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(506) 2223-1327          Published Wednesday, May 11, 2011, in Vol. 11, No. 92             E-mail us
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Calderón declared guilty but will not do time
By the A.M. Costa Rica staff
Posted at 2:10 p.m. Wednesday

The Sala III high criminal court upheld, much of the case against former president Rafael Ángel Calderón Fournier and his associates in a decision released Wednesday. But the court downgraded the allegations to one count of simple embezzlement and overturned the penalty of prison.

The court reduced the sentence given Calderón by the trial court from five years to three and awarded him conditional execution of the penalty. In other words, if he is not involved in another criminal case in five years he will not go to prison on the embezzlement charge.

The same decision affected co-defendants Eliseo Vargas García, Juan Carlos Sánchez Arguedas, Gerardo Bolaños Alpízar, Walter Reiche Fischel and Marvin Barrantes Vargas, according to a summary of the decision released after lunchtime.

Defense lawyers presented a number of appeals from the Tribunal Penal de Hacienda Oct. 5, 2009. The appeals that were upheld related to money damages but not to the guilt or innocence of the defendants, according to the summary.
The initial decision also ordered the confiscation to the state of more than $500,000 that Calderón had in Banco de Costa Rica and the money in another account in the United States. Vargas, too, was ordered to surrender money in his accounts. This aspect of the verdict seems to have been overturned.

The Sala III magistrates agreed with defense appeals and threw out evidence based on financial statements from Panamá based on the way the information was collected. But the court accepted similar proofs from Miami, Florida.

Calderón was convicted of accepting a bribe to advance a $39.5 million contract for equipment being supplied by a firm from Finland. Vargas is a former deputy and former head of the Caja Costarricense de Seguro Social, and Reiche Fischel  was the head of a local pharmaceutical company that handled the transaction. Reiche Fischel was the principal witness against Calderón and also a defendant.

The magistrates also ordered that a home in the  Parque Valle del Sol subdivision in Santa Ana, once occupied by Vargas, be registered in the name of the state.

Poker travails may have silver lining for expats
By the A.M. Costa Rica staff

The situations involving online poker operations in Costa Rica continue to be confusing, but expats seem to be benefiting.

The exchange rate between the U.S. dollar and the colon took a small jump, and several hundred bilingual potential employees are now in the job market.

The dollar exchange rate has been depressed by the flood of money coming into the country. A.M. Costa Rica has reported on large-scale efforts by drug gangs to move U.S. dollars in amounts under $10,000 south to Central and South America.  What was not reported was the legitimate cash flowing in from the online poker operations.

The U.S. indictment of key figures in poker operations here also revealed extensive investments in real estate being made with the earnings from the online operations. The flow of money into the country may have been as much as $50 million a year. The poker operations took in $3 billion over the course of the U.S. investigations, agents there said.

Federal agents said that executives of the poker companies tried to circumvent the 5-year-old U.S. regulations that prohibited banks and credit card companies from making payments for overseas gambling.

Money received from U.S. gamblers was disguised as payments to hundreds of non-existent online merchants purporting to sell merchandise such as jewelry and golf balls, federal officials said. Of the billions of dollars in payment transactions that the poker companies tricked U.S. banks into processing, approximately one-third or more of the funds went directly to the poker companies as
revenue through the rake charged to players on
almost every poker hand played online, the officials said.

Among other charges facing the poker company executives is that of money laundering. The indictments also outlined an agreement between a small Utah bank and representatives of the poker companies here to disregard the U.S. prohibition.

The U.S. dollar has been depressed for a year. For the last several months a U.S. dollar could purchase 498.5 colons. The rate had been as high as 582 colons to the U.S. dollar. The situation brought pleas from the sectors of the economy, like tourism and agricultural exporters, that received funds in dollars but had to make payments in colons. Expats on fixed U.S. incomes also expressed unhappiness.

At midday Tuesday, Banco Nacional said a U.S. dollar there could buy 500.5 colons and that 510 colons were required to purchase a U.S. dollar. By nightfall the rates were 502.5 and 512 colons. Banco de Costa Rica lagged at 500 and 510.

At the same time A.M. Costa Rica began fielding applications for employment by bilingual individuals who were responding to a two-week-old classified.  Blanca Games, the parent firm for Absolute Poker and Ultimate Bet, began laying off employees in Costa Rica last week.

The company, like others in Costa Rica, in the face of the indictments ended the practice of accepting  money from U.S. customers and began to consider ways to return funds that U.S. citizens already deposited.

