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In one of Randy Bergs newsletters a while back he offered “An investment opportunity almost “too good to be true,” near the Tarcoles river which is the most polluted river in Costa Rica where he promises that “the return exceeds 100% in what we estimate will be two years. “
When I read that I was thinking myself that he should be careful promising 100% to investors and today theres this article in la Nacion below. Page 20A. Looks like Randy Berg must have made sombody real angry because he’s unfortunately gotten himself included in a list full of crooked, telemarketing operations.
I am still learning Spanish so do not understand it all but don’t sound good. Anybody trranslate it for me?
http://www.nacion.com/ln_ee/2008/octubre/01/economia1720770.html
Sugeval alerta a inversionistas
23 empresas ofrecen títulos valores sin autorizaciónEntidades atraen clientes ofreciéndoles altas rentabilidades para su dinero
Superintendencia advierte que no ejerce ningún control sobre dichas empresas
Mercedes Agüero R. | maguero@nacion.comLa Superintendencia General de Valores (Sugeval) alertó ayer a los inversionistas que 23 empresas ofrecen productos financieros y servicios de intermediación bursátil al margen de la ley.
Las firmas prometen altas rentabilidades, gestión de cuentas mediante puestos de bolsa en el exterior, operación con una o varias razones sociales y el uso de sitios de Internet, advirtió la Sugeval.
Asimismo, en su sitio en Internet, la Superintendencia publicó la lista de las empresas que operan sin su autorización.
Conforme a la Ley reguladora del mercado de valores, el ofrecimiento de valores en el territorio costarricense, desde el extranjero hacia los costarricenses o desde nuestro país hacia los extranjeros, sin contar con la debida autorización de la Sugeval, es un hecho ilícito que se sanciona con prisión.
La Superintendencia de Valores informó de que durante el año ha recibido 18 denuncias contra este tipo de firmas.
“La Sugeval realiza una investigación previa cuando recibe una consulta o una denuncia de este tipo. Si se encuentran irregularidades lo que procede es poner el caso en manos de las autoridades judiciales”, informó Eddy Rodríguez, intendente de Valores.
Rodríguez no precisó si alguna de la 23 compañías ya han sido remitidas al Ministerio Público.
El funcionario comentó que una señal de alerta de que se trata de “chinamos financieros” es que dichas empresas no están reguladas en ningún país. Normalmente estas compañías hacen ofertas por teléfono, o por correo electrónico.
“Si ya han puesto su dinero en manos de este tipo de empresas, es importante advertir que recuperar lo invertido es casi imposible”, aseguró Rodríguez.
Empresas sin autorizaciónBajo la lupa
Lista de entidades que según la Sugeval no se encuentran inscritas en el Registro Nacional de Valores e Intermediarios. Estas empresas no cuentan con autorización de la Sugeval para hacer oferta pública de valores o servicios de intermediación bursátil:
Armtrust, S. A., Capital Managers Clearing Corporation, Capital Managers Corporation, CR-Home S. A., First Republic Group of Funds, S. A., First Republic Securities Management & Consultant, S. A., Forex Latin Trader, Future Power Industries, Goldmill Wagner Associates (GWA), Hartford Capital Management, Interglobal Finance S. A., Interglobal Mergers and Acquisitions Inc., International Currency Traders S. A., Kennedy Investments Ltda., Kerford Investments S. A., Meridian Trading Group, Rosswell Spencer, Trade Exchange S. A. conocida también como “Tradex”, State Trust Group, Strategic Management, United Holding International, Universal Ventures y Wellington Trading Group.
[Siguiente] [Anterior]Translation……..
SUGEVAL warning to investors:
23 companies are offering securities without permissionEntities attract customers by offering high returns for their money
Superintendent cautions that they exercise no control over these companies
Mercedes R. AgüeroThe Superintendency of Securities (SUGEVAL) warned investors yesterday that 23 companies are offering financial products and brokerage services outside the law.
