Court Win For Vulture Funds

The U.S. Supreme Court declined to hear an appeal on June 16 from Argentina of an order to pay a so-called vulture fund $1 billion. That decision lets two lower federal court rulings stand, and Argentina now must turn over information about its U.S. bank holdings. Eric LeCompte, executive director of Jubilee USA, said that because of this decision it is now open season on the assets of other heavily indebted poor countries. “It has incredible impacts in terms of how the financial system operates, how poor countries have the ability to become middle income countries,” he said. LeCompte fears that the floodgates could open for other hedge funds to recover the assets of defaulting countries, to the detriment of poor citizens. “A small group of hedge funds—less than 100 engage in this predatory behavior—are the winners. The losers are most of us. The U.S. government, the International Monetary Fund, legitimate Wall Street investors who supported Argentina and any poor country that would qualify for debt relief are the losers.”