Anyone heard of this Border zone law?

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Yes

The issue was that Ticos were buying up land on the north side of the Rio San Juan and a law was passed to create a "Tico-free" buffer zone. I wasn't aware, however, that it restricted purchase by a legal Nicaraguan resident. I would also assume (but don't know for sure -- I didn't read the law) that a Nicaraguan corporation (S.A.) could purchase the land.

The law is called "Ley de Régimen Jurídico de Fronteras". You can find it here.

Timely Post

with all the renewed interest in this area.

Could the land have been flipped to a Nicaraguan and some money recovered?