Bush to act on 'vulture funds'

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President Bush has indicated that he will take measures to curb "vulture funds" in the US following Newsnight's investigation.

The Congressional Judiciary Committee is also expected to investigation into the men behind the funds.

Greg Palast reported on how speculators have been buying the debts of developing nations at reduced rates then suing for the full amounts plus interest - undermining international debt relief efforts.

The high Court in London recently ruled Zambia would have to pay millions to one such company featured in Newsnight's report.

Foreign Corrupt Practices Act

In the US, a rebroadcast of Newsnight's film was seen by Congressman John Conyers - Chair of the House Judiciary Committee - before he met President Bush at the White House.

Speaking to broadcaster Democracy Now!, Congressman Conyers outlined the president's reaction to Newsnight's investigation.

"His response was, 'I didn't know anything about this.' And he assigned a staffer to get on it right away. And so, it's our position that the Foreign Corrupt Practices Act and the Comity Doctrine brought from our Constitution allows the President to require the courts defer in individual suits against foreign nations. And so, we're conducting a couple of things.

"First of all, we want to know where these practices are going on at the present time, and, two, how we can get this information to President Bush so that he can, as he indicated to us, stop it immediately."

'Dishonest'

Greg Palast 'doorstepped' Michael Sheehan Most computers will open PDF documents automatically, but you may need to download Adobe Acrobat Reader.
In Zambia's case, the High Court ruled the country will have to pay several million dollars to a Donegal International, which bought the country's debt as it was about to be written off - a more than tenfold profit for the vulture fund.

Justice Andrew Smith made it clear that he was not making the ruling on moral grounds but on strict interpretation of the law.

He said that the man behind the vulture fund - Michael Sheehan - was dishonest and had misled the courts in three countries.

Michael Sheehan - who uses a domain called Goldfinger and who was "doorstepped" in the Newsnight report - had hoped to claim $42 million plus $13 million interest for the firm Donegal International.

Justice Smith struck out some of the payments as penal but has ordered Zambia to pay around $20 million.

Meirion Jones produced Greg Palast's report on vulture funds.

RELATED INTERNET LINKS
Oxfam's vulture fund campaign
Democracy Now!
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