New legislation will clamp down on 'vulture funds'

Thu, 13 Dec 2012

New legislation to prevent the Island from being used to exploit poor countries has received Royal Assent.

The Heavily Indebted Poor Countries Act 2012 has outlawed the practice of 'vulture funds' which undermine international debt relief efforts.

The legislation will stop vulture funds buying up the debt of a poor nation for a fraction of its original amount and then using the courts to sue for the full value plus interest.

The IMF Fund and the World Bank estimate that vulture funds are seeking claims of 1.47 billion dollars from countries including Cameroon, Ethiopia and Uganda.

Treasury Minister Eddie Teare says there is no evidence that this activity is taking place on the Island but that it will rule it out from happening in the future.