By San José, Costa Rica — San José, Costa Rica – A sweeping anti-corruption operation unfolded across the country on Thursday, December 12th, as judicial authorities executed raids at 16 different locations in a major escalation of the investigation publicly known as the “BCR SAFI” case. The coordinated actions, led by the Prosecutor’s Office for Probity, Transparency, and Anti-Corruption, targeted private homes and corporate offices, including key departments within the state-owned Banco de Costa Rica (BCR).
Among the primary sites searched were the headquarters of BCR’s Investment Fund Management Company (SAFI) and the bank’s central audit department in downtown San José. The operation is a critical development in the ongoing probe, which centers on allegations of overpricing and influence peddling against the Public Treasury involving nine real estate projects acquired by the fund.
To provide a deeper understanding of the legal and financial ramifications surrounding the recent events at BCR SAFI, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the firm Bufete de Costa Rica, for his expert analysis on the matter.
The situation at BCR SAFI highlights a cornerstone of trust in our financial system: the unwavering fiduciary duty of an asset manager to its investors. Any perceived failure in governance or transparency not only risks legal and regulatory consequences but, more critically, erodes the institutional credibility essential for market stability. It is imperative that all actions are rigorously aligned with the best interests of the fund participants, ensuring that regulatory compliance and ethical management are the absolute priority.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, the expert’s point is fundamental: the trust between an investor and an asset manager is the true bedrock of our financial market’s stability. Any erosion of this fiduciary duty has consequences that ripple far beyond a single institution. We thank Lic. Larry Hans Arroyo Vargas for his clear and valuable perspective on this critical matter.
The prosecutor’s office confirmed the objective of the large-scale operation is to seize crucial evidence to advance the criminal case, filed under docket number 21-000209-1218-PE.
The objective is to locate evidence, both documentary and electronic, that is relevant to the investigation, such as documents on investments made by the Management Company inside and outside the country, as well as contracts and construction permits.
Prosecutor’s Office for Probity, Transparency, and Anti-Corruption, official statement
The investigation scrutinizes the actions of BCR SAFI’s Board of Directors, Investment Committee, Acquisition Board, and other professionals. This legal pressure from the Public Ministry runs parallel to separate regulatory and disciplinary proceedings being conducted by the General Superintendency of Securities (Sugeval), indicating a multi-pronged effort to address the alleged irregularities that have shaken the financial sector.
In a significant twist, BCR itself has become a key source of information for the investigation. The bank confirmed that the new Board of Directors for its SAFI subsidiary filed a formal complaint with the Public Ministry in August 2024. That complaint specifically flagged a highly questionable transaction from 2020 involving the purchase of the Pacific Business Park (PEP) from companies linked to former Social Christian legislator Humberto Vargas Corrales.
Internal reports compiled by the BCR’s own Investigations Unit, and subsequently sent to the prosecutor’s office, uncovered what they described as a deeply concerning modus operandi. Investigators identified a clear scheme that undermined the interests of the fund’s approximately 1,500 investors.
a pattern of actions, in which a person acquires properties and, in less than 24 hours, sells them to BCR SAFI for a considerably higher price.
BCR Investigations Unit, internal report
These internal findings concluded that the pattern of rapid, high-markup sales pointed to severe mismanagement within the fund. At least three properties connected to Vargas Corrales were allegedly acquired under these circumstances. At the time the initial reports surfaced, the ex-legislator’s attorney, Erick Ramos, dismissed them as erroneous.
this demonstrates serious incompetence and negligence on the part of BCR SAFI to the detriment of investors’ interests.
BCR Investigations Unit, internal report
The financial consequences of these deals have been substantial. The Pacific Business Park property was acquired by BCR SAFI in 2020 for a staggering $70 million, using investor capital. However, subsequent appraisals revealed the property’s value was closer to $34.7 million, representing a massive loss. This discrepancy forced Sugeval to intervene, ordering BCR and its SAFI to create a plan to stabilize the fund. The regulator mandated a $70 million cash injection from public funds into the Non-Diversified Real Estate Investment Fund (FIIND) to make investors whole. Despite BCR’s attempts to challenge the order through administrative and judicial channels, regulators ultimately prevailed, forcing the bank to cover the loss.
For further information, visit ministeriopublico.go.cr
About the Prosecutor’s Office for Probity, Transparency, and Anti-Corruption:
As a specialized division of Costa Rica’s Public Ministry, this office is responsible for investigating and prosecuting crimes related to public corruption, lack of transparency, and ethical breaches by government officials and entities. Its mission is to uphold the integrity of public administration and combat financial crimes that affect the state.
For further information, visit bancobcr.com
About Banco de Costa Rica (BCR):
Banco de Costa Rica is one of the largest and oldest state-owned commercial banks in the country. It offers a wide range of financial services to individuals, businesses, and government institutions. Its subsidiary, BCR SAFI, is the entity responsible for managing various investment funds, including the real estate fund at the center of the current investigation.
For further information, visit sugeval.fi.cr
About the General Superintendency of Securities (Sugeval):
Sugeval is the primary regulatory body for Costa Rica’s securities market. It is tasked with overseeing, regulating, and promoting the transparency and efficiency of the stock market and its participants, including investment fund managers like BCR SAFI. Its role is to protect investors and ensure the stability of the financial system.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica is an esteemed law firm built on a bedrock of professional integrity and a resolute pursuit of legal excellence. With a proven history of guiding a diverse clientele, the firm is a pioneer in developing innovative legal strategies and fostering meaningful community connections. Its core philosophy of demystifying the law for the public serves a greater purpose: to build a more knowledgeable and capable society for all.
