The rolling surf of the Pacific Ocean crashes onto white sand beaches below a lush hillside in southwest Nicaragua, a picture of tropical paradise by anyone's definition.
These days, paradise is for sale. Contact the seller, Rep. Jerry Weller (R-Ill.).
Weller, a southwest suburban congressman with a fondness for Latin America, has sunk a large share of his investment capital into a land development in Nicaragua. But he didn't declare the extent of his holdings on his required congressional disclosures, and he indicated dramatically different purchase prices for the land in American and Nicaraguan records.
In 2002 Weller made his first official congressional trip to Nicaragua. Before the year was over, he had bought his first lot and eventually began looking for land he could subdivide into parcels that would attract buyers looking for prime ocean-view property at a relatively low price. It is an unusual investment for a member of Congress, and Weller's foreign land holdings seem far more extensive than any other House member's.
His investment got a boost from the narrowly passed Central America Free Trade Agreement, which Weller pitched in 2005 as a tool to enable businesses in his hard-pressed district to sell tractors and food to Latin America. CAFTA also includes additional legal protection for American investors, including those who have purchased lots from Weller.
What he didn't say was that, while he publicly pushed CAFTA, Weller privately was pursuing his land development, some 2,000 miles away. The House approved the trade pact in July 2005 by only two votes, 217-215.
Besides not mentioning his Nicaraguan investments during the CAFTA debate on the House floor, Weller did not give anywhere close to a complete accounting of them in his required 2005 financial disclosure statement. House ethics rules require representatives to disclose all property they own except for their personal residences.
The congressman listed only one Nicaraguan property purchase on his 2005 disclosure form, but property records in Nicaragua show that he bought or sold at least eight pieces of land.
That's not the only discrepancy. On at least two occasions, Weller has reported a land sale on his House ethics form and reported a much lower price for the same sale on Nicaraguan property records. Nicaragua's Pacific Coast was a prime spot for real estate bargains in the late 1990s and early 2000s, but buyers also frequently listed artificially low prices to lessen the bite of local taxes.
For example, Weller's first disclosed purchase in the coastal town of San Juan del Sur appeared on his 2002 financial filing, listing a lot with a purchase price of between $50,001 and $100,000. But in property records at the Registrar's office in Rivas, the department seat for San Juan, Weller is reported paying 78,000 cordobas, or about $4,333, for four-tenths of an acre in a transaction on Dec. 7, 2002.
Records indicate that Weller sold the same property in February 2005 for about $95,000. That sale does not appear on Weller's 2005 House disclosure.
When asked about the discrepancies, Weller's office first insisted that questions be given to the congressman in writing. After a week passed with no response to the written questions, The Tribune requested to talk to Weller in person. On Thursday afternoon, Weller's spokesman said he would not answer questions and had no comment.
The congressman missed all recorded House votes in Washington this week. His spokesman said he was out of the city, caring for his 1-year-old daughter.
Uneasy fit within GOP caucus
Weller's emergence as a real estate developer near the booming beach resort just north of the Costa Rican border is another step in the political and personal migration by the one-time University of Illinois agriculture major who grew up on a hog farm.
Elected to Congress as part of the Republican landslide in 1994, Weller has been an uneasy fit within the Republican caucus. He has lost numerous intraparty races for leadership posts, and has never achieved the high profile he hoped for when he arrived in Washington.
Increasingly, Weller has focused on international issues, notably in Latin America, a region that has come to dominate his personal life and his private business dealings.
In January 2002, Weller made his first government-paid trip to the region, including a stop in Nicaragua to attend the inauguration of newly elected President Enrique Bolanos. In November 2004, Weller married Zury Rios Sosa, a member of the Guatemalan Congress and the daughter of Efrain Rios Montt, a general who ruled Guatemala in 1982-83, at the height of a brutal, nearly four-decade civil war during which an estimated 200,000 people were killed.
Between 2003 and 2006, Weller served on the Western Hemisphere subcommittee of the International Relations Committee and quietly made himself into a go-to guy for interests seeking a conservative advocate on Latin American issues in the Republican-controlled House.
