With news that the Obama Administration is preparing a proposal to assist Puerto Rico with its $72 billion of debt, the Koch brothers are doubling down on their campaign to treat Puerto Rico unequally under U.S. bankruptcy code.
In a report and several posts, Bridge Project has on several occasions delved into the Koch brothers’ Puerto Rican priorities — their agenda to at all costs prevent Puerto Rico from accessing Chapter 9 protection. Why are they against it? Because, should Puerto Rico be allowed to declare bankruptcy, Koch allies stand to lose a lot of money. So they’re spending a lot of money to make sure that doesn’t happen. It’s textbook Koch Think: Never compromise your own personal profits for the betterment of others.
Big money special interests have been busy. $490,000 was spent lobbying against a House of Representatives Puerto Rican debt bill — in Q2 2015 alone, according to The Bond Buyer. And 60 Plus, “a senior’s advocacy group with connections to the Koch brothers,” ran “an anti-bill media campaign” this summer.
And with the announcement of the Obama Administration’s new plan, the Kochs are back at it. Main Street Bondholders, “a project of the 60 Plus Association,” according to the group’s website, on Tuesday forcefully pushed back against the Obama Administration’s proposal. In a press release, the Main Street Bondholders said it “denounces Puerto Rico Governor Alejandro Garcia Padilla and the Obama Administration’s plan to violate Puerto Rico’s Constitution by abandoning the Commonwealth’s debt obligations.”
Sure they’re using the guise of concerned “retirees” extremely well-versed in both bankruptcy law and the Puerto Rican constitution, but it’s Charles and David Koch who are behind this — it’s classic Koch brothers subversion. And classic Koch brothers hypocrisy: In 2002, the Kochs received a bond bailout from the Puerto Rican government — to the tune of $2.2 million. And unsatisfied with that, they took the Puerto Rico to court to get more.
But, hey, it’s the Kochs — did you expect anything less?
The Kochs Received Their Own Bond Bailout From The Puerto Rican Government In 2002 & Filed Lawsuits Seeking More Money
Kochs’ Held $2.2 Million of defaulted bonds, received government bailout
Koch Financial Owned Puerto Rican Bonds Purchased From AA Public Finance Co. And “Was Bailed Out By The Puerto Rican Government.”
Bond Buyer: “Koch Financial… Held $2.2 Million In Defaulted Bonds And Was Bailed Out By The Puerto Rican Government.” According to the Bond Buyer, “Among the buyers was Koch Financial, which held $ 2.2 million in defaulted bonds and was bailed out by the Puerto Rico government.” [Bond Buyer, 12/12/02]
- Bond Buyer: “The Leases Were Done Between Agencies Such As The Department Of Natural Resources And Department Of Education With A Company Called AA Public Finance Co.” According to the Bond Buyer, “The leases were done between agencies such as the Department of Natural Resources and Department of Education with a company called AA Public Finance Co., which is based in PuertoRico.” [Bond Buyer, 12/12/02]
- Bond Buyer: AA Public Finance “Then Securitized The Agreements And Sold Them As Nonrated Tax-Exempt Bonds In The United States” To Companies Such As Koch. According to the Bond Buyer, “The leases were done between agencies such as the Department of Natural Resources and Department of Education with a company called AA Public Finance Co., which is based in PuertoRico. The company then securitized the agreements and sold them as nonrated tax-exempt bonds in the United States. Among the buyers was Koch Financial, which held $ 2.2 million in defaulted bonds and was bailed out by the Puerto Rico government.” [Bond Buyer, 12/12/02]
- The PuertoRican Government “Bailed Out” Koch Finance Even Though They Claimed To Not Have “Direct Responsibility On This Debt.” According to the Bond Buyer, “Among the buyers was Koch Financial, which held $ 2.2 million in defaulted bonds and was bailed out by the Puerto Rico government. ‘Even though we don’t have direct responsibility on this debt we are honoring it because we don’t want to jeopardize the good faith of our investors,’ said GDB [Government Development Bank] president Hector Mendez.” [Bond Buyer, 12/12/02]
Koch Financial Had Legal Battles With Puerto Rican Government Over The AA Public Finance Bonds
June 2003: Koch Financial Corporation Filed A Breach Of Contract Complaint Against The Municipality Of Bayamon And The Government Development Bank For Puerto Rico. According to US District Court of Puerto Rico documents, on June 13, 2003, Plaintiff Koch Financial Corp. filed a complaint against Defendants The Municipality of Bayamon and the Government Development Bank for Puerto Rico, seeking $810,000. [US District Court of Puerto Rico Documents via PACER, accessed 6/30/15]
June 2004: Koch Financial Corporation Filed A Fraud And Unjust Enrichment Suit Against The Government Of Puerto Rico And AA Public Finance Co, Inc. According to US District Court of Puerto Rico documents, on June 7, 2004, Koch Financial Corp filed suit against Government of Puerto Rico/Family Umbrella Department, AA Public Finance Co, Inc., Alvin F. Aguirre, his wife, Marilyn Gonzalez, and the Conjugal Community established between them, and/or their alter ego corporations and/or trusts, including, but not limited to, Inmobiliaria AA, Inc., Cross Border Leasing Co. Inc., Limited Funding Services, The Fideicomiso Aguirre Gonzalez via its Trustee Alvin F. Aguirre, and the currently unknown corporations, trusts, or other entities fictitiously named XYZ, seeking $193,000. [US District Court of Puerto RicoDocuments via PACER, accessed 6/30/15]