A billionaire from Wall Street has launched a war with Argentina.
Paul Singer, who runs $15 billion hedge fund Elliot Capital Management, has convinced a judge to hold Argentina's premier naval ship hostage as a way to force the country to pay up its bonds.
Singer has had his lawyers search worldwide for ways to collect Argentine bonds bought at fire-sale prices after the South American country’s record debt sank a decade ago.
After a complaint from the U.S. hedge fund was submitted, the flagship of Argentina’s navy, the three-masted tall ship A.R.A. Libertad, was ordered by a judge to be held in Africa. Courts in the United States and Britain have granted judgments worth $1.6 billion to the hedge fund. However the fund, and other bondholders, are still suing for billions more.
The Ghana court ordered the ship to be held in port until Argentina posts a court bond equal to its value, which could be at least $10 million. Singer would then attempt to collect the money.
The Argentine foreign ministry said the actions seem to be modern-day piracy. They believe that it not only violates international law, but Argentine President Cristina Fernandez will not bend to extortion. The ministry is stating that diplomats are working with the African government to “clarify the trickery that these unscrupulous financiers have mounted.”
In a statement, the foreign ministry revealed that Singer’s hedge fund is “based in Cayman Islands, a fiscal hideout that is a colony of Great Britain, sheltering entities that refuse to submit to the laws of any jurisdiction.” The statement also said Singer serves as the main financial backer of the American Task Force Argentina, a lobby in Washington spreading false information about Argentina.
American Task Force Argentina also fired back with a statement of its own, stating, “Argentina’s status as an international scofflaw has been well-documented.”
A spokesman for Elliot Capital Management declined to comment.
Based on reporting by the Associated Press.