Gambling operators and call centers have long been major employers of bilingual Costa Ricans. Frequently this meant that there were few bilingual applicants for other types of jobs, such as tourism.

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Drivers warned to stay off
Ruta 32 during the night

By the A.M. Costa Rica staff

Transport officials are clear: Stay off Ruta 32 in the night particularly when there is rain.

This is the troubled San José-Guápiles highway where a steep cliff on one side has been crumbling as the road passes through Parque Nacional Braulio Carrillo. This is the main highway to Limón from the capital.

Another large quantity of rock and dirt gave way Sunday night and closed the highway. At first there were fears that vehicles were trapped in the slide. The resulting debris was 150 feet wide and 25 feet high.

Highway officials opened the road between 6 a.m. and 10 a.m. Tuesday, mainly so the backup of tractor-trailers could continue on their route. Then after more cleanup, the roadway opened about 3 p.m.

The slide Sunday happened during the first few rainy days of the season, suggesting that many more slides are likely.

Last year, officials put a monitoring station at places where slides were likely. That generally is the area before and after the Zurquí tunnel. A television cameraman shot video of a large slide tearing down the mountain.

Now the Ministerio de Obras Públicas y Transportes said clearly that officials recommend that motorists do not drive through the zone because of the high level of danger before possible new landslides and the persistent rain.

This route and the San José-Caldera autopista were trouble spots until the rains let up in December. Officials generally agree that Ruta 32 needs some major rebuilding. They have been critical of the design that basically runs a major highway along a ledge with a steep cliff to the west and a steep dropoff to the east.

Officials are recommending a longer, slower Ruta 10 through Turrialba for trips to Limón during rain. However, that road is narrower and more difficult for drivers of large trucks.

Fraud and theft suspect
returned from El Salvador

By the A.M. Costa Rica staff

A woman from the Cameroons has been returned to Costa Rica to face allegations that she defrauded a Costa Rican couple with a fake scheme to build hotels on the Caribbean coast. The  Corte Suprema de Justicia in El Salvador authorized her extradition in early April.

The Poder Judicial identified the woman as Clemence Kamdem Djimi. The Poder Judicial said she passed herself off as a French investor in 2007 and 2008 and managed to obtain $15,000 in financing for her project. She then stole jewels and about $150,000 in cash from a safe, according to the current allegations.

Prosecutors allege that she fled the country in September 2008 for El Salvador with $143,000 in cash. Her arrival there did not go well because officials there found the money hidden in her body and asked her to justify the origin and then lodged a money laundering case against her. She was sentenced to two years and six months in prison but was granted conditional liberty in what amounted to work release, said sources in El Salvador.

Costa Rica sought her return in January 2009, and the woman was rearrested.

Puriscal, Hatillos have outages

By the A.M. Costa Rica staff

Thieves cut fiber optic and copper cables about 4:30 a.m. Tuesday and cut off fixed line telephone and Internet service and part of the mobile network in the Hatillos, Sabana Sur, Barrio Cuba, San Sebastián and La Uruca.

Four hours later in San Antonio de Puriscal someone stole mobile telephone equipment and disrupted the 3G service for La Gloria, Cerro Sabanas, San Rafael Abajo de Pursical, San Isidro de Tulín, Guayabo de Mora, Sabanillas de Acosta, Las Delicias and Bijagual de Turrubares, said the Instituto Costarricense de Electricidad.

Find out what the papers
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By the A.M. Costa Rica staff

Here is the section where you can scan short summaries from the Spanish-language press. If you want to know more, just click on a link and you will see and longer summary and have the opportunity to read the entire news story on the page of the Spanish-language newspaper but translated into English.

Translations may be a bit rough, but software is improving every day.

When you see the Summary in English of news stories not covered today by A.M. Costa Rica, you will have a chance to comment.

This is a new service of A.M. Costa Rica called Costa Rica Report. Editor is Daniel Woodall, and you can contact him HERE!

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San José, Costa Rica, Wednesday, May 11, 2011, Vol. 11, No. 92
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A break in a 50-year-old water line adjacent to Teatro Nacional Tuesday left about 130,000 San José residents high and dry until repairs were made in late afternoon. Officials said the whole water network is old and vulnerable.

Concessions, Caldera highway come under legislative fire
By the A.M. Costa Rica staff

Legislators who once were in the opposition are wasting no time in trying to change some of the policies they do not like.

