Spanish Real estate fraud on the Costa del Sol

This type of fraud is currently flourishing. The National Police Fraud Squad has recently detected new scams concerning the sale of estates to foreigners, whose perpetrators are more often than not their own compatriots. In fact at present half a dozen separate investigations are open as a result of around 30 complaints and reports received in July and August, confirmed police sources to SUR.

The majority of the victims of this type of fraud are British, although reports have also been received from people from Germany, Switzerland, Belgium and Scandinavian countries. Now the con men are changing their modus operandi: “They don’t just find their prey on the internet. We have cases where the victims are expatriates, foreigners who already live in Spain or who visit every summer”, explain the police.

In a typical case, a chosen estate is divided into plots of 800 to 1,000 square metres which are put up for sale for between 18,000 and 30,000 euros. The cases detected by the police are concentrated in the Guadalhorce Valley area and at times in the Axarquía. The attraction of both areas is the combination of peaceful countryside while still close to the beach.

“Rustic” land

In some cases the con man is really the owner of the land as he claims and sells it off in plots, knowing full well that the law prohibits construction in that area. “They tell the buyers that they can build a wooden prefabricated home but the land is classified as ‘rustic’”, say the police. “Furthermore, if he is the owner of the land, he has no problem showing it to potential buyers”. Sometimes the seller only possesses an option to purchase which is never carried through. Or sometimes they don’t even have that; they simply sell what isn’t theirs through advertisements in the press and on the internet.

They operate under the cover of small firms which appear above board until they disappear into thin air when it comes to signing a contract which never reaches the hands of a public notary. So far the police have arrested six people on the basis of previous reports, and some of these have a history of fraud related to time-share. “Other types of fraud are running dry and they have moved on to new territory”, adds an officer.

Investigations have revealed that some cases could be connected. The police are investigating if, as in the case of the time-share scams, behind all this are hierarchical organisations, between which money changes hands for lists of potential clients.

Town Hall warnings

For the time being some local town halls have tried to save some potential victims by putting up signs in several languages by the roadside advising people to consult the local authority before buying anything, as well as opening offices for foreigners thinking of settling in the area. Concern among the authorities is clear. The Foreigners Department at Nerja Town Hall issued a notice just last week urging people to seek information at the department before buying a property or paying any type of deposit. Here information will be provided regarding the procedures that should be taken and verifications that should be made before any money changes hands to avoid bad experiences. “Many people come to see us just after buying the property when their problems start. Please come before”, stresses the department.

Nevertheless the police continue to receive new reports from distraught people who have handed over money for their ideal piece of land, which has turned out to be no more than a pipe dream.

Businessman faces five years for conning British couple over land sale

The couple paid 61,000 euros for land in Almogía on which they could not build

Montse Martín

A real estate businessman faces a five year jail sentence for fraudulent practice in the sale of a plot of land in Almogía to a British couple. Vicente S. M., the owner of a real estate firm specialising in rural properties, is accused of selling the couple a plot on which they were unable to build.

The accused, “driven by a desire for unlawful gain and claiming a level of solvency he lacked” - according to the public prosecutor - placed advertisements in the English language media reverting people to the websites run by his own firm and that of his wife, which offered real estate services, specialising in rural properties, old country houses, new villas and building plots in different areas of the Costa del Sol. Furthermore, Vicente S.M. offered the option of complementary construction contracts and legal advice.

According to the prosecution, this apparent solvency and legality led the British couple to contact the accused from the UK. He offered them a plot covering almost 2,000 square metres of which 140 could be built on, and they decided to buy. In December 2001 the British couple acquired their plot by means of a private contract, handing over 48,000 euros. Furthermore on the same day they signed another private contract for construction and improvements to the value of 30,000 euros, of which they paid 12,000.

However the contract could not be fulfilled as the land in question is located in an area not designated for construction, known as “no urbanizable” in the local General Town Plan (PGOU).

The prosecution maintains that the accused knew that the land could not be used to build a house before he signed the contract with the British couple, who in the end handed over 61,000 euros “which Vicente S.M. used to his own illicit gain”.

Family fined 17,000 euros for illegal house

Rachel Haynes

The story of Robert Haywood and his family is just one example of the nightmare situation some foreigners find themselves in simply because they trusted an unscrupulous builder, landowner, lawyer, etc.

Robert and his wife Sharon bought a plot of land from a builder in Torrox who also agreed to build their house for them. He had been recommended by friends who had bought land from the same man. It was only after their 80 square metre house was finished that they realised that the land was classed as “no urbanizable” and they had only been granted planning permission for a 24 square metre shed.

Robert explains that the builder in question demanded payment in full upfront before he started the construction work. The couple were advised by a lawyer, recommended by the builder, that this was “normal practice in Spain”. Receipts were signed and the house was built, all before planning permission had come through, another “formality” which, Robert continues, did not seem to concern the builder. Despite their demands to see the title deeds for the land, these have never been forthcoming.

Since then Robert and Sharon, who is heavily pregnant, and their two sons, Ben and Kieran, have been suffering harrassment from the builder who has offered to buy back the land for much less than they originally paid. This harrassment even led to a court case which was dismissed after just five minutes. It was then, Robert continues, that they discovered that their new lawyer was also a friend of their builder’s.

Now Robert has been issued with a fine of 17,000 euros for illegal construction, which he cannot afford . All in all a complicated situation which the Haywoods hope can be sorted out by a good lawyer.