Mark is sponsoring a new bill in Parliament this week to clip the wings of vulture funds that profiteer out of Third World debt.

The Developing Country Debt (Restriction of Recovery) Bill, sponsored by Mark will be presented in Parliament by Sally Keeble MP on May 6th with all-party support.  It will outlaw profiteering by hedge funds which buy up the debts of developing country governments and then take legal action to recoup huge profits.

The bill comes against a background of a commitment by Government to take action to regulate hedge funds, and follows efforts over a long period by the Jubilee Debt Campaign to highlight the activities of the “vulture” funds.

In recent years at least 54 vulture funds are known to have taken legal action against 12 of the world’s poorest countries. Most notably the vulture fund Donegal International, based in the British Virgin Islands, won $ 15.5 million through the courts in repayment for Zambian debt it bought for $ 3.3 million.

The Bill provides for:

• An end to hedge funds and other investors buying up Third World debt at cut-rate prices and then suing developing country governments through the UK courts for the full amount.
• Reporting arrangements to the UK and developing country governments.
• Transparency over who is involved in the funds.  
• Anti-corruption measures.

Mark said:
“The vulture funds have been engaged in completely unregulated profiteering in Third World debt. This bill is a significant step forward to clipping their wings.”

Nick Deardon of Jubilee Debt Campaign also commented:
“The financial crisis is having a massive impact on people in poor countries. The idea that the people who have caused the crisis should be allowed to scavenge money that is meant to tackle poverty in the developing world is outrageous.”

[The Bill is what is known as a 10 Minute Rule Bill. These do not become laws, but they do raise awareness of an issue, enable backbench MPs to gain support from other members, and provide a platform on which an MP can build, for instance by securing a meeting with a Minister or a debate in the House of Commons.]