Prosecutors Tuesday morning asked a judge to remand Luis Ángel Milanes Tamayo into preventative detention Tuesday morning.
The casino owner and operator of the collapsed Savings Unlimited high-interest operation was characterized as a flight risk who faces up to 22 years in prison on allegations of aggravated fraud and illegal financial intermediation.
Prosecutors also said that Milanes failed to live up to a conciliation agreement and tried to make deals individually with victims, something that was prohibited. He also was accused of being less than candid when he said he was returning to Costa Rica in June 2008.
Milanes was a fugitive for nearly six years when he was found with a fake passport at an El Salvador airport, the court was reminded. He was believed to have struck a deal with top prosecutors, but that theory was denied Tuesday.
Lead prosecutor Marcela Muñoz asked Judge Dayanna Segura Mena to put Milanes away until he comes up for trial.
The judge deferred her decision until she hears from other lawyers. Ewald Acuña, a private lawyer who represents more than 200 former investors with the Milanes firm, is scheduled to make his presentation today. The judge might not rule on prison until at least Nov. 20.
Milanes and others accused in the case were not present Tuesday. They were represented by lawyers.
The hearing is closed, and reporters are not allowed, according to Costa Rican law. So the information comes from some of the former investors who were at the session, a preliminary hearing where prosecutors and lawyers present their accusations.
Milanes, a Cuban-American, is about 62. A significant prison term would likely be a life sentence. He has been described as ailing with high blood pressure.
Savings Unlimited was one of those firms that sought loans from the public and offered an interest rate of from 3 to 3.5 percent a month. It was a contemporary with the Brothers Villalobos high-interest operations. In fact, Michael González, one of the accused, had been associated with Luis Enrique Villalobos. González was the manager of the Savings Unlimited office in Centro Colón in San José. Enrique Villalobos has been a fugitive since he suspended operations Oct. 14, 2002.
A brother, Oswaldo Villalobos, has been convicted of aggravated fraud.
Whereas Villalobos paid his investors in cash with envelopes stuffed with bills, Milanes was more formal, and his office even had what appeared to be a cashier’s window. Villalobos refused to tell his investors what he did with the money. Milanes claimed he was investing in more casinos.
Milanes cleaned out his office during the weekend before Monday, Nov. 25, 2002. Investors learned
the firm was defunct when an employee sent an email from the company’s account saying that “Michael and Don Luis the owner of this company they run away from the country with your money, try to contact more investments and you will see, sorry.”
That was the last anyone admits hearing of Milanes until he turned up in El Salvador in 2008.
Investors may have lost up to $200 million with the firm. Many investors divided their money between the Milanes firm and that run by Villalobos.
In his efforts to reach an agreement with his investors, Milanes never put the lucrative casinos on the table. Instead he offered real estate and the downtown Hotel Europa where he still lives in the penthouse. Investors said the conciliation agreement began to fall apart a year ago when Milanes failed to make a $578,000 payment that would have been shared among the investors.
The man still lives large in San José surrounded by bodyguards as he travels from the hotel to his casinos. The hotel was one of the properties he offered to investors, but the property attracted no buyers with its $5 million price tag. After a recent reappraisal, the price was lowered, but potential buyers have complained that there is no financial information available on the hotel business.
If the judge decides to send the case to a full trial, that probably would not take place for a year.