Puerto Rico’s Oversight Board has established a special committee to pursue claims stemming from a recently released debt investigation into the territory's debt.
On Aug. 20 the
A nearly 100-page section of the report laid out numerous ways Puerto Rico’s bonds and the steps that led to their issuance may have run afoul of existing laws and regulations. However, it said that there are laws that bar either private investor actions under U.S. securities law or Securities and Exchange Commission enforcement actions when more than five years have passed since the securities’ issuance.
At this point this includes nearly all Puerto Rico’s bonds except for the 2014 general obligation bond, upon which the SEC has said, after completing its own investigation, that it won’t be taking enforcement action.
Under the Puerto Rico Oversight, Management, and Economic Stability Act, “the Oversight Board, as the representative of the commonwealth and instrumentalities in Title III may pursue claims of the Title III debtors for the benefit of all creditors and parties in interest in the Title III [bankruptcy] cases,” the board stated in a written release.
The board will have the Special Claims Committee “review the debt investigation report and determine the scope of any further action to negotiate or pursue claims.”
Board members Andrew Biggs, Arthur González, Ana Matasantos, and David Skeel will be the committee’s members.
On Sept. 18 the committee will have a public hearing in Puerto Rico to give people an opportunity to talk about the report.
