Vulture Fund Wins $15 million from Zambia

April 25th, 2007

Jubilee USA Debt campaign urges Congress, President Bush to Take Immediate Action

Tuesday, April 24, 2007 — Today at the UK Royal Court of Justice in London, a judge ruled that Zambia must pay $15.4 million plus a yet to be determined share of legal costs to Donegal International, a vulture fund that had sued Zambia for more than $50 million.

While Donegal was not awarded the full amount it sought, debt campaigners were outraged by the outcome as Donegal, led by American investor Michael Sheehan, purchased the debt for just $4 million.

“With this ruling, Donegal stands to make an outrageous profit out of one of the world’s most impoverished nations, winning almost half of the amount Zambia was expected to save from debt relief this year. This money should have gone to build desperately needed schools and clinics in Zambia, not to line the pockets of a wealthy American investor and his cronies,” said Neil Watkins, National Coordinator of Jubilee USA Network.

This year, Zambia expects to save about $40 million from debt relief enacted in 2006 by the IMF, World Bank, and US government.

Jubilee USA Network members and debt campaigners around the world are working to try to stop Donegal from actually getting the money, and even more importantly, to make sure the vultures don’t prey on poor countries any longer. Several Members of Congress have committed to hold hearings on the practices of these vulture funds in May.

“This must never be allowed to happen again. We are calling on President Bush to work with other world leaders at the G-8 summit this coming June in Germany to take definitive action to stop these vultures from preying on poor countries in the future,” said Watkins.

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