Cass Ballenger, a retired North Carolina Republican representative, claimed credit in a recent interview for helping to guide Weller's career.
Ballenger, who headed the Western Hemisphere panel, said he told Weller, "If you want to get on some codels [taxpayer-funded overseas congressional travel] you ought to get on this committee. It's something legal where you can live like a king."
Along the way, Weller became interested in the prospects for land investments in Latin America. Wilfredo Lopez, who sold Weller some properties in Nicaragua, said Weller told him that he enjoyed vacationing in San Juan del Sur and that he was looking to maybe invest in some land.
"He liked the area, how calm it was. He wanted to experiment by investing," Lopez said.
Property investments in other countries are perceived not only as riskier financially than in the U.S., but also politically problematic for elected officials because of the potential entanglement of private money and public policy.
In Nicaragua, much of Weller's energy and money have been poured into a roughly 12-acre development above Playa Coco, a pristine white sand beach 11 miles south of San Juan del Sur in a development named Ladera, Spanish for "ladder" or "slope."
Weller's constituents would have to look hard to find signs of any of his interest in Latin America.
In a nod to the changing demographics of his district, Weller's congressional Web site includes a welcome in Spanish, but it contains few mentions of either Nicaragua or Guatemala except for an announcement of Weller's engagement and a pair of press releases hailing CAFTA as "a big win" for Illinois farmers and manufacturers.
Since his wedding, Weller has omitted his wife's finances from his annual personal financial disclosure form, which calls for the inclusion of spousal assets.
In a May 14, 2007, letter to the House Committee on Standards of Official Conduct, Weller said he and Zury Rios de Weller meet a three-part test for exempting a summary of her finances from his disclosure. Members may claim the exemption without the formal approval of committee staff, by certifying that they have no knowledge of their spouses' finances, they don't contribute to them in any way and they do not -- and do not expect to -- benefit from them. Only one other House member, Rep. David Wu (D-Ore.) appears to have claimed the exemption in 2006.
"I am aware that my wife may possess assets in her native Guatemala. However, I do not know what those assets are, nor have I inquired," Weller said in the letter, adding that the couple does not contribute to each other's finances.
The prominence of Rios de Weller's family extends to her uncle, Mario Rios Montt, a Catholic bishop who has headed the church's human-rights office in Guatemala, and her brother, Enrique Rios Sosa, who was Guatemalan army chief of staff until 2003, when he came under investigation for embezzlement.
Land sales hard to detect
John Pavich, Weller's Democratic opponent in 2006, tried making the Republican congressman's involvements in Central America a campaign issue, but voters sent Weller back for another term.
"He's helping write the laws where he has investment holdings and where his wife's family has investments" and heavy political involvement, Pavich said in a recent interview.
The Pavich campaign wanted to know if Weller was receiving campaign contributions from interests with ties to Zury Rios de Weller's family, but "without seeing her financial holdings, that was just impossible," Pavich said.
Also difficult to detect was that Weller had been buying and selling property like a speculator or a developer, not merely accumulating relatively modest holdings, as his 2005 financial disclosure filing indicates.
Until May of this year, when the House released 2006 disclosure reports, Weller's filings have given little indication of the scope of his activity in Nicaragua.
His 2005 filing, for example, listed his holdings merely as "Lot 1," "Lot 2" and "Lot 3" in San Juan del Sur, with a total value of between $200,000 and $450,000.
One of the buyers of Lot 1, Mardi Mastain, said she bought the property, on a bluff overlooking the Pacific, through a local broker.
"A lot of people register the property at a lower price" to lessen the bite of the transfer tax, which at the time was 4 percent of the sale price, said Mastain, who splits her time between Oregon and San Juan del Sur, where she manages real estate. "We registered it for the exact price we paid."
In his 2004 disclosure, Weller listed the sale of a Capitol Hill condo for between $250,001 and $500,000 on April 8 and three days later reported buying Lot 2 in San Juan for between $50,001 and $100,000.
Property records in Rivas show Weller bought the 2.6-acre parcel at Playa Coco for 50,000 cordobas, or about $2,777.
Last October, the Chicago Reader identified three properties that Weller bought or sold in 2005 without disclosing.