The general concept of concessions and specifically the concession for the San José Caldera highway are among the policies under fire. Also targeted is the approval of private insurance companies to sell riesgo de trabajo or workmen's compensation insurance.

José María Villalta Florez-Estrada, the sole legislator from the leftist Frente Amplio, presented his 54-page study on the Caldera highway. He presented it to a special commission studying concessions that have been granted in the country, although he is not a member of that group.

His report seeks political sanctions against those public officials involved in the highway project. Among these is former president Óscar Arias Sánchez.

The legislator said that the highway concession will cost the Costa Rican public $400 million, which basically comes from the tolls the private concessionaire is levying.  He also said that Arias pushed the highway project even though the Costa Rican state was not prepared institutionally to guarantee the success and oversee the project. He also noted that Arias inaugurated the highway just 10 days before the 2010 general elections. The project has been in the works for 30 years.

The highway has been plagued by landslides, including one that killed a woman motorcycle passenger. Villalta produced a litany of names of present and former officials that he wanted to be barred from public service.

Villalta also said that the Ministerio Público, the independent prosecutorial agency, should investigate the highway concession for possible corruption.
He also said that he recommends to the Asamblea Legislativa that the concession law be revised and that the executive branch immediately begin collecting fines from the concession holder, Autopista del Sol.

He also recommended that the process of concessions be halted until changes are made.

The executive branch has promoted concessions because it says it does not have the money to construct needed public works. A major issue now is the $1 billion concession awarded to a Dutch firm to build a modern port facility in Moín. That project is strongly opposed by the dockworkers union there.

Villalta also figured in another criticism. He said in another session that some unions have given him their support for an action of unconstitutionality directed at an article in the Free Trade Treaty with the United States that allows private insurance firms to sell workmen's compensation insurance.

The Instituto Nacional de Seguros was the monopoly insurance provider until the free trade treaty went into effect. Representatives from that agency's union and also from the Asociación Nacional de Empleados Públicos y Privados supported the idea of a constitutional challenge. Some members of the Partido Acción Ciudadana also joined in the call.

The critics basically said that social rights should not be subject to the marketplace. The Sala IV constitutional court already reviewed the free trade treaty before it went into effect.

Villalta and Acción Ciudadana lawmakers were among the coalition that managed to win leadership positions at the start of the new legislative session this month. They are attempting to make the changes that they have promoted for the last year without success because they did not have legislative control.

Five suspects in home invasion murder get 30 years each
By the A.M. Costa Rica staff

Five home invaders linked to the murder of an elderly Cartago man each got 30 years in prison in criminal court Tuesday.

The murder took place on Aug. 18, 2010, said the Poder Judicial. The dead man was Efraín Arias Chinchilla, 82.

The crime took place in Llano Bonito de San Pablo in León Cortés.

The five men wearing masks broke into the home and surprised the man, his wife and a son about 9 p.m. The intruders tied up the wife and son and then took the man to
his room where they demanded money. When the man refused or said there was no money the men became enraged, beat him and smothered him with bed coverings, said investigators at the time. They then threatened the wife, who told them where some money was, police said.

They took jewels and fled in two vehicles. Police were able to detain the suspects at a roadblock because sons of the man made quick calls after the intruders fled.

The men convicted Tuesday were identified by the last names of Morales Rey, Cerdas Varela, Retana Martínez, Blanco Ramírez and Campos Martínez. 

The case was in the Tribunal Penal de Cartago.

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Former scamster here convicted on 12 felony counts in U.S.

Special to A.M. Costa Rica

Following a two-week trial, a federal jury in Miami Tuesday convicted Sirtaj “Tosh” Mathauda on 12 felony counts related to a fraudulent business opportunity scheme, the Justice Department announced. The jury convicted Mathauda of conspiracy, nine counts of mail fraud and two counts of wire fraud.

The operations were run out of Costa Rica.

A federal grand jury returned a second superseding indictment against Mathauda March 30, 2010, charging that he and his co-conspirators operated a string of bogus companies known as Apex Management Group, USA Beverages Inc., Omega Business Systems and Nation West Distribution. The companies operated largely out of phone rooms in Costa Rica and marketed to residents in the United States.  The companies sold opportunities to own and operate vending machine routes, beverage distributorships and greeting card distributorships. The so-called business opportunities were promoted as including retail display racks or vending machines, high-traffic locations in which they would be placed, and assistance in maintaining and operating such businesses. The promises of good locations and business assistance were fabricated, federal officials said.

