Brazilian premier draws
attention to poverty

By the A.M. Costa Rica wire services

BRASILIA, Brazil — The new president here has taken members of his cabinet on a tour of the country's northeastern region to get a first-hand look at some of the nation's worst pockets of poverty.

Thousands of people greeted President Luiz Inacio Lula da Silva and 30 of his top aides at the Irma Dulce shantytown in the city of Teresina Friday. 

The leftist president walked along dirt roads lined with mud huts, shook hands and signed autographs before pledging to provide residents with government programs to end hunger and provide clean water. 

Dubbed the "caravan of hunger," the two-day tour is intended to highlight da Silva's anti-hunger program, "Zero Hunger," which he has made a top priority of his administration. 

An estimated 54 million of the country's 175 million people live below the poverty line. Government officials say they hope to spend about $1.5 billion on the "Zero Hunger" program this year.

Elsewhere, police say 12 people were killed in a gun battle between police and drug traffickers in two shantytowns in Rio de Janeiro. 

A police spokesman says one officer and 11 drug traffickers died in the gunfight, which began early Friday after police entered the shantytowns to arrest four drug traffickers who had received prison sentences.  About 250 police were involved in the raid. 
 
Professional Directory
A.M. Costa Rica's professional directory is where business people who wish to reach the English-speaking community may invite responses. If you are interested in being represented here, please contact the editor.


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Lawyers

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Also, we invite you to join one of the most active discussion groups on the case.  Find out what people who care are saying. Join at irccr-subscribe@yahoogroups.com

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Mortgages





Investigators

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Telephone (506) 280-5217 
FAX (506) 280-5120
P.O. Box 297-2100 Costa Rica
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Our reward offer is still $500

Louis Milanes

Luis Enrique Villalobos Camacho
By the A.M. Costa Rica staff

This newspaper seeks the prompt return of two men who ran high-interest investment operations that have gone out of business.

Luis Enrique Villalobos Camacho, 62, was associated with Ofinter S.A., a money exchange house, and with his own private investment business that had about $1 billion in other people’s money on the books. 

Villalobos closed his business Oct. 14 and vanished.

Louis Milanes operated Savings Unlimited and several casinos in San José. He left the country with other members of his firm the weekend of Nov. 23. He may have as much as $260 million in his possession. Both operations catered to North Americans.

Villalobos had about 6,300 customers. Milanes had about 2,400.

Villalobos and Milanes are the subjects of international arrest warrants.  Associates of both men have been jailed.

A.M. Costa Rica has posted a $500 reward for information leading to the detention of either man with the hopes that others will make similar pledges. The newspaper believes that investors only will see some of their money when the two men are in custody.

Milanes has few supporters in San José. On the other hand, as the letters frequently on this page show, Villalobos still has supporters who believe that he will reappear and settle his debts. They believe he is in hiding because of a predatory Costa Rican government.

Two more letters on the Villalobos case
A Canadian cites 
loss of money

Dear A.M. Costa Rica: 

l don’t know you personaly but l believe that you could understand  just the common sense. 

1)  Since 15 years, l have money with Don Enrike. Since that time, l am coming every years for several months, renting a house, buying cars because they get stolen, food, goods, going to beaches, etc, etc, and my presence here had taped hundred of friends, family l had invited every year who spent money in Costa Rican economy. {It} is easy to understand that if you multiply that amount by 6,000 or 10,000 (Capital flow in Costarican economy was increasing a lot all thoses years. . . . 

2) Costa rica is supposed to be a democratic country…Giving money to your political opponent should not be a crime. Yes he did, but it’s not a reason to percecute him without any proof. Why that country and newspapers have that bad attitude to accuse, put in bars before any trial. What proof do you have against  Enrike’s brother. Not at all. You, A.M, how could you put that ridiculous reward that you still persist to use same as nobody want it…You play the governement game, you don’t help us. 

3) Mr Pacheco, in democracy, you had the right to say that we were fool to believe in Don Enrike same as l consider he was a realy cheap shot for someone in your position. Kind of personal revenge. It’s easy to see, we are not stupid or blind, Mr Pacheco. Then l have the right to don’t accept your insult to my person and be offended. l realy consider to quit the country and never come back when the president spits on me as you            done.  l have spent a lot of money here, l deserve you respect me, do l ever insulted you?

4) All readers and investors, if you are agree with me, please indicate your approval by sending letters to A.M and express yourself. And let’s show to Mr. Pacheco what could we do all of us in goal to resolve that crisis where we are hostage, not only for us but for Ticos who will suffer a lot if we go away. Never underestimate what could do thousands of determined and desperate people. Then, who will rent those tousands of houses, apartements, rooms, the country have built all thoses years, without us or him? 

A Enrike supporter. 
Yvan Beaulieu 
A Canadian in Costa Rica


 

The lawyer has 
an opinion

Dear A.M. Costa Rica: 

I find your posting a "wanted by Interpol" piece of rubbish in poor taste, very bad/yellow journalism and very insulting to Senor Villalobos. 

You don't know him. or Interpol, and you absolutely have no evidence he has done anything wrong. 

I lived there for 3 1/2 years (returning to Richmond in September of 2000), and found him to be a very pleasant, well   mannered and smart businessman who had been in business for 17-20 years when I met him. In the USA, is someone does   something for 25 years, and then someone tries to hammer them for it, those people would be "estopped". This is a legal   doctrine that says, generally. that if you have allowed something to continue for that long, you CANNOT NOW complain about   it as you have given your approval of that business (or whatever) for years and now have no legal standing to complain. 

Not being a CR lawyer, I have no clue as to why this doctrine applies or not. I don't think it really matters as the laws are so   unevenly enforced there that the question is Moot. However, that does not give you the right to publish such scandolous   material about a man who is guilty of NOTHING. It is a government political witchhunt situation, and I would think you would   think yourself better than to sink to the level of the incompetants. The governmenthas no case against him and they know it.   This will be basically a politically brokered deal in which Enrique’s abogados, in my opinion, are holding the best cards. 

E. Baxter Lemmond 
Attorney at Law 
Richmond Virginia 

 
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