Largest real estate fraud on the Balearic Islands: 235 victims in court

At the Provincial Court of the Balearic Islands, the trial against a construction network is under way, accused of collecting down payments in the millions for apartments that were never built between 2010 and 2018. For many victims, it began a years-long nightmare.

Trial in Palma: When will paper finally become reality?

I stood on a fresh morning in front of the Provincial Court, on Avenida Alemania, and the air smelled of strong coffee and autumn rain. Inside, a case has been ongoing since June, which here in the office is described as one of the island's biggest fraud cases: 235 people are said to have fallen for a real estate scam.

What the Prosecutor's Office accuses

Between 2010 and 2018, customers at a company named Lujo Casa are said to have paid down payments totaling around 3.3 million euros for apartments that only existed on paper. The prosecution sees an organized system in the affair. Its core accusation: sales of phantom properties, false promises about plots of land and building permits that never existed.

The defendant and the flight

At the center is a man whom many in the neighborhood simply call “Charly”. The prosecutor seeks a prison sentence of up to 16 years. When the case came to light in 2018, he is said to have fled to Colombia. Two years later he was arrested there and extradited to Spain. After four years in pre-trial detention, he is currently at large.

Victims, evidence, bank errors

So far, around 87 witnesses have testified. For many, the sequence was the same: handshake, preliminary contract, down payment – and then the discomfort when the promised construction fleet did not appear on the plans. Some affected people said they had called the town hall—and learned that no building permits had been applied for or issued there.

A small bright spot: For about one hundred victims, courts have declared mortgage loans for non-existent apartments null and void. The judges see faults in the banks: lending institutions apparently issued loans too lightly and violated their due diligence.

Co-defendants and further developments

Alongside the main defendant, five more people stand trial, including a German-Italian businessman to whom a leading role is attributed. The defendants deny much and shift responsibility onto each other.

More trial days are scheduled for the end of September. Then the main defendant will also have the opportunity to speak at length. For many victims, the question remains: Will they ever find peace again – and their money?

I will monitor this. Not out of sensationalism, but because I believe many households on the island have lost their savings here. And, as they say in court, that hurts longer than a bad building plan.