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These stories were published Monday, May 16, 2005, in Vol. 5, No. 95
Jo Stuart
About us
A good day to stay home
Anti-free trade marchers to descend on city
By the A.M. Costa Rica staff

Union members, taxi drivers, students and farmers, among others, will take to the streets today in a demonstration that joins these groups through their opposition to the proposed free trade treaty with the United States.

Other members of Public employee unions threaten to take action against utilities and the Internet. School teachers are involved in the protest, and school administrators will have to cover for missing personnel.

The protest starts at 6 a.m. in front of the headquarters of the Instituto Costarricense de Electricidad in Sabana Norte. Unionized workers there believe that the free trade treaty will destroy the utilities monopoly known as ICE. They will march to the western end of Paseo Colón in time to tie up most incoming traffic. They will be joined by employees of the insurance monopoly, Instituto Nacional de Seguros, and others.

Farmers will join the march at Parque La Merced on Avenida 2. Not all farmers oppose the treaty. Opposition stems mainly from rice farmers who fear outside competition.

University students will be marching from the Universidad de Costa Rica in San Pedro to join up with the growing protest at either Casa Presidencial in Zapote or the wave of marches headed for the Asamblea Legislativa. Many 

students are propelled by their anti-American sentiments.

The march is being coordinated by the Asociación Nacional de Empleados Públicos and similar protest will be held elsewhere.

Blockades of highways at strategic points are possible.

Although organizers say they are planning a peaceful protest, loudspeakers generally are used to inflame the crowds.

Among those who oppose the free trade treaty is a feminist group Mujeres contra el TLC, as the treaty is known by its Spanish initials. Radio Internacional Feminista will be broadcasting via the Internet part of the march.

The government said Sunday that public employees will not be paid if they duck work to march and protest.

Although the march has been long in planning, President Abel Pacheco’s seeming support of the free trade treaty during a trip to the United States last week has hardened the opposition. Pacheco is due back from his trip later today.

Some participants in the march have their own concerns in addition to the free trade treaty. Taxi drivers want to eliminate the vehicle inspection program run by a government designated monopoly.

A.M. Costa Rica photo
Why is 
this man

Stephen I. Tashman, a consultant for Paragon Properties, is happy because his firm has sold out seven land development projects in the central Pacific.

The controversial company and Tashman are aggressive Internet marketeers and will be sending out 30 million e-mails a week.

But now comes the next part. The company has to install utilities and roads to service the properties it already has sold.

See story BELOW!

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San José, Costa Rica, Monday, May 16, 2005, Vol. 5, No. 95

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Father figure in Limón
goes to grave with carnival

By the A.M. Costa Rica staff

Limón residents said good-bye Saturday to Alfred Henry Smith, an 88-year-old barber and cultural figure in the Caribbean city.

King was considered the originator of the Limón carnival, and the funeral procession to the local cemetery seemed like a carnival with dancers, two bands and many floral tributes.

King had 17 children and also made a strong impression on other children in the Limón community in his capacity as leader of the Universal Negro Improvement Association of Limón and as a sports promoter.

The Limón carnival is in October.

Bilingual services were at the San Marcos Episcopal Church.

King was born in Parismina June 11, 1916. He was know affectionately in the community as "The King" or Mr. King. The name came from his ability to dance as a young man and the contests he won.

King died May 8. He was eulogized last week by Epsy Campbell Barr, a deputy, who described his life to the Asamblea Legislativa. She said that Smith was a follower of the Jamaican Marcus Garvey and kept the association functioning for the last 60 years.

The organization’s headquarters in Limón is known as the Black Star Line.

Cut in fuel prices asked
by executive branch

By the A.M. Costa Rica staff

The government will ask for an immediate reduction in the price of fuel, Vice president Lineth Sabrío said over the weekend.

The request is based on the drop in the international price of petroleum during the last two weeks, she said.

Typically the Autoridad Reguladora de Precios de Servicios Públicos takes 15 or more days to make a price change. And then there is at least a five-day wait while the measure is published in the official newspaper, La Gaceta.

Vice president Saborío said that the government would ask the authority to decide on a new price in the shortest time possible "because every day that passes hits the pockets of Costa Ricans more,’ she said.

The government’s decision came the weekend before a national strike that includes taxi drivers who have been hard hit by the higher fuel prices.

