Costa Rica, like many Latin American countries, is experiencing tough economic times as the year 2020 comes to an end. Unemployment is at 25% (Our last report here was 24.4%), and many businesses have been forced to close down, of which most never to reopen. COVID-19 hit the country hard beginning in March, and lots of individuals were caught unprepared. Many people had already taken out loans from illegal loan sharks, and found themselves unable to pay even the interest on the loan. Loan sharks were also caught off-guard, unable to collect outstanding debts. Debt collection has become a hot career.

As with any unregulated business, debt collectors (Cobradores de Deudas in Spanish), can name their price, depending on how difficult they anticipate collection will be, and how rich the person they are collecting from appears. Generally, the fee is 25-50% of the value of the debt. Actually though, Costa Rican debt collectors can charge what they wish, as the money is considered “dinero perdido”, or lost money, so anything recovered is considered a blessing. The variety of techniques for debt collection ranges from persistent visits to a person’s home or work, to harassment of family members, to much more Mafioso-like methods, heretofore unknown in Costa Rica.

Who becomes a debt collector in Costa Rica? Costa Rican jails are universities for those wanting to earn their livings by shaking down their fellow citizens. Inmates discuss successful collections, and learn the exact methodology for collecting on defaulted loans. Everyone knows someone, or has heard of someone doing this work. The Costa Rica Star went looking for a Cobredor to interview, and found six possibilities, ranging from ones who just make persistent collection calls to your home or work, to those known to leave non-payers with missing fingers or smashed kneecaps. Their strategy seems to be Mafia-inspired, but everyone spoken to indicated that Cobradores were not to be toyed with.

The Star spoke with “M”, recently released from the notorious men’s prison La Reforma in San Jose. M looks the part: fully tattooed, overly-muscled, head shaved, with eyes darting protectively this way and that. He had to sit facing the door during the chat. He made sure that the distinction between a debt collector and a hit man (sicario in Spanish), was clear. He seemed to feel being a debt collector was a more noble career choice. He recounted several occasions when he had helped out single mothers, widowed grandmothers, and other women who really had nowhere else to turn. He viewed his job as one of helping, not harming people.

According to the Organismo de Investigacion Judicial (OIJ), homicide is up slightly in Costa Rica, going from 564 homicides in 2019 to 574 killings in 2020. Walter Espinoza, Director of the OIJ, reported, “Most of these cases are the result of settling of debts or avenging crimes – and most involve problems with drugs.” Espinoza said that for the first time in Costa Rican history, 60% of homicides were classified as settling of debts. There was also an increase in persons found bound, shackled, or even buried.

In Costa Rica, a hit man will kill you for 50,000-500,000 colones, and will more than likely get away with it. Younger and younger sicarios are emerging, as teenagers are less likely to be suspected, and can use the kill as their entry ticket to a coveted gang membership. 90% of both debt collection and murder for money involves guns. In 2020, Costa Rica saw 27 double murders, 2 triple murders, and one famous quintuple murder in Rincon Grande de Pavas, involving a 14-year old female, 17-year old male, and 3 adult males.

One possible cause for this underground Cobredor industry, is that Costa Rica lacks sufficient consumer protection laws.( They are HORRIBLE). Even legal debt collectors have been known to step over the line in their approach to collection.
Commented Cobredor “M”, “I don’t see much of a difference between what I do, and what the credit card companies do. We are both recovering assets, but I get to make my own hours and wear more comfortable clothes.

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