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Spain gets tough on property crooks

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Spain's decade long property boom has been somewhat tainted by scare stories in the press detailing tales of bribes, embezzlement and theft, orchestrated by organised criminals.

But the Spanish government is fighting back with the introduction of a zero-tolerance law enforcement policy, which, according to local reports, will manifest itself in the form of specially created forces to deal with corruption in town planning departments.

Many of the problems have come from local authorities reclassifying land as 'residential' or 'urban' and thus changing properties' position in respect to the law.

One such example is the infamous Spanish 'land grab' law, a 12-year old ruling stating that owners of private property cannot stand in the way of developments to benefit the public good. It has been a thorn in the side of many British property investors in the provinces of Alicante, Valencia and Castellion as well as their respective inland areas.

As has been widely reported in the Spanish press, those who implement the law have been put under pressure by developers through threats and bribes to open up more land for real estate, in spite of legal standing of the incumbent properties.

In a bid to protect the long-term interests of the Spanish property market, the country's centre-left government is attempting to root out corruption in local governmental institutions by creating special police units to investigate alleged legal mismanagement in real estate.

Police are already investigating dozens of cases in municipalities on the Mediterranean coast, reports Spanish Property Insight, and divisions of the Guardia Civil will begin operations in Madrid, Malaga and Murcia from January 2007.

And it appears that the Spanish authorities are already seeing the results of their new policy: a 43-year-old Austrian fraudster at the head of a large chain of criminals has been caught in Tenerife, according to local reports.

Guardia Civil's fraud squad on the island has dismantled a huge property scam, where crooks took advantage of a legal loophole to prise properties away from their true owners.

Tenerife News reports that 180 properties were affected in seven million square metres in the south of the island and had a collective value of around £2.68 million.

With the help of a German couple, the felon was brought to justice, demonstrating that cooperation between foreign investors and local authorities can often bring the desired results in such distressing situations.

Although such corruption in Spain is certainly the exception and not the rule, the authorities are becoming acutely aware of the damage that the actions of a few can have on the property market as a whole and so are whole-heartedly committing their resources to weeding out the criminality that has crept in to the thriving market.

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