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These stories appeared Tuesday, April 8, 2003, in Vol. 3, No. 69
Jo Stuart
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Banco Nacional named in court filing
Stock scam cash was hidden here, U.S. says
By the A.M. Costa Rica staff

An Illinois stock scammer dumped his ill-gained money into Costa Rica’s Banco Nacional for safekeeping, the U.S. Securities & Exchange Commission alleged in a court filing.

The man is Frank J. Custable Jr. of Glendale Heights, Illinois. His Costa Rican operation is called Pine Service, Ltd., said the U.S. government.

The commission, the U.S. stock market police, outlined an elaborate and brazen scheme it said that Custable orchestrated since at least 2001. The activities included using the Internet to tout millions of shares of stock that reached the public market fraudulently, the government said.

The civil suit asks a federal judge to order Custable to halt his activities and surrender any money he may have made in a fraudulent manner. Civil action frequently precedes criminal action in stock fraud cases.

Custable got millions (and in one case billions) of shares of stock from at least seven small publicly-traded companies to sell to the public through a series of so-called strawmen, the commission said. In one case, the commission alleges he simply counterfeited and sold stock certificates amounting to half the value of one small company, said the commission.

There is no evidence in the filing that Custable ever was in Costa Rica, but the commission said that he controls Pine Service here. When Custable got large blocks of stock, he would transfer them to Pine Services which would then transfer the shares to a brokerage account for sale, the filing said. Pine Services then would transfer the proceeds of the sale to a Banco Nacional account, said the commission court filing. The latest such transaction took place Feb. 14, the commission said.

Since June 2002, Custable transferred more than $110,000 to Pine Service, which is based in San José, according to the commission. The filing said that the commission did not know what other business activities the Costa Rican entity carried on.

The bulk of Custable's fraudulent activities involves the sale of so-called restricted shares he and his associates obtained for alleged consulting services from small companies that needed financing. Such shares are not supposed to be sold to the investing public, but the commission alleges that Custable did just that. The commission also claims he used friends and associates and their brokerage accounts in order to keep as low a profile as possible.

Pine Service Ltda. is listed in the Costa Rican Registro Nacional as an active corporation but does not seem to own any real estate or any other assets here.

Child labor campaign will get boost from stars
By the A.M. Costa Rica staff

Costa Rica is stepping up its campaign against bad forms of child labor.

To do that, officials are enlisting the aid of political, cultural and sports figures, plus U.S. astronaut Franklin Chang Diaz. They will attend a kickoff campaign April 25 to sign a manifesto against child labor.

Promoters include the International labour Organization, the Ministerio de Trabajo, the Ministerio de Cultural, Deporte y Juventud and the Municipalidad de San José.

Officials noted Monday that more than 100,000 underaged children in Costa Rica work when they should be going to school. Enrique Brú of the International Labour Organization said plainly that the principal cause of such labor is poverty, but other officials noted that some parents put children to work simply because they want the money the youngsters earn.

The campaign is part of a worldwide effort by the labor organization which is linked to an international treaty against child labor. Most countries, including Costa Rica, have accepted the treaty.

Two former presidents, Oscar Arias Sánchez and Rodrigo Carazo Odio also will sign the document, according to organizers. 

A.M. Costa Rica/Saray Ramírez Vindas
This poster incorporates the campaign

Youngsters in rural areas frequently do farm work, including the harvesting of coffee. In the cities, children can be seen selling items at times when they should be in school. The legal age for work in Costa Rica is 16 years.

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Multiple rapist may be here surfing in Costa Rica
By the A.M. Costa Rica staff

A man convicted of 86 criminal counts of rape and other related charges fled the United States in January and may be in Costa Rica.

Andrew Luster, 39, is wanted by the FBI for failing 
to return to court in Ventura County, Calif. where he was being tried on multiple rape charges including rape by use of drugs and rape of an unconscious person. Luster used the date-rape drug gamma hydroxybutyrate, an odorless and tasteless fluid, that can cause blackouts, to immobilize his victims, according to 
Andrew Luster
the FBI Web site. Investigators discovered in Luster’s apartment a Costa Rica traveler guidebook and notes referring to Costa Rica, according to a Los Angeles Times report Sunday.

