August, 05 2020, 12:00am EDT
Ocasio-Cortez, Velazquez Call for Investigation Into Possible Martin Act Violations by New York Hedge Funds
Today, Representatives Alexandria Ocasio-Cortez and Nydia Velazquez led a letter to the New York Attorney General requesting an investigation into possible Martin Act violations by several New York-based hedge funds.
WASHINGTON
Today, Representatives Alexandria Ocasio-Cortez and Nydia Velazquez led a letter to the New York Attorney General requesting an investigation into possible Martin Act violations by several New York-based hedge funds. Recent filings in the PROMESA Title III litigation revealed that some hedge fund groups may have engaged in insider trading by artificially manipulating bond markets. Since the bonds at issue were governed by New York State law and sold and marketed within the state, this falls within the jurisdiction of the New York Attorney General's office.
"This is an opportunity to investigate and hold accountable the various financial institutions that have exploited Puerto Rico, which is facing the worst economic depression in its history, one that undoubtedly impacts New Yorkers who have historic, cultural, economic, and community ties to the island. We respectfully ask that your office initiate an investigation immediately into this potentially illicit conduct and hold accountable those who continue to seek to profit off of poverty," reads the letter.
The Martin Act is a uniquely strong tool at the sole discretion of the New York Attorney General. As defined by New York courts, the Martin Act covers "all acts" that may "deceive or mislead the purchasing public," even those without "any actual evil design or contrivance to perpetrate fraud or injury upon others."
The letter is co-signed by New York delegation members Representatives Maloney, Serrano, and Espaillat. The full letter text is available here. The letter was also supported by the Center for Popular Democracy and LatinoJustice PRLDEF.
"For too long, we've seen Wall Street hedge funds and other bad actors profit from Puerto Rico's debt, at the expense of the millions of American U.S. citizens who reside there," said Congresswoman Velazquez. "Now, it appears that some of these vulture funds were using non-public information to purchase certain classes of Puerto Rico bonds, at the same time they were participating in the debt mediation process. Not only is this another example of deep pocketed interests profiteering off Puerto Ricans' suffering, but these hedge funds may have also violated securities law. There needs to be an immediate, thorough investigation and any wrongdoing must be swiftly prosecuted."
Jesus Gonzalez, the Senior National Organizer and Strategic Partnerships Advisor at the Center for Popular Democracy, added, "The New York Attorney General Letitia James has a unique and powerful tool at her disposal to stand up for the people of Puerto Rico, including the more than one million Puerto Ricans living in New York. Credible allegations have been made that hedge funds, that have bought large portions of Puerto Rico's debt at a steep discount, may have engaged in unlawful activity to make large sums of money at the expense of the Puerto Rican people. This has meant that while Wall Street gets richer, Puerto Rico's economy continues to plummet and our communities suffer from its impact. We applaud and join the New York Congressional members in asking the New York Attorney General to open an investigation under the Martin Act: a New York State law that grants the New York Attorney General broad powers to investigate securities fraud, and has been used by previous attorneys general to police Wall Street to great effect."
"We are encouraged by the letter sent by Congresswoman Ocasio-Cortez and other Members of Congress to New York Attorney General Letitia James requesting that her office investigate numerous hedge funds for clear Martin Act violations, in order to continue profiting off of the pain of Puerto Ricans," said Senior Counsel for LatinoJustice, Natasha Lycia Ora Bannan. "For years, these hedge funds and others engaged in scrupulous and illegal practices to plunge Puerto Rico into a debt they cannot get out of, causing the greatest economic depression on the island in its history. The Puerto Rican people continue to suffer under an austerity regime as a result of the predatory practices of these hedge funds. The Attorney General should make clear that such blatantly unlawful and immoral behavior will not be tolerated by New York companies."
"PROMESA has allowed Wall Street to profit off of the suffering of Puerto Ricans. Although hedge funds have secured generous settlements and made billions off this crisis , it now appears that their greed may have driven some New York financial institutions to take illegal actions. We urge the AG to consider investigating this matter, and for Congress to abolish PROMESA now," said Congresswoman Ocasio-Cortez in a statement.
Alexandria Ocasio-Cortez is an American politician serving as the U.S. Representative for New York's 14th congressional district.
(718) 662-5970LATEST NEWS
'The Next Recession Starts Here': Trump Team Weighs Abolishing Bank Regulators
The president-elect's advisers are reportedly discussing plans to shrink or eliminate key bank watchdogs, including the Federal Deposit Insurance Corporation.
