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When Frank Balluff and his wife, Rebecca, purchased a lot in what seemed to be an exciting new Caribbean resort development, little could they imagine what they were getting into. In fact, it was what the Federal Trade Commission now calls the biggest real estate scam involving overseas property it has ever investigated. Promoters allegedly fleeced 1,000-plus lot buyers out of $100 million or more. Earlier this month, the FTC sought and obtained a federal court order temporarily shutting the project down and freezing promoters’ assets.
Balluff, a business owner from Michigan, estimates that his personal losses exceed $310,000, but he says he’s heard of others who “invested their full retirement funds” and planned to build homes and move to the resort. Now “they just have nothing left,” he says.
Balluff and others — mainly Americans nearing retirement age or already retired — bought into a slickly marketed development known variously as Sanctuary Belize, Sanctuary Bay and The Reserve. The 14,000-acre project is located on the Caribbean coast in Belize, an English-speaking nation bordering Mexico.
if you pay cash upfront for a to-be-developed property/neighborhood, then you should be wise enough to know that it is extremely high risk. It sucks for all the older folks who bought into this dream, but they did allow the dream to supersede some solid due diligence.
Not to mention, people really should understand that USA laws do not protect them after they cross the border and leave the USA. Caribbean real estate? Be aware, your consumer protection laws don't protect you in a foreign country. A lot of extra research is required and a local real estate lawyer to protect your interests.
( although, I do feel a lot of sympathy for retirees who were cheated)
"Through advertising pitches on Bloomberg News, Fox News and infomercials, developers promised purchasers a seductive list of amenities — fine restaurants, a luxury hotel, a world-class marina and shops, a hospital staffed by Americans, a championship golf course, a casino and even an airstrip, according to the FTC. Plus they dangled financial catnip: fat and fast profits if buyers chose to sell their parcels. The promoters pushed on-site tours to people like the Balluffs, who flew to Belize to inspect the property before putting down any money. However, according to the FTC, “many consumers” purchased lots costing $150,000 to $500,000 sight-unseen."
150k for a lot in a development with all those amenities...
You have to be careful that even a legit country that you invest in is not a banana republic that decides to go communist and take over all ownership of land and property. i would only invest in Puerto Rico or US Virgin Islands as home outside of mainland US. You should also never invest your entire nestegg in one retirement property.
Lets call it for what it is, Belize is in CENTRAL AMERICA! That region has been unstable for years (Belize was one of the better areas though). How many people sent money WITHOUT even visiting the country? Too many "Discovery Channel TV shows" are giving people false hopes about fantasy retirement areas.
Puerto Rico has its own issues (huge debt, hurricane recovery), the Bahamas or other British Territories would be less risky than Belize.
Once again the old adage holds
If its too good to be true, it usually is
Oh and as an American investor, we are not protected outside our borders for scams such as this.
Sad that many saw dollar signs and due to their greed are now left with nothing.
Wow, they actually look like plastic models of "villas" that one might find in a model train set up! All stacked in a row makes them especially look like mass produced cheap knock offs.
Nothing surprises me about wealthy Middle Easterners taste or lack thereof though.
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