Banco de Costa Rica has joined with the defense in an effort to keep casino owner Luis Milanes out of jail.
The bank has agreed to serve as trustee for properties that Milanes, former operator of the defunct Savings Unlimited, will give his victims in exchange for them dropping the charges. In Costa Rica criminals can buy their way out of court if the victims agree.
Eliécer Arias Sánchez, manager of BCR Fiduciaria, outlined the proposed trust in a February document distributed mostly to lawyers representing the victims of the failed high-interest scheme.
Savings Unlimited left creditors hanging to the tune of $200 million when Milanes fled Costa Rica in 2002. The fideicomiso or trust would gain control of some properties held by Milanes that are estimated to be worth about $10 million. Among these is the Europa Hotel in downtown San José and an adjacent office building. None of Milanes’ extensive gambling interests or other businesses are included in the deal.
Eventually these properties would be sold and the victims would receive the proceeds after real estate commissions and fees, other costs and lawyers are paid. Banco de Costa Rica would collect a $4,000-a-month fee for handling the trust as well as a half percent annual payment based on the value of the properties held.
José Joaquin Ureña Salazar, a Milanes lawyer, said in a cover letter that the casino owner has suffered three heart attacks and had high blood pressure, and diabetes. “Your ultimate purpose in this case would turn uncertain due to his high propensity to sudden death, being that, the main reason to propose as soon as possible this conciliation on behalf of Mr. Milanes.
There are an estimated 500 investors into the Milanes operation that paid up to 3 percent interest a month. It was one of several high-interest schemes operating at the time. There is no clear understanding how any of the businesses made
enough money to pay that kind of interest, although Milanes was widely believed to be putting the money into his casinos.
Ureña said that in addition to the Milanes properties, money kept by the court, bail money for all the defendants and money recovered from Adolfo Somarribas in Luxembourg would be added to the pot. Milanes claims that Somarribas made off with the bulk of the money. Somarribas is seeking refugee status in Europe to avoid returning to Costa Rica. There has been no accounting as to the amount of money located in Europe.
Some Milanes creditors liken the proposed trustee deal to a similar deal floated a year ago by lawyer Pedro Borges, who placed ads in a local weekly newspaper after Milanes designated him to do so. The difference is that Borges presented a letter that said a company was interested in purchasing the Europa. The authenticity of that letter is now under study.
Oswaldo Villalobos Camacho, convicted of aggravated fraud in a similar although unrelated scheme, got an 18-year prison sentence. After he was convicted, his properties were seized to compensate victims who had pressed their case.
They already have received a percentage but real estate conditions have prevented the sale of some properties.
Considering Milanes health, as reported by his lawyer, and the nature of the crime, if he is convicted he would never again see the outside of a prison. So he has a high incentive to reach agreement with his victims.
Milanes returned to Costa Rica in June 2009, and investors continue to be unhappy that he served just a day in jail before he posted property to make bail.
He had made a deal with then chief prosecutor Francisco Dall’Anesse and promised to pay off his victims.
Those hurt by the Savings Unlimited collapse have a hearing in May where the trust proposal will be aired.