Career diplomat appointed
to Nicaraguan post

Special to A.M. Costa Rica

A career member of the U.S. foreign services will be nominated to serve as ambassador to Nicaragua, according to the White House.

President George Bush intends to nominate Paul A. Trivelli, of Virginia for that post, an announcement said.

Trivelli currently serves as director of the Office of Policy Planning and Coordination for the Bureau of Western Hemisphere Affairs at the Department of State. He previously served as director of the Office of Central American Affairs at the Department of State. Earlier in his career, Trivelli served as deputy chief of mission in Tegucigalpa. 

He earned his bachelor's degree from Williams College and his master's degree from the University of Denver.

Our readers write

Drugs and free trade
prompt his comments

Dear A.M. Costa Rica:

Re: Las Vegas Franz letter regarding Tamarindo and the number of jailed Americans in the U.S.A. due to "soft drugs." I don't know what the writer is referring to: Marijuana, cocaine, crack, morphine, ecstasy, speed, heroin? 

Simple possession of marijuana is not going to land you in jail in most states.  You have to be a dealer, distributor, or manufacturer to get some jail time. Since he seems to know so much about this, maybe he can provide us with some statistics regarding these two millions drug offenders.  How many first time marijuana users are currently serving time out of the two million. 

If he feels we should legalize all drugs let him say so. 

Secondly, your article regarding Cafta and President Pacheco.  I love Costa Rica as a second home, but the unions self-interested tails are wagging the dog. A strike by the unionists to protect their monopolies, and have Costa Rica fall further and further behind other countries that have realized that competition is the answer, and not the problem, is injurious to all the Costa Ricans.  It is interesting to me, reading both the Costa Rican version and the U.S.A. version of the opposition to Cafta, that they use the same arguments. 

Loss of jobs to the other country (U.S.A. loses jobs to Costa Rica [US version], Costa Rica loses jobs and sovereignty (read "the monopolies are open to competition)[Costa Rican version]).  The facts in the end is both countries will lose and gain jobs. 

They will both lose and gain jobs whether the treaty is passed or not.  But it is in the best interests of all Central American countries to improve their economies, learn how to compete in the world, and acquire from the industrialized countries the technical expertise to advance from Third World to at least Second World. 

This is a very high tech world, and it changes monthly, if not daily, the monopolies are not interested in progress, but maintaining their power at the expense of the country.  It is truly a shame, that a country having so much going for it, is held hostage by special interests.

Mike Hankins
Santa Ana, Calif.
Condo article praised

Dear A.M. Costa Rica:

Thank you for your May 9th article in titled: "Water, sewers, environment are factors to consider: Boom in beach condos could cause oversupply." 

I believe you have done all potential investors in Costa Rica a great service by highlighting the real considerations and realities of buying or building in Costa Rica.  It took a lot of courage to put these truths in print.  You are intrepid.  I salute you!  Great job . . . masterfully done! 

Robert Campbell 
Playa Hermosa, Guanacaste
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Telephone 305-3149 or 256-8620


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When being a slowpoke is really a good thing to do
Más lerdo que la quijada de arriba

"Slower then the upper jaw." Well, of course one’s upper jaw does not move at all, and this dichois often used to describe someone who is very slow moving indeed and is, therefore, often late. A variation of this is más lerdo que un perezoso,meaning slower than a sloth. If you’ve visited the Manuel Antonio National Park, near Quepos, you may well have seen one of these animals hanging from a tree, or trying to get across a road. If so, you’ve probably observed how slow and deliberate they are in their movements. An interesting fact about the sloth is that they only come down from the trees about once a week.

Más lerdo que la quijada de arribaapplies to almost everyone in Costa Rica in one way or another. Some people drive very slowly on the autopista while others are consistently late for appointments. But I know of no other Tico for whom this dicho is more appropriate than my brother. His is an interesting case, however, because he is never late for work. About his job, or anything relating to it he is most diligent and conscientious. But if we are going to go on a trip, for example, I always tell him to be ready at least two hours before our actual departure time. Otherwise, his tardiness will make us all late.

Last Saturday he needed to go to San Juan de Dios hospital for a series of tests relating to a stomach ailment he’s been suffering from. I told him the night before that we could pick him up at home and drop him off at the hospital on our way down town to an 11 o’clock meeting. At 9 o’clock the following morning I called to tell him that we’d be at his house to pick him up in forty-five minutes. 

