These funds scavenge from poor countries

Tuesday 28th June 2011, 3:00PM BST.

From Bernard and Françoise Carré.
WE have been very concerned to learn that a US based ‘vulture fund’, F G Hemisphere, was last year awarded a $100,000,000 judgment against the Democratic Republic of Congo.

This will come as a great sadness to the thousands of Jersey people who, for many years, have worked very hard for overseas aid and fair trade.

It must also be a disappointment to those in the finance industry who strive for Jersey to have the highest reputation. Now, the Democratic Republic of Congo has made an appeal, and there will be a ruling on this by a Jersey Court later this month. It will be crucial to the survival of millions of desperately poor people.

Vulture funds are private companies that try to scavenge profit from the debts of some of the world’s poorest countries. They seek to profiteer by buying up the debts of heavily indebted countries at a cheap price, then trying to recover the full amount, often by suing through the courts.

According to the Jubilee Debt Campaign, more than 50 companies, many based in tax havens, are known to have taken legal action against 12 of the world’s poorest countries in recent years, for claims amounting to 1.5 billion dollars.

Last year the UK Parliament, with cross-party support, passed a Debt Relief (Developing Countries) Act, which restricts the activities of these funds in British Courts. The law has already proved its worth by helping Liberia to save over 40 million dollars, after being pursued by two vulture funds for a debt dating back to the 1970s.

In May of this year, in reply to a Parliamentary question, the UK Treasury Minister, Mark Hoban, said that the UK Government would make the Debt Relief Act permanent, and that ‘the UK will share its experience (in this matter) with Britain’s Crown Dependencies and Overseas Territories’.

However, the law does not yet apply in Jersey. The Jubilee Debt Campaign is seeking support, to persuade the States of Jersey to prevent vulture funds from using Jersey courts. More information about this campaign is given in the vulture funds page at http://www.jubileedebtcampaign.org.uk.
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1
Ade

June 28, 2011 at 3:42 pm

Whilst it is admirable to forgive the debts of countries which were incurred probably to buy arms or to support the lifestyle of a despot we do not do the same to local residents in Jersey.

The Citizens advice bureau have more than once shown that debts incurred by the largesse of banks is not able to be taken into account under a social desastre. A person in Jersey cannot therefore rid himself reason of credit card debts as he is judged to be guilty

On the other hand we are expected to do the same for despotic nations!

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2
watermelon

June 28, 2011 at 4:05 pm

Great letter, fairtrade in Jersey has always seemed compromised by Jerseys positioning as a leader for corporate tax avoidance. Consuming ft chocolate whilst living off tax avoidance does not a fair world make.

Re Ade prove the corruption despot argument and pursue that individual not a government and its peoples already struggling with corporate power. The ethics of the IMF and its structural adjustment policies (purist right wing dogma) were disasters for many of the countries involved.

En desastre here is a valid issue but a separate one.

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3
Pip Clement

June 28, 2011 at 4:51 pm

I question the probity of the lawyers involved.
US domiciled funds holding junk loans that would not be enforced in their home jurisdiction coming to Jersey to get our courts to do their dirty work.
They seem to care nothing for their good name or that of the island only their personal enrichment.

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4
Mac

June 28, 2011 at 10:16 pm

Those who do not understand irony are of all people most to be pitied.

The Anglican Deanery of Jersey has a twinning link with the Anglican Church in DR Congo (yes, there is such a thing). There are a number of churches on this island whose members are quietly raising funds to try and lift people far enough out of poverty that raping your neighbour’s wife and then carving her up with a machete ceases to be a good life choice.

Meanwhile members of those selfsame churches are working in the Courts which enforce debt orders against Congolese companies, thus setting everything back not just to square one, but far worse than before.

Go figure…

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5
Jon

June 29, 2011 at 10:04 am

Ade you’re right, they’re all despotic nations so no problem in Jersey through a quirk of its Laws allowing the pursuance of debts from these nations. The fact that these nations are bankrupt and the despots have already hidden the pillaged funds in offshore centres like Jersey is of no relevance of course, Just means we get two bits of the same cherry.
Pip “coming to Jersey to get our courts to do their dirty work”.
Why yes that’s what Jersey does best. Has its own set of rules to help others avoid the rules of their own jurisdiction. Lawyers are not known for their good name, nor, despite Countrywise, is Jersey.
Mac you’re spot on. I have come across many of these holier than thou Christian types who appear to have no qualms about their own practices and ethics. Truth is their greed and need for money outweighs any other considerations. But not to worry, if you’re a true Christian, all you need do is pop down the confessional now and then and get forgiveness and absolution for any wrongs you may have done. Oh and pop a little fish on the back of the car just to let everybody know how good you really are. Kerching job done, next please.

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