As the evidence presented at trial showed, Mathauda owned, managed or worked at the fraudulent companies in Costa Rica, one after another, from 2004 through early 2009. Salesmen in the phone rooms told potential customers that the companies were located in the United States and would provide profitable distribution routes for vending machines or retail display racks.  Salesmen said that the companies had a track record of success, claims that were backed up by phony references pretending to be satisfied customers of the companies in calls to customers.  Many of the references were in reality the salesmen for the companies.
Several of Mathauda’s co-conspirators, including his
brother, Dilraj “Rosh” Mathauda, as well as Stephen Schultz, Silvio Carrano, Donald Williams, Patrick Williams and Gregory Fleming, previously pleaded guilty in Miami in connection with their roles in the fraudulent business opportunity scams.  All of these defendants were charged as part of the government’s continued nationwide crackdown on business opportunity fraud.

“Business opportunity fraud imposes major financial hardship on innocent, hardworking victims,” said Tony West, assistant attorney general for the Justice Department’s Civil Division. “The Department of Justice will continue to prosecute aggressively those who are exploiting consumers to make a quick buck for themselves.”

Mathauda faces a maximum sentence of 25 years in prison on each count of conviction, a possible fine and mandatory restitution. Most of the victims were older and many were retirees looking for supplemental income.

“This verdict demonstrates that individuals living outside of the United States will not be allowed to use technology to commit fraud on the American public. This investigation illustrates our resolve to protect American consumers from business scams, wherever they occur,” said the U.S. postal inspector in charge, Henry Gutierrez, based in Miami.

The scamsters used voice-over-Internet protocol to cause victims to believe they were calling from inside the United States. They also used mail drops, including one in Fort Collins, Colorado.

The scamsters were one of several groups bilking U.S. citizens around the same time. Others were selling discounted computers that would never be delivered. Others were and still are operating a fake lottery scam in which they tell victims that they have won substantial sums and seek advance payment for delivery of the money.

Panama's Martinelli asked to investigate smearing of press

Special to A.M. Costa Rica

The Inter American Press Association Tuesday asked Panamá President Ricardo Martinelli’s government to investigate campaigns against journalists designed to undermine the credibility of the press and that are producing a major cleft in freedom of expression.

In recent weeks several journalists, among them the head of the investigative reporting team of the newspaper La Prensa, Lina Vega Abad, have been the subject of insults and a campaign to slur their reputations in videos posted anonymously on YouTube and in television ads. Ms. Vega Abad’s professional and personal life were questioned in retaliation, it was reported, for her reports on government wrongdoing.

A spot broadcast on television by the governing Democratic Change Party over the weekend also cast doubt on the integrity of Santiago Cumbrera, a reporter with the La Prensa unit, over his investigations into the dissemination of Wikileaks cables that exposed government officials.
Gonzalo Marroquín, press association president and president of the Guatemala City, Guatemala, newspaper Siglo 21, declared, “It is clear that the journalists are being discredited to harm their reputations and consequently undermine their credibility before the public. So it is the government’s responsibility to investigate the matter and punish those responsible in order to ensure freedom of the press.”

Early last month Alvaro Alvarado, a reporter and host of TV Canal 13’s morning news program “Telemetro,” complained of campaigns to discredit him. La Prensa recalled that during 2010 other anonymous videos had been used to discredit the newspaper’s then legal affairs editor Mónica Palm.

In its recent biannual report on the state of press freedom in the Western Hemisphere the Inter American Press Association warned of the state of confrontation that exists between the government and the press in Panamá, declaring that the federal administration there tends “to blame the news media for some situations and events that are of a public nature.”

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San José, Costa Rica, Wednesday, May 11, 2011, Vol. 11, No. 92

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Another polling dead heat
for Peruvian elections

By the A.M. Costa Rica wire services

A new poll in Perú shows that conservative candidate Keiko Fujimori now has a slight lead over leftist former army officer Ollanta Humala with one month to go before runoff presidential elections.

The poll, released Monday, gives Ms. Fujimori 41 percent of voter support, compared with 39 percent for Humala.  The runoff takes place June 5. The results are a statistical dead heat.

In the first round of balloting last month, Humala won 32 percent of the vote, falling short of the 50 percent margin needed for an outright win.  Ms. Fujimori took 24 percent.

Ms. Fujimori is the daughter of imprisoned former president Alberto Fujimori, who is serving a 25-year prison sentence for his role in death squad killings in the 1990s.  There has been much concern that his daughter would try to free him if elected.  Keiko Fujimori has apologized for mistakes and crimes committed while her father held office. He was president from 1990 until 2000.