At a quarter to ten I called and told him we’d be in front of his place in five minutes. Of course, as fate would have it, when we reached his street there was a procession, in honor of the Blessed Virgin, coming out of the local parish church. The procession turned the corner and headed right down my brother’s street. So, of course, we were prevented from driving down his street. I called him on my cell phone and told him that because of the procession we could not reach his house and he should walk down to the corner where we were waiting. To which he replied: "I’m on my way." 

Well, we waited, and waited until the entire procession had passed by and my brother still hadn’t shown up. So, since the street was now clear, we drove down to his house. And there he was, just leaving the front gate! 

Más lerdo que la quijada de arribacould also apply to the government, especially here in Costa Rica. I always laugh when my friends from the U.S. get frantic because the Costa Rican government has passed this or that new law that might apply to them. My answer always is, "relax." It will probably take another 10 years before the law will take effect. 

way we say it

By Daniel Soto

First the congress will spend months debating over it, then the law will spend the next two to three years in la Sala IV, our pre-supreme court, where its constitutionality will be argued over. 

After that, there will be innumerable appeals or the government will be  sued because undoubtedly the new statute violates someone or other’s rights. After all this, if the now no longer "new" law still survives then the government must find the money to implement the measure. 

By this time the law may not even be needed any longer and another "new" law will be enacted to take its place. So you see why Costa Ricans are a little laid back when it comes to changes in their laws. 

Now, some may find it annoying that the government of Costa Rica is más lerdo que la quijada de arriba,but I think sometimes democracy needs time in order to function as it should. 

Change comes slowly here, it’s true, but everyone has a chance to question the efficacy and soundness of new laws and government regulations that may affect them — unlike the Patriot Act in the United States, for example, which was rushed through Congress so fast in the wake of the 9/11 disasters that two thirds of the senators and representatives who voted for it didn’t even have the time to read it. 

Now, there are many questions and concerns about the negative impact of this law upon human rights and civil liberties in the United States. 

So, maybe más lerdo que la quijada de arriba,or más lerdo que un perezoso, is not always such a bad thing. When it come to our governments, at least, we hope that extra time will be taken to deliberate carefully over laws that may impact us simple citizens in a very negative way. Sometimes lawmakers need to slow down a little in order to make certain that the laws they enact in order to protect us are not going to turn us into the very thing they’re seeking to protect us against. 

Genesis fund indictments listed six persons in U.S.
By the A.M. Costa Rica staff

When law enforcement officials here were arresting executives of the defunct Genesis Fund Wednesday, agents in the United States were taking five more persons into custody there.

A ninth person is a fugitive and believed to be somewhere outside the United States.

The indictment charges conspiracy, multiple counts of mail fraud and wire fraud, money laundering, obstruction of justice, obstruction of a criminal investigation, tax evasion and several other tax-related charges.

The U.S. government characterized the fund as a Ponzi scheme in which interest payments are made from funds provided by new investors.

The Genesis Fund was relocated from Anaheim, California, to Costa Rica in April 2000. The three persons arrested here to face extradition were identified by the U.S. Attorney’s Office as:

• John S. Lipton, 58, a founder and the principal manager of the Genesis Fund, who lived in Mission Viejo and Laguna Hills, California, until about March 1998 w hen he relocated to Costa Rica;

• Richard B. Leonard, 71, another early investor, and later a promoter and manager of the Genesis Fund, who lived in Littleton, Colo., until he relocated to Costa Rica in about June 2000; and

• Victor H. Preston, 64, a founder and manager of the Genesis Fund, who from about July 1994 to about June 2000 lived in Huntington Beach and Laguna Hills, Calif., after which he relocated to Costa Rica.

Lipton and Leonard lived in the upscale Tangomar subdivision on the east shore of the Nicoya Peninsula. Preston lives in La Sabana.

A summary of the indictment was provided by the U.S. Attorney’s Office:

The indictment alleges that between May 1998 and June 2002, Genesis Fund investors entrusted more than $80 million with the defendants. The defendants — through promotional materials, account agreements and other means told investors that their money would be pooled and invested in foreign currency trading through a currency dealer in Hong Kong and Macau who had earned large profits for investors in the past. 

Instead, the indictment alleges, virtually all investor funds were used to make Ponzi payments to investors and to personally enrich the defendants.