Dec 13, 2024
President-elect Donald Trump and his advisers are reportedly considering plans to weaken—or abolish altogether—top bank regulators, including the Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency.
The Wall Street Journalreported Thursday that members of Trump's transition team and the new Elon Musk-led Department of Government Efficiency have asked nominees under consideration to head the FDIC and OCC if the bank watchdogs could be eliminated and have their functions absorbed by the Treasury Department, which is set to be run by a billionaire hedge fund manager and crypto enthusiast.
"Bank executives are optimistic President-elect Donald Trump will ease a host of regulations on capital cushions and consumer protections, as well as scrutiny of consolidation in the industry," the Journal reported. "But FDIC deposit insurance is considered near sacred. Any move that threatened to undermine even the perception of deposit insurance could quickly ripple through banks and in a crisis might compound customer fears."
The Trump team's internal and fluid discussions about the fate of the key bank regulators broadly aligns with Project 2025's proposal to "merge the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Federal Reserve's non-monetary supervisory and regulatory functions."
The FDIC, which is primarily funded by bank insurance premiums, was established during the Great Depression to restore public trust in the nation's banking system, and the agency played a central role in navigating the 2023 bank failures that threatened a systemic crisis.
Observers warned that gutting the FDIC and OCC could catalyze another economic meltdown.
"The next recession starts here," tech journalist Jacob Silverman warned in response to the Journal's reporting.
Eric Rauchway, a historian of the New Deal, wrote that "even Milton Friedman appreciated the FDIC," underscoring the extreme nature of the incoming Trump administration's deregulatory ambitions.
Musk, the world's wealthiest man, is also pushing for the elimination of the Consumer Financial Protection Bureau, an agency established in the wake of the 2008 financial crisis.
The Journal noted Thursday that "Rep. Andy Barr, a Republican from Kentucky and Trump ally on the House Financial Services Committee, has backed the plan to eliminate or drastically alter the CFPB and said he wants to get rid of what he calls 'one-size-fits-all' regulation for banks."
Barr has received millions of dollars in campaign donations from the financial sector and "introduced many pieces of pro-industry legislation, including significant rollbacks of protections stemming from the 2008 financial crisis," according to the watchdog group Accountable.US.
Keep ReadingShow Less
UN Chief Warns of Israel's Syria Invasion and Land Seizures
United Nations Secretary-General António Guterres stressed the "urgent need" for Israel to "de-escalate violence on all fronts."
Dec 12, 2024
United Nations Secretary-General António Guterres said Thursday that he is "deeply concerned" by Israel's "recent and extensive violations of Syria's sovereignty and territorial integrity," including a ground invasion and airstrikes carried out by the Israel Defense Forces in the war-torn Mideastern nation.
Guterres "is particularly concerned over the hundreds of Israeli airstrikes on several locations in Syria" and has stressed the "urgent need to de-escalate violence on all fronts throughout the country," said U.N. spokesperson Stephane Dujarric.
Israel claims its invasion and bombardment of Syria—which come as the United States and Turkey have also violated Syrian sovereignty with air and ground attacks—are meant to create a security buffer along the countries' shared border in the wake of last week's fall of former Syrian President Bashar al-Assad and amid the IDF's ongoing assault on Gaza, which has killed or wounded more than 162,000 Palestinians and is the subject of an International Court of Justice genocide case.
While Israel argues that its invasion of Syria does not violate a 1974 armistice agreement between the two countries because the Assad dynasty no longer rules the neighboring nation, Dujarric said Guterres maintains that Israel must uphold its obligations under the deal, "including by ending all unauthorized presence in the area of separation and refraining from any action that would undermine the cease-fire and stability in Golan."
Israel conquered the western two-thirds of the Golan Heights in 1967 and has illegally occupied it ever since, annexing the seized lands in 1981.
Other countries including France, Russia, and Saudi Arabia have criticized Israel's invasion, while the United States defended the move.
"The Syrian army abandoned its positions in the area... which potentially creates a vacuum that could have been filled by terrorist organizations," U.S. State Department spokesperson Matthew Miller said at a press briefing earlier this week. "Israel has said that these actions are temporary to defend its borders. These are not permanent actions... We support all sides upholding the 1974 disengagement agreement."
Keep ReadingShow Less
Sanders Says 'Political Movement,' Not Murder, Is the Path to Medicare for All
"Killing people is not the way we're going to reform our healthcare system," he said. "The way we're going to reform our healthcare system is having people come together."
