The Federal Trade Commission and U.S. Attorneys in Maryland temporarily shut down an alleged $100 million real estate scam in Belize, the FTC announced Thursday.
The FTC said the scheme was the largest real estate fraud the agency has uncovered in its history.
The “Sanctuary Belize” development drew investors from across the United States to buy at least 1,000 lots in the Central American country, where they could build their dream retirement homes in a community developed with every conceivable luxury amenity, including an American-staffed hospital, “world-class” arena and an international airport. Investors were told their lots would double or triple in value in two or three years. Convicted felon Andris Pukke, an American who also used the aliases Marc Romeo and Andy Storm, placed ads on Fox News to attract retirees, according to the FTC.
But only about 10 percent of the lots bought by investors over more than 15 years were ever developed. During those years Pukke was even indicted and served prison time in connection with a separate get-out-of-debt scheme. The FTC alleges Pukke continued to direct the Belize fraud from jail, despite assurances from his cohorts to investors that Pukke was no longer involved.
“Instead of getting their dream home buyers found themselves in a nightmare,” said James Kohm, the assistant director of FTC’s enforcement division, who called Pukke a “hardcore recidivist scammer.”
(Promotional video for Sanctuary Belize)
Prosecutors believe the Sanctuary Belize developers are about half a billion dollars short of the capital they would have needed to complete the development. They regularly pitched a “no debt” financing model to potential buyers, which ultimately meant the project was low on liquidity, especially since Pukke is alleged to have siphoned off money from his investors to pay off a loan connected to his bail and finance a personal home in California. The government says Pukke lives in Newport Beach, California.
In addition to Pukke, more than 25 other people and entities are named in the new civil complaint, including Sanctuary Belize principal Luke Chadwick and Atlantic International Bank, a Belize-based institution, which the FTC said is the first foreign bank it has ever brought an action against.
The FTC created an undercover sting operation, it said Thursday, forming a fake company that it used to get information from those directly involved in the scheme.
Pukke could not be reached by phone.