Suspect in Investor Scam Charged with Fraud

September 24, 2004

OSVALDO Villalobos, suspected alongwith his brother Luis Enrique Villalobos ofhaving operated a multimillion-dollarinvestment scam, has been officiallycharged with fraud and illegal financialintermediation, Judicial Branch spokeswomanSandra Castro said Monday.Luis Enrique Villalobos remains afugitive from Costa Rican authorities andthe International Police (Interpol).The two ran a high-risk investmentbusiness called “The Brothers” for at least15 years, in which participants deposited aminimum of $10,000 in exchange formonthly interest returns of 2.8-3%.Investigators raided The Brothers’ officeson July 4, 2002, seizing documents, computersand more than $300,000, an eventthat sent a wave of panic among the morethan 6,000 investors involved, some ofwhom had given the business their lifesavings (TT, Nov. 14, 2003).The operation shut down severalmonths after the raid, which followedallegations by officials from the RoyalCanadian Mounted Police that theVillalobos brothers were laundering drugmoney from Canada.Costa Rican prosecutors sent requestsfor information to banks in 169 countries,looking for accounts in the Villalobosbrothers’ names, to no avail. Although noofficial amount has been determined,some speculate as much as $1 billion ofinvestors’ money could have disappearedwhen the business was shut down (TT,July 23).Castro said no date has been establishedfor the start of Osvaldo Villalobos’trial. He is currently behind bars serving apreventive detention order.–Steven J. Barry

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