Noticeably missing from Luster’s remaining 

wardrobe were warm- weather clothes, according to the newspaper.

Luster is an "avid surfer," the FBI has noted.

Luster was arrested in July 2000 and released on bail during his trial on the condition he wear an electronic monitoring device, according to the Ventura County Sheriff’s Department.

The company in charge of electronically monitoring Luster noted that he did not return to his home Jan. 3, according to the sheriff’s department. Since then California has considered him a fugitive and a federal arrest warrant was issued.

Luster was convicted of rape and other related charges after he fled.

Luster is 6-feet tall and weighs between 215 and 220 pounds. He is a white male with brown hair and green eyes. Persons who see Andrew Luster should notify their U.S. Embassy if he is spotted overseas, the FBI said.

The convicted rapist may be carrying a firearm, according to the FBI. 

Costa Rica's economy worries top U.S. rating firm
By the A.M. Costa Rica staff

A major U.S. credit rating firm has downgraded its financial opinion of Costa Rica. The firm, Standard & Poor's, said Friday that it was revising the outlook on Costa Rica’s long-term credit rating from stable to negative.

The firm said that Costa Rica has heightened vulnerabilities due to several factors.

The negative rating could cause the country to pay higher interest for governmental bond issues and also discourage some investment.

Among the vulnerabilities cited by the firm were what was called "fiscal slippage." The country’s budget deficit rose to nearly 5.2 percent of gross domestic product in 2002 and may only decline to 3.6 percent under temporary measures, it said. 

The evaluation of the country’s prospects was made by Richard Francis, an analyst with the rating firm. The country retains the rating of BB+ on long-term local financial issues and BB on long-term foreign currency credit ratings, the company said.

"The higher general government fiscal deficits have  increased policymakers' reliance upon monetary policy as the primary  method for maintaining macroeconomic stability. The resultant rise in interest rates has led to the higher cost of 

servicing a growing general government debt and has encouraged domestic agents, most worryingly those without hard currency earnings, to take long-term dollar loans," he noted.

If Costa Rica under stress has to change the way it manages its monetary policy, it faces the risk of banking failures and higher liabilities for the government, Francis said. 

The basic way the government manages foreign exchange is by devaluating the colon slightly each business day. Since Jan. 1 the colon has declined from 378.39 to  388.92. That represents a 2.6 percent depreciation in the first three months of the year or an estimated 10.4 percent inflation rate against the U.S. dollar for a year.

Standard & Poor's said that failure to implement tax reform in order to lower the fiscal deficit (in addition to steps aimed at strengthening the country's monetary and financial regulatory framework) could lead to downward pressure on the government's credit rating. 

Fiscal reform would  help lower interest rates while discouraging further dollarization.  Although there is general political consensus on the need for fiscal adjustment, a fractured Congress has complicated the negotiations for a  reform package; at the same time, rigid government finances give little flexibility to cut expenditure, the rating expert said.

U.S., others upset
by Cuban sentences

By the A.M. Costa Rica staff

The United States and international human rights groups have condemned the Cuban government for the sentencing of several leading dissidents and journalists to lengthy prison sentences for treason and subversion. 

State Department spokesman Philip Reeker told reporters Monday the government of President Fidel Castro is persecuting journalists for acting like journalists, economists for acting like economists, and peaceful activists for seeking a solution to Cuba's growing political and economic crisis. 

Among those sentenced was democratic campaign reformer Hector Palacios, who received a 25-year prison term. Dissident journalist Raul Rivero and economist Marta Beatriz Roque each received 20-year sentences. 

Authorities originally sought a life sentence for Palacios, a key supporter of the Varela Project, a petition drive that seeks democratic reforms on the Communist-run island. 

The New York-based group Human Rights Watch, the Committee to Protect Journalists and the Roman Catholic Church all joined Washington in condemning the trials and convictions. 

Cuba began rounding up dozens of dissidents in March on allegations of conspiring against the Castro government. The Cuban leadership accused the dissidents of being on Washington's payroll and collaborating with U.S. diplomats to harm the island and its economy. 

The crackdowns occurred after the top U.S. diplomat in Cuba, James Cason, met with pro-democracy groups. 