Dec 12, 2024
Addressing the assassination of UnitedHealthcare CEO Brian Thompson and conversations it has sparked about the country's for-profit system, longtime Medicare for All advocate Sen. Bernie Sanders on Wednesday condemned the murder and stressed that getting to universal coverage will require a movement challenging corporate money in politics.
"Look, when we talk about the healthcare crisis, in my view, and I think the view of a majority of Americans, the current system is broken, it is dysfunctional, it is cruel, and it is wildly inefficient—far too expensive," said Sanders (I-Vt.), whose position is backed up by various polls.
"The reason we have not joined virtually every other major country on Earth in guaranteeing healthcare to all people as a human right is the political power and financial power of the insurance industry and drug companies," he told Jacobin. "It will take a political revolution in this country to get Congress to say, 'You know what, we're here to represent ordinary people, to provide quality care to ordinary people as a human right,' and not to worry about the profits of insurance and drug companies."
Asked about Thompson's alleged killer—26-year-old Luigi Mangione, whose reported manifesto railed against the nation's expensive healthcare system and low life expectancy—Sanders said: "You don't kill people. It's abhorrent. I condemn it wholeheartedly. It was a terrible act. But what it did show online is that many, many people are furious at the health insurance companies who make huge profits denying them and their families the healthcare that they desperately need."
"What you're seeing, the outpouring of anger at the insurance companies, is a reflection of how people feel about the current healthcare system."
"What you're seeing, the outpouring of anger at the insurance companies, is a reflection of how people feel about the current healthcare system," he continued, noting the tens of thousands of Americans who die each year because they can't get to a doctor.
"Killing people is not the way we're going to reform our healthcare system," Sanders added. "The way we're going to reform our healthcare system is having people come together and understanding that it is the right of every American to be able to walk into a doctor's office when they need to and not have to take out their wallet."
"The way we're going to bring about the kind of fundamental changes we need in healthcare is, in fact, by a political movement which understands the government has got to represent all of us, not just the 1%," the senator told Jacobin.
The 83-year-old Vermonter, who was just reelected to what he says is likely his last six-year term, is an Independent but caucuses with Democrats and sought their presidential nomination in 2016 and 2020. He has urged the Democratic Party to recognize why some working-class voters have abandoned it since Republicans won the White House and both chambers of Congress last month. A refusal to take on insurance and drug companies and overhaul the healthcare system, he argues, is one reason.
Sanders—one of the few members of Congress who regularly talks about Medicare for All—isn't alone in suggesting that unsympathetic responses to Thompson's murder can be explained by a privatized healthcare system that fails so many people.
In addition to highlighting Sanders' interview on social media, Congressman Ro Khanna (D-Calif.) pointed out to Business Insider on Wednesday that "you've got thousands of people that are sharing their stories of frustration" in the wake of Thompson's death.
Khanna—a co-sponsor of the Medicare for All Act, led in the House of Representatives by Congressional Progressive Caucus Chair Pramila Jayapal (D-Wash.)—made the case that you can recognize those stories without accepting the assassination.
"You condemn the murder of an insurance executive who was a father of two kids," he said. "At the same time, you say there's obviously an outpouring behavior of people whose claims are being denied, and we need to reform the system."
Two other Medicare for All advocates, Reps. Maxwell Frost (D-Fla.) and Alexandria Ocasio-Cortez (D-N.Y.), also made clear to Business Insider that they oppose Thompson's murder but understand some of the responses to it.
"Of course, we don't want to see the chaos that vigilantism presents," said Ocasio-Cortez. "We also don't want to see the extreme suffering that millions of Americans confront when your life changes overnight from a horrific diagnosis, and people are led to just some of the worst, not just health events, but the worst financial events of their and their family's lives."
Sen. Elizabeth Warren (D-Mass.)—a co-sponsor of Sanders' Medicare for All Act—similarly toldHuffPost in a Tuesday interview, "The visceral response from people across this country who feel cheated, ripped off, and threatened by the vile practices of their insurance companies should be a warning to everyone in the healthcare system."
"Violence is never the answer, but people can be pushed only so far," she continued. "This is a warning that if you push people hard enough, they lose faith in the ability of their government to make change, lose faith in the ability of the people who are providing the healthcare to make change, and start to take matters into their own hands in ways that will ultimately be a threat to everyone."
After facing some criticism for those comments, Warren added Wednesday: "Violence is never the answer. Period... I should have been much clearer that there is never a justification for murder."
Keep ReadingShow Less
Most Popular