The indictment also alleges that in June 2002 — just weeks after advising investors that the Genesis Fund was worth $1.3 billion, investment, trading and payment activities in the fund were suspended. After the collapse of the Genesis Fund, the defendants presented investors with a new investment plan to lull them into believing that there was hope of recovering their money.

The indictment also alleges that the defendants promoted the Genesis Fund as having no reporting obligations to the U.S. Internal Revenue Service. Bank accounts in the names of trusts and offshore bank accounts in Costa Rica and Belize, among other places, were allegedly used to receive distributions from the Genesis Fund that were not reported to the IRS. 

Some of the defendants allegedly created  "disclosed" and "undisclosed" Genesis Fund accounts for themselves and certain Genesis Fund investors in order to conceal from the IRS all but a small portion of Genesis Fund distributions, the government said.

In addition, some Genesis Fund investors were allegedly advised to create nominee offshore corporations and bank accounts to receive distributions from the Genesis Fund, said the indictment.

The indictment further alleges that to obscure the operations of the Genesis Fund and to limit scrutiny of its operations by investors and the United States government, the defendants caused the Genesis Fund to maintain no financial statements or other statements of operation. 

The indictment also alleges that, in an effort to conceal the true nature of the Genesis Fund from investors and the government, the fund’s administrative operations were relocated from Anaheim, California, to Costa Rica in April 2000. At this time, paper records and electronic data on computers were hidden or destroyed. 

The indictment was returned by a federal grand jury in Los Angeles March 30. 

The five defendants who were arrested in Southern California were identified by the U.S. Attorney’s Office as:

• David L. Johnson, 66, an early investor, and later manager and promoter of the Genesis Fund, who lives in Walnut;

• William H. Nurick, 69, a founder and manager of the Genesis Fund, who lives in Camarillo;

• Denise Taylor-Fraser, 51, a Genesis Fund investor who later became a manager, who lives with her husband in Riverside;

• William Taylor-Fraser, 57, Denise’s husband, a Genesis Fund investor who became one of its managers during the summer of 2000; and

• Teresa R. Vogt, 51, a primary administrator and later a manager of the Genesis Fund, who lives in Anaheim.

Still at large is Marlyn D. "Milt" Hinders, 65, a leading promoter and manager of the Genesis Fund who lived in Aurora and Parker, Colo., from about July 1994 until about May 2004, when he moved to Mexico.

A special agent with the State Department’s Bureau of Diplomatic Security assigned to the U. S. Embassy in San Jose, worked with the IRS attaché in Mexico City, to coordinate the arrests here the U.S. Attorney’s Office said.

Julian Siegel is the man in charge of turning a chunk of Costa Rican countryside into a residential community. He explains how he is doing that.

A.M. Costa Rica photos

Internet marketer Paragon sold out seven subdivisions
By  the A.M. Costa Rica staff

Paragon Properties of Costa Rica S.A. has sold out seven major developments and has purchased land for two more, according to a company representative.

This is the firm that is marketing subdivision land to North Americans via e-mails, Web pages and call centers. In fact, the company plans to send out 30 million messages a week, said the representative, Stephen I. Tashman.

Tashman and others connected to the Height of Pacifica development some 14 kms. (about nine miles) north of Quepos on the Central Pacific coast gave a reporter a tour Friday.

Heights of Pacifica one-acre lots originally sold for $19,900. But lately the company sold lots of one hectare, 2.47 acres, at its other projects for $60,000, Tashman said.

Because of its aggressive Internet sales approach, the company has generated a lot of interest about Costa Rica among U.S. citizens but also concerns among persons living here. The bulk of the concern stems from Paragon’s horse-before-the-cart approach. Tashman, a Miami. Fla., resident, said that the company got caught up in the complex Costa Rican regulations and had to resort to some creative methods.

One such method is selling property in Heights of the Pacifica via newly formed, individual Costa Rican corporations. That’s because the company does not yet have full approvals to subdivide the sprawling tract. Tashman said that studies still are being done on the three stages of the subdivision with the Ministerio de Ambiente y Energía.

When the firm began to develop other properties, subdivision was done via less stringent agricultural rules, which is why the resulting lots are one hectare instead of an acre, he said. With this form of land division, full ownership can be given buyers within 30 to 60 days, he said.

In any case, the property is sold in other tracts as a contract for deed. Full ownership is transferred after the buyer pays the full price. But they have five years to do that if they have put down a payment roughly half the final price. Tashman said the company is not charging interest to buyers.