European and Latin American Governments have also condemned the crack down

Environmental pact
signed by U.S., México

By the A.M. Costa Rica wire services

TIJUANA, México — The United States and Mexico have signed a 10-year plan to protect the environment along their 3,200 km. (1,984-mile) common border. 

The new program called "Border 2012" is aimed at decreasing air, water and soil pollution levels by lowering the use of pesticides and other chemicals. 

Linda Fisher, U.S. Environmental Protection Agency deputy administrator and her Mexican counterpart, Undersecretary Raul Arriaga, signed the agreement Friday here.

The United States and Mexico signed the La Paz agreement in 1993 to protect and improved the environment along the border. 

Dig, they must,
along U.S. border

By the A.M. Costa Rica wire services

U.S. officials say they have found a tunnel under the U.S.-Mexico border that they believe may have been used to smuggle drugs into the United States. 

An opening to the tunnel was found in a parking lot near the San Ysidro Port of Entry, the busiest U.S. border crossing point. Authorities say the tunnel was lined with insulation and wired for electrical power. 

Police had found a truck loaded with more than 1,300 kilos (2,860 pounds) of marijuana near the tunnel in the parking lot Friday. The truck had a hole in its bottom through which the drugs could be loaded unnoticed. 

Mexican and U.S. officials reportedly have discovered nearly 20 drug tunnels along the U.S.-Mexico border over the past decade. Almost half that number were found since December 2001. 

Excitement at hotel

By the A.M. Costa Rica staff

A small kitchen fire caused excitement at Hotel Bougainvillea in Santo Domingo de Heredia about 5 p.m. Monday. There was no serious damage.

Forest fire gear donated

By the A.M. Costa Rica staff

The U.S. government has donated fire-fighting equipment worth about $50,000 to help set up a center against forest fires in Guanacaste. That’s where wind-driven blazes ravaged hundreds of acres late last month.

Professional Directory
A.M. Costa Rica's professional directory is where business people who wish to reach the English-speaking community may invite responses. If you are interested in being represented here, please contact the editor.



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Also, we invite you to join one of the most active discussion groups on the case.  Find out what people who care are saying. Join at irccr-subscribe@yahoogroups.com


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Washington Post wins Pulitzer for Mexican report
By the A.M. Costa Rica wire services

NEW YORK, N.Y. — The Washington Post won the prestigious Pulitzer Prize for international reporting for a series investigating Mexico's criminal justice system. The Pulitzer Prize Committee said Kevin Sullivan and Mary Jordan "exposed horrific conditions" in Mexico's criminal justice system, and detailed how those conditions affect citizens' daily lives. 

Pulitzer Prize Administrator Sig Gissler says the risk-taking involved in the reporters' work exemplifies the kind of dedication that produces award-winning coverage. "It was clear from the stories and the nomination letters that they had to undertake some very risky reporting at times," said Gissler. "Going into some remote areas. Areas where they could be physically at risk. This was courageous reporting as well as extensive reporting." 

Another story focusing on Latin America won the feature writing award. In "Enrique's Journey," Los Angeles Times reporter Sonia Nazario documented a Honduran boy's search for his mother who had migrated to the United States. 

The Los Angeles Times also won the national reporting award for Alan Miller's and Kevin Sack's examination of a military aircraft, nicknamed "The Widow Maker," that was linked to the deaths of 45 pilots. 

Gissler says stories like these prove that the news media is still "doing its job." "It's important to remember, when the news media is being so often 

criticized, that several of these [winners] were very important investigations into corruption or malfeasance, and you really saw the watchdog function of the news media in action," he says. 

The award for explanatory reporting went to the staff of the New York-based Wall Street Journal for its in-depth coverage of the corporate scandals that have rocked the United States over the past year. The Boston Globe won the public service award for covering the sexual abuse scandal that has shaken the U.S. Roman Catholic Church. 

The Pulitzer Prize for investigative reporting went to Clifford J. Levy of The New York Times for his "Broken Homes" series, exposing the abuse of mentally ill adults in state-regulated homes. 

Gissler said Levy's win is exceptional. "Quite often, in recent years, investigative awards have gone to teams of reporters," he says. "And I think the board was particularly pleased to give the award to a good old fashioned, solo reporter who just kept digging and digging." 