Humala, who led an uprising against Alberto Fujimori in 2000, lost a runoff election to current President Alan Garcia in 2006.  Humala was outspoken during that campaign about his admiration for Venezuelan President Hugo Chávez, but has since distanced himself from the leftist leader.

Much of the presidential campaign has focused on continuing the rapid economic growth of recent years, while ensuring that the poor also see some of the increased prosperity.

New Arctic Council plans
to consider sea level rise

By the A.M. Costa Rica wire services

U.S. Secretary of State Hillary Clinton is expected to join fellow foreign ministers from the eight-nation Arctic Council Thursday in Greenland's capital, Nuuk, for a meeting on polar region issues, including the receding Arctic ice cap.  The meeting follows the release of a council report that Arctic warming and the resulting rise in sea levels might be much greater than previous forecasts.

It will be the seventh ministerial-level meeting of the Arctic Council, made up of the countries surrounding the Arctic Ocean.

But Deputy Secretary of State James Steinberg says the Greenland session will be historic in that the grouping will create a permanent secretariat, and sign its first legally-binding common agreement on Arctic search and rescue operations.

At a preview seminar at Washington's Center for Strategic and International Studies, Steinberg said the Greenland meeting will strengthen the Arctic Council's role as the preeminent world body for Arctic affairs and underline cooperation on regional environmental and maritime issues.

In addition to the United States and Russia, the Arctic Council includes Canada, Finland, Iceland, Norway, Sweden and Denmark, which is in the grouping because of its administration of Greenland.

Indigenous communities from around the Arctic region are also represented.  Countries not bordering the Arctic Ocean, but with interests in the region, have criticized the notion of a permanent structure for the Arctic Council.

The State Department's Steinberg said another key objective of this week's meeting will be to agree on criteria for observer status for other interested countries and organizations.

The deputy secretary said data suggest that the Arctic region is warming two to three times faster than the rest of the world, and that council members will discuss new steps to curb emissions of black carbon, methane and other gases linked to climate change.

A study conducted under Arctic Council auspices and released last week in Copenhagen said Arctic warming and resultant melting of polar ice could raise sea levels by as much as 1.6 meters by 2100, almost three times more than forecast in a landmark United Nations study five years ago.

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Ministerio de Gobernación, Policía
y Seguridad Pública photo
This is part of the evidence confiscated Tuesday.

Desamparados man held
as supermarket stickup suspect

By the A.M. Costa Rica staff

A man believed to be a member of a gang of supermarket bandits came into police hands Tuesday when they found him at home in San Lorenzo de Desamparados. The Judicial Investigating Organization said that he is a suspect in at least five supermarket stickups.

Agents said the man had a .38-caliber pistol when detained as well as ammunition for various weapons, including a shotgun. He also had a bulletproof vest.

Police make strong showing
in two high-crime areas

By the A.M. Costa Rica staff

Police have been entering in force two areas where they previously were not anxious to go. The areas are Sagrada Familia and La Carpio, both low-income parts of the city infested with crime.

Police questioned 2,355 persons between April 30 and Monday.  They arrested 15, including eight who were the subject of outstanding warrants, they said Monday.

Police also confiscated marijuana, cocaine and crack. More than 300 police officers were involved in the twin operations.

Europe is growing market
for illegal cocaine use

Special to A.M. Costa Rica

Cocaine use continues to surge in Europe, the top United Nations anti-drugs official warned Tuesday, outlining what he called “the dramatic evolution of the international market” for the drug in the past decade.

Yury Fedotov, executive director of the U.N. Office on Drugs and Crime, addressed a meeting of government ministers in Paris that aimed to enhance international efforts to counter transatlantic cocaine trafficking.

“Despite a declining market in North America, the use of cocaine continues to rise in Europe. In 1998, the U.S. cocaine market was four times higher than that of Europe,” he told the meeting.

“Since then, there has been a complete rebalancing with the value of Europe's market now estimated to be worth some $33 billion, almost equivalent to that of the United States’ $37 billion.”

From market diversification and growing cocaine use in Europe, through to new delivery routes, Fedotov stressed that today’s cocaine market has become a global threat.

The anti-drugs agency estimates that global cocaine sales generated around $84 billion in profit in 2009 – a sum equivalent to or even exceeding the gross domestic product of many developing countries.

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