The firms promise high returns, account management positions through stockbrokers abroad, operation with one or more corporations and the use of Internet sites, warned SUGEVAL.
Also, on its Web site, the Superintendent published the list of companies that operate without their permission.
According to the Law of the stock market, the offering of securities in the Costa Rican territory, from abroad to Costa Ricans or from our country to foreigners without proper authorization SUGEVAL, is a wrongful act that is punishable by imprisonment.
The Securities Commission reported that over the years has received 18 complaints against such firms.
“SUGEVAL conducts a preliminary investigation when it receives a query or a complaint of this type. If irregularities are found it is necessary to put the case in the hands of judicial authorities,” said Eddy Rodriguez, head of Securities.
Rodriguez did not specify whether any of the 23 companies have already been forwarded to the Public Ministry.
The official said that a warning signal that they are “financial fly by nights” (I cant think of the precice word for “chinamo” in English) is that these companies are not regulated in any country. Typically these companies make bids by phone or email.
“If you have already put your money in the hands of such businesses, it is important to note that getting back what was invested is almost impossible,” said Rodriguez.
Companies without authorizationUnder the microscope
List of entities as SUGEVAL are not registered with the National Registry of Securities and Intermediaries. These companies do not have authorization to do SUGEVAL public offering of securities or brokerage services:
Armtrust, S. A., Capital Managers Clearing Corporation, Capital Managers Corporation, CR-Home S. A., First Republic Group of Funds, S. A., First Republic Securities Management & Consultant, S. A., Forex Latin Trader, Future Power Industries, Goldmill Wagner Associates (GWA), Hartford Capital Management, Interglobal Finance S. A., Interglobal Mergers and Acquisitions Inc., International Currency Traders S. A., Kennedy Investments Ltda., Kerford Investments S. A., Meridian Trading Group, Rosswell Spencer, Trade Exchange S. A. also known as “Tradex”, State Trust Group, Strategic Management, United Holding International, Universal Ventures y Wellington Trading Group.
My 2 cents:
I agree with Sally, it takes a lot to get government officials “riled up” here. Considering all the thieves and scammers operating in CR, this is a pretty small list of folks “operating outside the law”. Just imagine!Edited on Oct 01, 2008 14:29
Maybe Scott or someone else knowledgeable can shed some additional light on this. Is it required that anyone soliciting investments in the U.S., or from U.S. citizens, or using the U.S. mails or telephone system also required to file with the U.S. Securities and Exchange Commission?
Having been a professional (Wall Street trained) investment advisor for 20+ years, never in my wildest dreams would I promise 100% to any investor – it’s madness and would certainly raise BIG red flags within the SUGEVAL which is the Costa Rican equivalent of the SEC.
There are good reasons that the financial services industry is extremely regulated. It’s to protect you the consumer from anybody who is willing to say anything to encourage you to “invest” it with them.
I met Randy years ago and even mentioned him in my real estate book and he is a very intelligent man so perhaps someone else is responsible for this sort of reckless marketing, not him, I don’t know.
As an investment advisor myself, I have never accepted monies on behalf of my investment clients (and the SUGEVAL knows that) and they are not concerned with that kind investment advisor (as long as he’s not advertising or making a “public offering”) but, if someone is accepting “investments” from people – whether they are in the US or in Costa Rica – then he is opening himself up to what could be serious criminal charges both in Costa Rica and maybe also within the USA.
The SUGEVAL worries about “public offerings” and if your information is on the internet and you’re asking people for money for an “investment” of any kind it’s a “public offering.” It’s very risky and even if there is no criminal intent here, fighting those kinds of allegations or charges with Costa Rican authorities could take 10+ years which is not the way I would like to spend my retirement.
Lastly, as a retired person here, if Randy is found working here as a retired person, he could also face some complications with immigration on that too…
Scott Oliver – Founder
WeLoveCostaRica.comRandy Berg
Has been joked about on this Bulletin Board before and I never have found any truth to any of it. Scott has a nice piece of property advertised that I would love to buy. Is there any law against a group of people getting together and buying property as a group.
