Here's something I didn't know about. many of you will already be receiving emails from Oxfam on updates on campaigns.
One thing I didn't know you could do was buy the debts of a poor country and then sue them for the whole lot plus interest. Do you want me to say that again becuase I didn't believe it was true. Yes, companies can buy the debt of a poor country and then sue them for the amount plus a whole lot more. For example one company caled Donegal bought the debt ($3.3 million) of Zambia and then sued them for $55 million. Duh!
Good grief, no wonder they are called debt vultures.
Here's as much of the story from a markets website that I can find :
A so-called “vulture fund” won a partial victory against the impoverished African country of Zambia on Thursday. The British High Court ruled that Donegal International, based in the British Virgin Islands, had the right to receive some payments for Zambian sovereign debt that it bought at a heavy discount. The debt, originally owed by Zambia to Romania, was bought by Donegal in 1999 for less than $4m. It emerged that Donegal was seeking $55m in payment for the full value of the debt, higher than the $42m earlier thought, after a “settlement agreement” in 2003 between Donegal and Zambia. Zambia had claimed in court that the debt was invalid as there was evidence that Donegal’s local agent had bribed civil servants to pass the debt to Donegal rather than allowing Zambia to pay it off at a heavily discounted rate to Romania. Zambia ceased making payments under the settlement agreement in 2004. Issuing judgment, Mr Justice Andrew Smith rejected the contention of bribery. The judgment of how much should be paid to Donegal was postponed but Mr Justice Smith said that the full claim was unlikely to be justified.
Oxfam have info about it. The update of this campaign was on Newsnight last week. It is just stunningly shocking.
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