The Pulitzer Prize, administered by the Columbia University School of Journalism, also gives awards in the arts. Author Robert A. Caro won for the second volume of his comprehensive biography of President Lyndon B. Johnson, called "Master of the Senate". The general nonfiction award went to " 'A Problem From Hell:' America and the Age of Genocide" by Samantha Power. 

Avant-garde composer John Adams received the music award for his composition, "On the Transmigration of Souls." 

Our reward offer is still $500

Louis Milanes

Luis Enrique Villalobos Camacho
By the A.M. Costa Rica staff

This newspaper seeks the prompt return of two men who ran high-interest investment operations that have gone out of business.

Luis Enrique Villalobos Camacho, 62, was associated with Ofinter S.A., a money exchange house, and with his own private investment business that had about $1 billion in other people’s money on the books.

Villalobos closed his business Oct. 14 and vanished.

Louis Milanes operated Savings Unlimited and several casinos in San José. He left the country with other members of his firm the weekend of Nov. 23. He may have as much as $260 million in his possession. Both operations catered to North Americans.

Villalobos had about 6,300 customers. Milanes had about 2,400.

Villalobos and Milanes are the subjects of international arrest warrants.  Associates of both men have been jailed.

A.M. Costa Rica has posted a $500 reward for information leading to the detention of either man with the hopes that others will make similar pledges. The newspaper believes that investors only will see some of their money when the two men are in custody.

Milanes has few supporters in San José. On the other hand, as the letters frequently on this page show, Villalobos still has supporters who believe that he will reappear and settle his debts. They believe he is in hiding because of a predatory Costa Rican government.

An invitation to enter our photo contest
The first A.M. Costa Rica photo contest welcomes your submissions and will award a prize of $100 in each of five categories.

The deadline for submission is April 15. The contest was announced in November.

Five categories have been established:

1. DEADLINE NEWS: A news photo that shows a breaking news event, such as, but not only, crime, accidents, fires, arrests.

2. SCENIC: Landscape scenes which may or may not include people as a secondary emphasis.

3. WILDLIFE: Photos that have as their principal subject one or more animals, plants or insects.

4. SPORTS: A photo related to one of the major or minor sports, team or individual.

5. PEOPLE:  A photo that has as its principal emphasis one or more persons, including individual portraits. 

Deadline is April 15

BASIC RULES: The photo must be taken by the person who submits it, and he or she, as a condition of submission, agrees to give A.M. Costa Rica the right to publish the photo in A.M. Costa Rica. Upon publication, the photo will be covered by A.M. Costa Rica’s copyright, which the newspaper will happily assign back to the contestant upon request. As a condition of submission, the contestant affirms that he or she owns full rights to the photo and that it has never before been published in any professional medium.

The photo must have been taken within the borders or territorial waters of Costa Rica between Nov. 15 and the contest deadline. 

Only one entry per photographer is allowed in each category. Judges reserve the right to place the photo in another category during the selection process.
Employees, shareholders or interns with A.M. Costa Rica may not enter the contest. 

This is an open competition. No distinction will be made between professional and amateur photographers.

A.M. Costa Rica, at its option, will publish photos and information including the name of the photographer, as submissions are made.

The management of A.M. Costa Rica and judges are the final authority on contest rules and submissions.

TECHNICALITIES: The photos must be sent digitally via e-mail to 

editor@amcostarica.com, and the subject line must specify "photo contest." Within the body of the e-mail, the contestant must specify into which category the photo is submitted. The photo should be between 4 and 8 inches in width and contain no less than 72 pixels per inch of density. Each photo should not be larger than 200 k.

The e-mail message must clearly state the name and the circumstances surrounding the taking of the photo and the date the photo was taken. 

The photo should be in jpeg format and sent as an attachment with the file name as the number of the category in which it is being submitted followed by the name of the photographer.

For example, the file name of a photo in the sports category taken by Mr. Jones would be 4jones.jpeg or 4jones.jpg

PRIZES:  A first place winner will be named in each category, and the prize will be $100 paid via Pay Pal, the electronic fund-transfer system.

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