Mexico City’s lucrative real estate scams

Property evictions in Mexico City have become a lucrative business for an extensive network of lawyers, public notaries, politicians, officials and criminal groups that expropriate homes and land to later sell at below-market prices. This fraud has become a well-oiled machine that identifies desirable real estate, studies its victims and then confiscates the property under the pretext of some legal violation. Falsified documents created and registered by corrupt officials provide a veneer of legality for the whole operation. The scheme has dispossessed thousands of people over several government administrations of various political stripes. According to data from the National Public Security System, in 2022 alone, 4,039 investigations were initiated in Mexico City for illegal dispossession.

Héctor Alonso is one of those victims. In the 1990s, Alonso’s father bought a 2.2-acre (9,065 square meters) plot of land near the beltway that circles Mexico City (Anillo Periférico), one of the busiest thoroughfares in the capital. His father, who was in the construction business, planned to build a 10-story hotel but kept delaying the project due to other priorities. After Alonso’s parents divorced in 2000, his mother kept the land in the settlement. She transferred the property to a trusteeship the following year with plans to eventually resume construction. The problems began after the project lay dormant for a decade.

Next to the Alonso property was a squatter settlement that was formalized and incorporated into the city in the 1980s. Almost 30 years later, an official in the land-tenure formalization office of the Ministry of Agrarian, Territorial and Urban Development decided to include the Alonso property in that formalization process, which involved land expropriation, and then illegally sold the property to his aunt.

Héctor Alonso, now in his sixties, was unaware of the illegal sale until he learned that the public property registry indicated two owners for the same land – his mother and someone else both had valid deeds. Alonso claims that the official who conspired to sell the property to his aunt colluded with public notaries and lawyers to register the sale with various public agencies. “First, they find a piece of land they want,” said Alonso. “Then they look it up in the property registry and say, ‘Look, it belongs to a 70-year-old lady. Well, that’s nice, but why hasn’t she developed it? She must not have the money.’” This all leads them to decide it would be easier just to expropriate the property, says Alonso.

Older people are the perfect victims. El Universal newspaper recently reported that the Mexico City Attorney General issued a report to the local legislature detailing how this real estate fraud works. The criminal network usually targets older absentee landlords who own easy-to-sell properties in high-priced areas. These were the same ingredients that motivated the recent murders of the Tirado brothers and their uncle in a two-story mansion in one of the capital’s priciest neighborhoods.

Property disputes usually turn into protracted legal battles in which the victim and victimizer spend years trying to prove ownership. Many victims abandon the case because they don’t have the time or money to fight the battle. Other victims told EL PAÍS that the fraudsters demanded money to renounce their claims over the property. Héctor Alonso says the people who stole their land wanted $268,000 (5 million pesos). “We can’t agree to extortion because it will never end. As business people, we cannot get involved in anything like this because investors in a project want everything completely above board,” said Alonso.

After a 12-year legal battle, Alonso proved in court that the land belonged to his family. The official involved was barred from holding public office for ten years and fined $2 million (37.9 million pesos), according to a document from the land-tenure formalization office (CORETT) obtained by EL PAÍS. Nevertheless, Alonso still has not recovered the land, which is still impounded by the city.

Forged signatures and unlawful contracts

María Eugenia Casillas is another victim of this type of real estate fraud. In October 2017, she was asleep in her home in Colonia Escandón when a loud noise in the early morning awakened her. Over a dozen men had broken into her house and were moving her furniture and belongings out into the street. Frightened, Casillas called her brother and asked for help before deciding to stay with some relatives for a few days.

When Casillas went to the Attorney General’s Office to find out what was happening, she learned that her house had been sold – someone had registered a sales contract with Casillas’s signature. “Either they forged her signature or tricked her and said, ‘Sign here,’” said Roberto Casillas, María Eugenia’s brother. They then began a lengthy court battle to recover the property.

The Casillas family believes that the criminal network targeted María Eugenia when the octogenarian went alone to the property registry office to submit some paperwork. “That property belonged to our family,” said Roberto. “My parents built and owned the house. When they died, they left it to us. We have a document to prove that we are the legal owners.”

When the Attorney General’s Office eventually proved that the sale had been fraudulent, they ordered the eviction of the new occupants. But the nightmare didn’t end there – the house had been resold. “The swindlers who took the house from my sister and claimed they were the owners turned around and sold it to another woman whose name is properly recorded in the property registry,” said Roberto. “They had it all organized – it’s a very well-orchestrated mafia.”

The Casillas fraud involved notaries, lawyers and public officials who colluded in registering not one but two irregular sales. “At the same time the first sale was being investigated, the house was sold again. How do you explain that?” asked Roberto. Five years later, the family still hasn’t recovered the house due to various bureaucratic obstacles. “We’re suspicious of everyone now since so much time has passed, and they haven’t given us our house back. It’s been five years, and they keep coming up with excuses.”

A sales catalog for stolen properties

Several sources told EL PAÍS about some people who created a catalog to list stolen properties for sale. Héctor Alonso told us about a beautiful, well-dressed woman who came to his construction company one day about eight years ago with an attractive proposition. She offered properties in areas where it was hard to find vacant building sites, such as the Roma or Polanco neighborhoods. “I started asking questions, and she said, ‘Look, I don’t have all the details, but if you want, we can make an appointment for the lawyers to spell it all out.’”

Alonso agreed to meet again because the properties were well below market prices. A few days later, he met with the lawyers who arrived in expensive, chauffeur-driven cars. They brought sales catalogs of all the available properties. “After a few questions, they told me, ‘We’ll get right to the point. These are abandoned lots with unpaid property taxes or owners who died without heirs. So we recover the property and do all the necessary paperwork to sell it.’” Alonso declined the offer because he didn’t want to buy land with suspect deeds. “It’s a business,” he said. “All those people make a living from this. How is it possible for them to keep doing it? How much does that cost? Who pays for it all?”