Fraudulent Transactions Detection in Costa Rica: Understanding Law 9602 and its Regulations

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The recent “Motherland” case has brought attention to the issue of fraudulent transactions in Costa Rica’s real estate market. As we delve into the legal aspects surrounding this issue, it becomes clear that Law 9602 and its regulations play a crucial role in protecting against such crimes.

Background on Law 9602

Law 9602 was enacted in August 2018 to address “irregular extra-registration situations” in real estate transactions. Article 1 of the law defines these situations as “non-existent”. A year later, Executive Decree 41959 outlined procedures for the correct implementation of this law, prioritizing transparency and legal security in property deals.

Verification Mechanisms

To safeguard legitimate owners’ rights against possible registration simulations, verification mechanisms were created to detect and reverse fraudulent registration entries made in an adulterated manner. This is vital to maintain the credibility of the registration system.

Consequences of Fraudulent Transfers

If a fraudulent transfer is detected, Law 9602 offers several ways to act:

• Filing a complaint with the National Registry
• Judicial action
• Taking precautionary measures to protect rights during the legal process

Moreover, the law requires periodic audits by the National Registry to identify possible anomalies and promote transparency in real estate transactions.

Challenges and Opportunities for Improvement

Although this legislation represents significant progress, challenges remain that must be addressed to improve protection against registry fraud. These include:

• The need for greater training among notaries and National Registry officials on fraud detection techniques
• Promoting the complete digitization of records and the implementation of advanced technologies like digital signatures and blockchain

Conclusion

In conclusion, Law 9602 represents a significant advance for property rights protection in Costa Rica by providing clear and effective mechanisms against fraudulent registration transfers. The Madre Patria case serves as a reminder of the importance of these laws and the need to continually improve their implementation, leveraging technological advancements to ensure the integrity of the registration system.

Recommendations

To further improve the effectiveness of Law 9602, we recommend:

• Strengthening training programs for notaries and National Registry officials on fraud detection techniques
• Implementing advanced technologies like digital signatures and blockchain to enhance security and transparency in real estate transactions
• Conducting regular audits and monitoring transactions to identify potential anomalies
• Promoting public awareness of the importance of verifying property ownership and transactions to prevent fraudulent activities.