Alleged Arenas Bay $4 Million Shakedown Caught On Tape

June 1, 2007
Managua, Nicaragua

After facing a long-standing legal dispute over his ocean-front property at Arenas Bay, owner Armel Gonzalez says he finally has proof of what he is up against: a Sandinista official who demanded a $4 million bribe to help "fix" the problem.

The exchange is caught on tape, which Gonzalez promptly turned over to a judge in the neighboring town of Rivas, as well as to the media. First broadcast on the popular television show, This Week, the alleged exchange takes place between Gonzalez and Gerardo Miranda, a veteran Sandinista politician who now works for the Nicaraguan consulate in Costa Rica.  

Gonzalez's ownership of Arenas Bay has been challenged by some members of a local collective, who say that a small part of the land still belongs to them. Miranda is heard on the tape as saying: "We can negotiate with $4 million dollars."

Nicaragua's attorney general plans to investigate Miranda and some Sandinista officials are calling for their colleague to resign. The problems at Arenas Bay ultimately stem from the Sandinista land confiscation policies of the 1980s.

Despite purchasing the property for several million dollars, Gonzalez says he still faces legal and political pressure from outspoken community members who want the prime beach spot to remain in their hands.

President Daniel Ortega has promised no more confiscations and claims that his government will solve the simmering land disputes once and for all. "The property problem can be solved quickly," Ortega said at meeting with foreign investors before the November elections. "We have the capacity, the will, the knowledge, and the strength to do it."

In the meantime, we remind you to be cautious when buying land, especially in more rural areas. As with any investment, do your homework. Turn to reputable groups to help with your purchase, have a lawyer check over the land title documents, and turn to a company such as First American Title Insurance Co. for title insurance.

Your Latin America Insider,

Suzan Haskins
for International Living

P.S. Nicaragua is one of the most attractive places in the world to buy property right now. But you must know what you're doing. Learn more about this diverse, relatively undiscovered country-including the safest and most lucrative places to live and invest, and how to best structure your property purchases- in Nicaragua: The Owner's Manual. Read more here.