On a recent Saturday afternoon, "El Alerce," a Puerto Montt weekly newspaper named after the region's increasingly rare variety of sequoia tree, hit the newsstands with an alarming headline.
"Ethnic cleansing revealed in Palena" - a largely wilderness region south of Puerto Montt - the two-inch-high red letters blared.
The sensational claim stemmed from rumors that for more than two years have swirled around a wealthy American's plan to create a giant ecological reserve across a vast swath of southern Chile.
Quoting local "nationalists," the article said that Douglas Thompkins, a San Francisco entrepreneur who built a fortune from the Esprit and Patagonia clothing brands before turning to ecological interests, was evicting Chileans from his property with the intention of creating a colony for foreigners.
Noting that Mr. Thompkins is a promoter of "deep ecology" - the notion that human activity is not superior to that of other natural organisms - the article said the American opposed "the beliefs and sociological bases of the Chilean people."
The claims were nothing new for Thompkins, who over the past decade has purchased 670,000 pristine acres of fjords, lakes, rivers, mountains, and forests stretching from the Argentine border to the Pacific Ocean.
The land Thompkins owns constitutes 20 percent of Palena, one of Chile's 13 districts.
Thompkins says his intention is to create the largest privately owned park in the world, which he will eventually turn over to the Chilean national park system.
But that has not endeared Thompkins to Chileans. Even most environmentalists in Puerto Montt, where Thompkins has an office and ecological education foundation, remain skeptical of the plan. The problem, they say, is arrogance.
"Thompkins's people, his lawyers and scientists and ecologists, were all people from Santiago or farther away still, and they came in here and made it clear they knew what was best for us ignorants down here," says Jorge Patricio Manns, a Puerto Montt environmentalist. "It wasn't very good PR."
The controversy crescendoed last year when he offered to buy a piece of land from a private Chilean university that, if added to his other territory, would make him owner of a chunk of Chile effectively cutting the toothpick-slender country in half.
Rumors flew that Thompkins was planning to create a foreign colony - one incongruous claim was that it would be a new Israel, even though Thompkins is not Jewish - or was working with Argentina to undermine Chilean security, or was really planning to devastate the land for his own monetary gain.
Observers say the commotion was fed by Chilean forestry, fishing, and mining interests that were loath to see so much natural riches exempted from development.
Finally, the university declined to sell the land, but observers say that battle left Thompkins a little humbled.
"He suffered a defamation campaign from a sector of the country's business and media powers who don't like the idea that a successful businessman doesn't agree with their economic model," says Manual Baquedano, president of the Institute of Political Ecology in the capital, Santiago.