Attac Jersey is a Member of the International Tax Justice Network. We are Members of the Association for the Taxation of financial Transactions for the Benefit of Citizens, (ATTAC) and the Tax Justice Network, (TJN). The aims of both organisations are to research, educate and campaign to further public awareness. We are seeking to alleviate poverty through the creation of just taxation systems to fund social goods.
An official inquiry has been launched into Jersey’s role in forcing third world countries to pay millions of pounds in crippling debt.
Chief Minister Terry Le Sueur has revealed that senior law officers, top-ranking civil servants and finance experts have met to look at whether so-called vulture funds should be allowed to use Jersey courts to chase debts.
The funds buy up the debts of developing countries for a fraction of the amount owed and then aggressively pursue the debtors though the courts to recover as much as possible. Some of the debts date back to the 1980s, with nations having already paid back the original figure borrowed several times over.
In the past few weeks pressure has been mounting in Jersey to review the actions of the Royal Court after the UK clamped down on vulture funds.
Campaigners from the UK lobby group, Jubilee Debt Campaign, are now calling on supporters to write to the States demanding action.
In Jersey the issue is being championed by Deputy Daniel Wimberley, who is concerned about a serious risk of major damage to the reputation of the finance industry if the Royal Court is used in this way. He said that the whole thing was ’obscene’.
Wimberley's comments follow a judgment in which the Royal Court found in favour of FG Hemisphere and ordered that the Democratic Republic of Congo pay a debt of $110m. The case is now in the appeal courts, and judgment is expected later this month.
A statement released by the Chief Minister’s department said that the government was aware that the UK wanted to stop vulture funds extracting "harsh and inequitable payments from poor countries for debts that have, in many cases, been bought for a fraction of the cost."
The UK has made permanent a temporary law enacted last year which limited the amount a fund could claw back. The Chief Minister’s statement said that Jersey had been waiting to see what action the UK took before deciding what to do. The Jersey working party hoped soon to submit proposals for consultation.