Randy puts up some very interesting properties. A house close to the beachfront for $31K, $22K? Most developers get more than this for building your home here. Some con men have asked this for a downpayment that was lost. The point being is that Randy has advertised some very interesting properties. I have always found Randy to be honest and sincere traits that are lacking in Costa Rica. Plus I don’t see that he was charged with anything!
Stan Putra
President
BBEThe company owned by Randy Berg is named as one that has, and continues to, run illegal investment funds in Costa Rica. There is no point in guessing if he is a good person or an honest person because it is all speculation.
The truth is that Sugeval has listed his company as one operating, according to the LAWS of COSTA RICA, in a criminal way.
The crime is punishable by fine, prison or deportation.
Will he be charged? who knows but in a country that is VERY serious regarding slander……I expect that SUGEVAL would not publish this on their website without being sure.
Anyone looking for investments should bear THIS fact in mind.Here is the link
http://www.sugeval.fi.cr/esp/serinv/serNo_inscritos.htmlEdited on Oct 06, 2008 14:32
And speaking of speculation, Truth2008, one wonders what the significance is of the fact that the Bergs’ recently completed home is suddenly on the market at a price that’s some $100,000US below its value (according to Randy). According to Randy’s own statement in his forum, the owner is anxious to sell.
Hi Scott,
OK – let me see if I undestand. You cannot ask for investors over the internet/publically. I thought the problem with the US end of things (SEC) was offering to sell stock in a corporation that was not regiestered with the SEC?
On the CR end of thing, the goverment says you cannot advertise for investors – period???
Sounds like there are some missing details here. Can you please clarify.
I am NOT an attorney and do not give legal advice on anything however, according to [ http://www.sugeval.fi.cr/esp/serinv/serNo_inscritos-eng.html ]
“The Superintendency of Securities of Costa Rica (SUGEVAL) has received reports about companies that supposedly operate in or from Costa Rica. Nevertheless, they are not listed in the National Registry of Securities and Intermediaries. Therefore, they are not authorized by SUGEVAL to make public offering of securities or other related services.
Consequently, SUGEVAL doesn’t exert neither supervision nor control over these companies, and has no information available on them.”
And in BIG RED LETTERS it states:
“Warning: All offerings made in or from Costa Rica to foreign or local investors without proper authorization from this Superintendence, are considered a direct violation of the Law of Securities Markets N. 7732 and Commerce Code and could be penalized by prison.“
Historically they have looked upon intermediaries (advisors who may give advice but do NOT accept money) in a slightly different light but, people/companies that are actively soliciting investments of any kind and who are accepting monies for investment are what they are more concerned about.
I have not seen Randy for a very long time but I doubt that Randy Berg would knowingly be involved with anything nefarious but for some reason the SUGEVAL has placed his company’s name on a list that includes some rather unsavoury businesses.
Scott Oliver – Founder
WeLoveCstaRica.comThe truth is that Randy Berg solicits for and collects money to use as seed capitol for his developments, or to use to purchase land that he re-sells through his company CR-Home.
I know this to be the truth because I am invested with him.An ex cr-home client posts this on Randy Berg’s CR-Home forum and it is repeatedly removed.
I think it is a valuable bit of information
My wife and I, like many of you, found CR-Home through the internet while looking for “our piece of heaven” in Costa Rica. We were in contact with Randy via email for the following two years and followed their website looking for the perfect property and follow what was going on in Costa Rica.
We were very fond of their “two story cabina” and the published price of 35-40K seemed to be in our budget.
After making our final decision to make the dream happen and move to Costa Rica, we contacted Randy and set up a few days to visit properties we had seen on the internet and some that were not published. We were invited to stay at their cabina while we were going to be in the Grecia area, and so we did.