But a review of records in Nicaragua indicates Weller's activity that year was far more extensive. In the first four months of the year, he made a sale to Mastain and bought a 1.9-acre plot at Playa Coco for $2,777 and a 1,200-square-meter lot in a neighboring development for $555. In June in partnership with two others, he paid $45,000 for more land at Playa Coco, and later that month sold a lot at Playa Coco for $1,666.
In August, he sold another lot at Playa Coco for the same price; in September, he sold two more lots at Playa Coco for $1,666 apiece; and in December, in partnership with two other men, bought 4.9 acres at Playa Coco for $174,043. Weller is listed as having a 50 percent interest.
Only the Dec. 10 acquisition, listed as being worth between $50,001 and $100,000, is cited in Weller's 2005 disclosure report. The December transaction occurred one day after Weller sold a parking spot for a downtown Chicago condominium for $38,000.
Weller made a much more detailed disclosure in his 2006 report filed this past May and provided a glimpse of just how potentially profitable the Ladera development has become. In this disclosure, he reported consolidating three lots and subdividing them into 37 parcels. Weller listed selling 11 of them for between $275,008 and $700,000, indicating that he already may have recouped the cost of his investment -- with 26 lots left to be sold.
The Tribune was able to identify nine lots sold by Weller in 2006 for $346,000, based on property records and interviews.
But Weller's report still doesn't account for the sale of land to Mastain or the bulk of his 2005 transactions.
Razing of land under fire
The development itself has also been controversial, with some local officials and rival developers contending that Weller's razing of vegetation on the land left it damaged environmentally and vulnerable to mudslides.
Manuel Rodriguez, regional delegate for the country's Ministry of the Environment and Natural Resources, said officials plan to inspect the Ladera development and other properties out of concern that they were approved without complying with environmental laws.
Weller is represented in Nicaragua by William Hays, a Canadian resident of San Juan del Sur, who describes himself as a friend of the Republican congressman. "I administer his project," Hays said in telephone interview.
Hays said the Weller project is "definitely not profitable," in part because of high infrastructure costs for bringing water, electricity and paved roads to the remote area. "It's just astronomical the bills that are coming in," he said.
Hays said the once-sizzling real estate market in San Juan del Sur has cooled, thanks in part to a downturn in the U.S. housing market and in part to worry by foreign investors about the approach of newly elected President Daniel Ortega, whose Sandinista party adopted socialist policies when it ruled Nicaragua during the 1980s.
Like many other members of Congress across the political spectrum, Weller spoke out against Ortega prior to the November 2006 presidential election in Nicaragua.
He also was an outspoken advocate for CAFTA, which among other things improves conditions for investors in Nicaragua, according to a report by the Office of the U.S. Trade Representative.
"[CAFTA] establishes a more secure and predictable legal framework for U.S. investors operating in Nicaragua. ... U.S. investors will enjoy in almost all circumstances the right to establish, acquire and operate investments in Nicaragua on an equal footing with local investors," the office said in its 2007 summary of the agreement.
Weller's status as an American lawmaker was a selling point in at least one transaction, according to David Steinhaus, of Boise, Idaho, who bought two lots from Weller in February 2006 for about $70,000 -- and is now trying to get out of the purchase.
"They were kind of bragging about it," Steinhaus said of the salesmen who pitched him the Weller property. "[They said] 'This is being developed by U.S. Congressman Jerry Weller. He's on the Ways and Means Committee. It should be a clean deal."
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Rep. Jerry Weller appears to boast the most extensive foreign real estate holdings of any House member, according to 2006 financial disclosure forms. Here are some other members who own property abroad:
*Rep. Jane Harman (D-Calif.) owns a share in an investment firm with properties in France, Germany, Italy, Spain and Argentina.
*Rep. Tom Lantos (D-Calif.) owns an apartment complex in Vancouver, British Columbia.
*Rep. Peter DeFazio (D-Ore.) owns two rental properties in New Zealand.
*Rep. John Yarmuth (D-Ky.) owns an apartment unit above the clubhouse of a recently built golf course on Ireland's west coast; he rents it out for most of the year.
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