In addition, he said that the company plans to make a profit on building homes on the land. No homes exist there now, although Tashman said that some show homes will be constructed. 

In the first section of Heights of Pacifica roads have been designed and cut with heavy equipment. Many tons of gravel have been spread on the road in advance of the heavy rains that take place in the central Pacific from May until December. Rainfall averages a bit more than 16 inches a month in this area.

A company, Soluciones para Aguas Residuales S.A. from San Isidro de El General has installed four-inch PVC water supply lines and has stubbed out supply lines to individual lots. However, according to David Rice, an engineer and a principal of that firm, the source of the water has not yet been determined. He said a decision is due in a week.

The choices are to sink a well at one of the springs on the property or to sink a well at a nearby river. He is leaning toward the first option so that right-of-way problems are not encountered. Digging a well will require additional permits.

Rice and his company also are designing sewage systems for the project, but that concept is not complete.

Typically in a North American subdivision, sewer lines, water lines hard-surfaced roads and sidewalks are in before home construction begins.

A Costa Rican, Estaban Soto of Heredia and a Fort Lauderdale, Fla., man, Julian Siegel, are in charge of construction at the site. Some 5 kms. (3.1 miles) of road have been put in for the estimated 88 one-acre lots in the first section of Heights of Pacifica. The site is some four miles east of the coastal highway in an area under the control of the Municipalidad de Parrita.

Water engineer David Rice shows where his workers have stubbed out service for a residential lot from a subsurface four-inch main.

Although some of the land is flat, the eastern part is heavily contoured and challenging for engineering efforts. The property was a ranch, and long-eared white cows still roam the areas. The rolling eastern end of the property provides postcard-quality views of the Pacific.

Tashman said that the company’s problem is in maintaining an inventory of land. Land prices have increased in the central Pacific area, in part because of Paragon’s activities. So the company has moved further afield seeking ocean-view land. The area between Jacó and Quepos is abuzz with real estate projects.

Paragon is opening a sales office near Cariari Mall west of San José, in part to market home construction to those who already own building sites, said Tashman.

Tashman takes credit for another controversial aspect of the company’s sales technique. Land buyers are invited to visit for a free tour of Costa Rica but first they have to put cash equal to a down payment in escrow with a Florida lawyer. Tashman said he came up with that idea because he originally made eight trips to Costa Rica to show property to would-be buyers and never made a deal.

Charles L. Neustein, the Miami, Fla., lawyer holding the money has a good reputation among his peers, according to ratings available on the Internet. However, once the buyer approved the land and signs an agreement to purchase, the money is transferred to Paragon, said Tashman. If the visitor decided not to buy, the money is refunded. Tashman said millions have been refunded to individuals who, for some reason, did not like the concept.

Tashman says he is not a principal in the project but a consultant. He has a history of civil suits by U.S. regulatory agencies. He was involved in vending machine sales, oil and gas drillings, ostrich farming and recently pre-paid telephone card sales. He is quick to point out that he never has faced a criminal allegation and said that government regulators picked on him because of his innovative approach to marketing.

Tashman also has supervision over the phone rooms that are selling the project in the United States. He said he knows each phone room operator and has personally approved the sales scripts. In addition, buyers get a questionnaire to make sure that phone salesperson stuck to the facts, he said.

Telephone salespeople are on commission and collect about 13 percent of the total sales price.

If Paragon has indeed signed contracts on all of the 498 lots in its Quepos-area holdings the company has significant assets in cash for installing utilities. Selling all of Heights of Pacifica for $19,000 and marketing the remaining four projects for $60,000 a hectare would generate from $8.3 million to $14.6 million after commissions depending on how much buyers put down. 

The contract for Heights of Pacifica gives Paragon a year to install the utilities.

Company has two projects in the planning stage
Here is a list of the Paragon projects:

Heights of Pacifica I (88 lots), II (85 lots) and III (more than 85 lots), about 14 kms. north of Quepos. Sold out.

Gables adjacent to Heights of Pacifica, some 73 hectares, and is sold out.

Presidential Estates, Quepos, 32 hectares. Sold out.

Las Brisas, 75 hectares adjacent to Heights of Pacifica. Sold out.

Punta Verde, near Quepos, 60 hectares. Sold out.

In planning:

Vista del Mar and Ocean Point, near Miramar north of the Municipalidad de Puntarenas. These, too, will be divided in heactare lots.

Jo Stuart
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