We traveled with Cr-Home employees for three days and after some debate, made a decision on what we thought would be “our perfect fit”. We went back to the office to discuss details and future plans.
We were shown the plans of the property and were told at this time that the property had all utilities on it and it was a buildable lot because it had a “visado” stamp among others official looking stamps.
After over two years of talking with Cr-Home we felt comfortable believing what they were saying and trusting that they had done all the checking in to the property that was needed to buy it and build on it. This is what we were told at the time by Randy. After this meeting with Randy, and confirmation that everything was final with the land purchase we began to design our future home with the help of Rhonda and their architect, Gerald.
We were sent ideas that we liked and my wife and I altered the plans to match our liking better. We were using their “cabina” template to work with and felt that if we did so, the price would be close to what they advertised on their website.
A few months passed and we had become official landowners in Costa rica with blueprints to build. The architect for Cr-Home had our plans and finished them in 6 weeks, we were ready to build…or so we thought.
I then planned a five week trip to Costa Rica to oversee the land development and to begin the construction process on the home design we had chosen. First thing that was set up to be done on the land was back hoe grading work, excavation and road gravel delivered and installed where the future driveway would go. Everything was moving forward SLOWLY but surely. It is Costa Rica and this is the way things move, slow.
THEN, the bottom dropped out! It was on the third week of my time here when I was approached by a Grecia Municipality worker who had seen us doing work on the land. He advised me that we needed to check for an “uso de suelo” on the land because he felt like it was very close to a “tapped water well”.
I then called Randy at CR-Home and told him this news and he once again assured me that with the “visado” we could build there. He also stated once again, “I have done everything prior to you purchasing the lot to ensure you could build on it.”
A request was made for a map from the CR-Home topographer to show these “water springs”. Four days passed and we were told and shown a detailed map of our Carbonal property and it was confirmed that there were indeed two active springs that were capped and supplying water to Grecia right next door to our property.
I emailed Randy while he was on vacation in the states, and told him of my frustrations and my feeling that we had been let down, misrepresented and lied too. He replied and once again told me that, “he had done everything in his power to ensure we could build and that there are a lot of grey areas in Costa Rica now with the regulations on construction changing over the last few months.”
Have any of you ever read anything on his site or in their newsletters that addresses’ “new regulations and these changes that cause grey areas in construction in Costa Rica.” In fact, when I talked to the Cr-Home attorney, he said that there were no “grey areas” as long as the proper steps are taken, and there had been no recent changed to the regulations.
I was then advised by one homebuilder and a CR-Home sales rep to go to the municipality of Grecia and request the official “uso de suelo” on the property. I did so and was told it would take 8-15 days to hear the outcome.
Have any of you heard the term “Uso De Suelo” or of an organization by the name of the MINAE? After living here now in Grecia and meeting people, hearing similar sounding horror stories, knowing how things here work, I know that many of you that have purchased land and don’t have an Uso De Suelo and have never heard of the Minae.
So let me do the honors and tell you about the MINAE and the “use de suelo.” The MINAE is an environmental group that does all it can to regulate and control deforestation, protection of the land, locate sensitive environment zones, protect water ways, locate water springs, create water caps on springs so that Costa Rica can have great drinking water, and the list goes on. The MINAE has been around for a long time, you can GOOGLE search MINAE and get more info.
The municipality and the MINAE issue the Uso De Suelo, which means the “use of the soil”. This letter from the Municipality is your ticket to know what you can do on your own land. Without this letter the “perfect property” you own might just be farmland and never be able to be built on.
Recently we were told that the MINAE was finding up to 10 “water springs” a day on Cajon De Grecia. These water springs stop all construction within 100 meters if it is not being used, or “capped” and no construction allowed within 200 meters if it is being used for supply to the municipality.
If I only knew then what I know now, we would not be in this situation. Also, about the “visado” stamp, we were told by Randy this was all you needed to build, this is not the case at all. It is just one of many stamps needed prior to getting the green light to build. Oh and the stamps all expire after THREE years, not NEVER, like we were told.
