The independent investigation of Puerto Rico’s $74 billion debt crisis will be a comprehensive look at the borrowing that pushed the island into its record-setting bankruptcy, according to the executive director of the island’s federal oversight board, Bloomberg News reported yesterday. The federal panel this month hired the law firm Kobre & Kim LLP to conduct a probe of Puerto Rico’s financial disclosures, how its bonds were marketed and other issues surrounding the borrowing that pushed it to the brink. “It’s going to be as broad as can be,” Natalie Jaresko, the board’s executive director, said in an interview Monday. “There’s no desire to limit it in any way. Once you’ve started down this road the only way to get credible conclusions from it is to be broad, open and inclusive.” Puerto Rico filed for bankruptcy in May after years of borrowing to cover over budget deficits. A U.S. emergency rescue law enacted last year gave the oversight board broad authority over the territory’s finances, including the power to investigate the causes of its crisis. The board is at odds with a formal committee of unsecured creditors who claim the oversight panel has delayed the investigation. Read more.
In related news, Puerto Rico, already contending with the aftermath of a storm that left as much as $1 billion of damage and hundreds of thousands still without power, faces even more upheaval with Hurricane Maria set to hit as soon as tonight, Bloomberg News reported. The government ordered rationing of basic necessities, including water and batteries, although those items were already gone from some San Juan store shelves as residents prepared for what could be the worst storm to hit the U.S. territory in decades. Read more.
For updated news and analysis of Puerto Rico's debt crisis, along with current docket filings in Puerto Rico's case, be sure to visit ABI's "Puerto Rico in Distress" webpage.
