A villa just 300 metres from a beautiful sandy beach with crystal-clear waters. The mercury hitting nearly 30 degrees, even in winter. And a relaxed job teaching English to the locals.

It would be the perfect retirement for many, including perhaps many of the victims of fugitive solicitor Michael Lynn’s notorious alleged €80m mortgage fraud.

But for Mr Lynn, 44, the dream became a reality after fleeing Ireland in 2007. It is only after his unexpected arrest this week by police in Pernambuco, Brazil, that the remarkable audacity of the life he built to avoid justice has began to seep out.

Living openly after he and his wife Brid were granted residency in Brazil and after the pair had a baby in 2012, they appeared completely unperturbed at the wreckage he had allegedly left behind in Ireland and quietly went about their business, according to neighbours.

It was only when police swooped on him at a shopping mall near his luxury villa last Thursday did he realise that the game was up. Previously, he had believed himself safe because of the lack of a extradition treaty between Ireland and Brazil – and the fact he had a Brazilian child.

He settled in the beachside city of Jaboatao dos Guararapes in the north-eastern state of Pernambuco. It is a suburb of state capital Recife, which will be one of 12 host cities in the 2014 World Cup. A region popular with tourists for its stunning beaches and warm, clear water, Mr Lynn’s home was in the Candeias neighbourhood, nestled between the Atlantic ocean and the Lagoa do Olho D’agua lagoon.

Although police sources indicated his address was a modest whitewashed bungalow rented for €1,100 (R$3,500) a month, neighbours told this newspaper that an Irishman and his family had actually been living at a luxurious pale yellow bungalow, complete with swimming pool, barbecue and patio, in the next street. One suggested he had been arrested this week while another identified him as “Mike” and recognised a photograph of Mr Lynn.

It is not uncommon in Brazil for individuals to provide the authorities with an address for correspondence which is not their main residence, with no suggestion of any wrongdoing.

A new silver Citroen Xsara Picasso sat on the drive next to a neatly trimmed lawn scattered with children”s toys. A grand wooden bench swing overlooked the lawn and a large porch and seating area undercover had a large, black metal barbecue. A large marble-style hippo was the centrepiece of the garden.

On the other side of the drive, there was an outdoor swimming pool, with wicker chairs, sunloungers and another barbecue. It was not obvious whether anyone was at home, but a dog could be seen inside the property.

Neighbours, who are overwhelmingly Brazilian, said they found their neighbour to be modest, polite and also discreet. “He would walk his dog here,” one said. “We knew he was Irish but had no idea about his past. He was just taking care of his family and teaching English.”

Mr Lynn, who practised on Capel Street in Dublin before being struck off, told police he chose to live in Pernambuco because he liked the tropical climate and the community.

A four-bedroom house in Candeias can cost up to €270,000 (R$850,000), according to Brazilian property website Zap. Like many desirable neighbourhoods in Brazil, prices per square metre have rocketed over the last few years. In the area where Mr Lynn was living, property prices have risen by almost 70 per cent since 2010.

The location is enviable not only because of the climate – it was 26 degrees this weekend despite being the middle of winter – but also because the house is just 300 metres from a beautiful sandy beach.

The Cadeias beach has crystal clear waters and, given the abundance of beautiful coastline in the area, its 3km (1.8 mile) of fine sand is rarely bothered by many sunbathers.

A short hop from there is the language school in the Piedade district where Mr Lynn made a living teaching English to Brazilian teenagers.

Located a block from the beach, the Britanic Piedade school offers English and Spanish classes for children as young as seven, but it seems Mr Lynn taught mainly teenagers. In photographs posted on the school’s website, Mr Lynn poses with groups of pupils in front of a whiteboard in a classroom.

He looks relaxed, wearing jeans and a T-shirt, and is smiling widely. In one image, he has his arms around a group of children surrounded by desks and chairs. It also shows a series of photos from St Patrick’s Day events at the school. In one, Mr Lynn appears to be reclining in a school chair, wearing lurid green trousers and a white shirt. Others show a St Patrick’s Day display and children dressed in green clothes. He appeared to be well-liked in the community and among his pupils.

After his arrest, Mr Lynn was visited by his wife at the Federal Police station where he was questioned before being transferred to Cotel prison on the outskirts of Recife, according to local press yesterday. The total capacity of the prison is 700, but there are around 2,400 inmates being held there.

A police spokesman, said: “His wife was very emotional and cried a lot. He showed no signs of anxiety.” Their next meeting is likely to be in the Cotel custody centre, where all detained inmates are taken while their case is opened.

Marcionila Teixeira, a journalist in Recife who has visited and written about the prison, said it was difficult for relatives to access those being held because there were so few staff to search them and let them in. “The place has almost 10 times the prison capacity, for example, and this is the great problem,” Mrs Teixeira said. “The conditions on that account, of course, are inhumane.”

Anyone arrested by police is initially held here before being moved to either Complexo do Curado in the west of the city or Presidio de Igarassu, north of Cotel. Photographs released by police showed Mr Lynn’s passport, the extradition papers and his Brazilian foreigners’ identification card.

“He has a Brazilian child and lived legally in Brazil, has property in his name and had no shady deals,” his lawyer, Eloy Moury, said. “He came to Brazil because of Europe”s financial crisis. He wants to stay here. “We are going to look at the process to request that he remains here.”

Mr Moury added a Brazilian judge would have to hear the case before he could be extradited but there was no date set for his appearance. Local press said the administrative process could take up to 40 days.