As for the “35-40K cabinas they advertise, I showed the plans to three of their own builders and the bids were not even close to what they advertise. The first bid was over 90K, second one was 65K and the final one was from a guy that would build it but take a lot longer.
We never actually got a final bid from the last guy because he would build and get paid weekly until the home is done. Kind of shady HUH?? What you will learn if you plan on building here is that all the good builders you would actually trust your future investment to, will only bid on “contract” like they do traditionally in the states.
If you do choose to build without a contract and pay week to week, good luck! I personally want some warranty on the labor and materials of my investment as there is little in terms of home insurance here.
So here we are now 8 months after we closed on the purchase of our land in Carbonal. We have hired an attorney to represent us and our interests in this nightmare.
We in fact should be moving in to our dream home in Cost Rica this month but instead are still dealing with this mess and still living in a rental home.
One way or another CR-home has an attorney that has supposedly gotten this resolved yet we still don’t have the new “uso del suelo”. This is a direct quote from an email Randy sent to me after his attorney “took care” of this part of the situation. “Thanks to Luis and the connections he has in the municipality, it has been handled.
It is unfortunate that things have turned out to be as frustrating as they did. But you are in Costa Rica and much of the time the areas are gray instead of black and white.” There again is this “black and white” term he uses with me but never cares to bring up in his newsletters.
Just when you think things couldn’t get worse, they did. This past month we found out that the property “that had all utilities and services” already in place does not.
I had a meeting with the water director for Carbonal and he advised me that our property has no water at the road but it is in the works to be put in with in the next year.
By this point you probably think this is a joke but it really isn’t. The water director said they have been working on getting the money to supply municipal water to this part of the hill for over 5 years but no funding has been available.
Turns out that our neighbors have been there for a long time and have wells for water for their homes. The water director did give us the option to try and “experiment” and bring our own pipe and connections to try to run a line from a lower holding tank some 150 meters away up the hill to our property. He really did not have to allow this “experiment” but after he heard our story he felt bad enough to allow this to be done.
This whole time I am of course remembering just how many times I have read the words due diligence, transparency and integrity in Randy’s news letters and articles.
This is our experience that we are dealing with now. Please let me know your comments and thoughts if you have them. Good or bad, I want to know what you all think.
If you have questions or need additional information that I might know after having to go through this nightmare please email me. Thanks for your attention and opinions.
The foregoing anecdote points out how critically important it is to get good and unbiased advice and research before proceeding to buy property or build here in Costa Rica.
The writer has learned the hard way not to take the assurances of anybody (anybody) whom they themselves have not retained to represent and protect their interests. No one should rely on the assurances of a real estate agent, the real estate agent’s own attorney, the family of the real estate agent, the architect of the real estate agent or anyone else even remotely connected to either the real estate agent or the seller of the property.
Traditionally, in the United States, real estate agents (Realtors and non-Realtors) have represented sellers, and buyers have been left on their own. In recent years, the phenomenon of “buyer agency” in which a real estate agent represents the interests of the buyer has emerged. And it’s a good thing. And it’s about time.
No such situation exists here in Costa Rica. Real estate agents are unlicensed and their behavior is totally unregulated. They can misrepresent anything they can get away with, and it’s common that they do so. They can mark up the price of property and keep the difference, along with their commission, and it’s not unusual. They can make any assurances with regard to utilities (availability and cost), road improvements, use of the land itself, etc with no risk of reprisal.
In Costa Rica, real estate agents are free not to represent the seller’s interests, not to represent the buyer’s interest, but only to represent their own selfish interests. And it ain’t unusual. Failure to recognize this critical fact commonly leads to the kinds of experiences reflected in this buyer’s unfortunate experience.
I took a look at the http://www.cr-home.com website the other day and was unable to find the forum. A friend said it had been shut down. One wonders why.
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