{"id":6780,"date":"2019-01-15T12:24:35","date_gmt":"2019-01-15T18:24:35","guid":{"rendered":"https:\/\/www.investorlawyers.com\/?p=6780"},"modified":"2022-05-19T09:58:48","modified_gmt":"2022-05-19T14:58:48","slug":"puerto-rico-oversight-board-seeks-to-invalidate-over-6-billion-of-general-obligation-bonds","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/puerto-rico-oversight-board-seeks-to-invalidate-over-6-billion-of-general-obligation-bonds\/","title":{"rendered":"Puerto Rico Oversight Board Seeks to Invalidate Over $6 Billion of General Obligation Bonds"},"content":{"rendered":"<p>\t\t\t\t<a href=\"https:\/\/oversightboard.pr.gov\/documents\/\" target=\"_blank\" rel=\"noopener noreferrer\">The Financial Oversight Management Board for Puerto Rico (the Board) <\/a>is asking a federal district court judge to invalidate over $6 Billion in general obligation (GO) bonds by disallowing any claims brought by the bonds\u2019 holders. The legal action, brought by the Board and the island\u2019s unsecured creditors\u2019 committee, focuses on GO debts that the U.S. territory sold in 2012 and 2014.<\/p>\n<p>The Board and the committee contend that the debt at issue violates Puerto Rico\u2019s Constitution, including the balanced budget clause as well as the debt service limit provision. According to <em><a href=\"https:\/\/www.usconstitution.net\/constfaq_q141.html\" target=\"_blank\" rel=\"noopener noreferrer\">Law360<\/a><\/em>, both parties claim that previous administrations of the island\u2019s government engaged in different \u201caccounting gimmicks\u201d to get around these provisions.<\/p>\n<p>For example, the petitioners maintain that bonds issued through the Puerto Rico Public Buildings Authority were an attempt to get around the 15% debt service limit when, in fact, the bonds should have been factored into that limit. If that had been done, the Board and committee are now arguing, then bonds issued after March 2012 should be rendered invalid and taken off the balance sheet of what the island owes.<\/p>\n<div class=\"read_more_link\"><a href=\"https:\/\/www.investorlawyers.com\/blog\/puerto-rico-oversight-board-seeks-to-invalidate-over-6-billion-of-general-obligation-bonds\/\"  title=\"Continue Reading Puerto Rico Oversight Board Seeks to Invalidate Over $6 Billion of General Obligation Bonds\" class=\"more-link\">Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>The Financial Oversight Management Board for Puerto Rico (the Board) is asking a federal district court judge to invalidate over $6 Billion in general obligation (GO) bonds by disallowing any claims brought by the bonds\u2019 holders. The legal action, brought by the Board and the island\u2019s unsecured creditors\u2019 committee, focuses on GO debts that the [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":430,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3762,4055,4051],"tags":[3256],"class_list":["post-6780","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-current-investigations","category-featured-investigation","category-puerto-rico-debt-crisis","tag-puerto-rico"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Puerto Rico Oversight Board Seeks to Invalidate Over $6 Billion of General Obligation Bonds &#8212; Investor Lawyers Blog &#8212; January 15, 2019<\/title>\n<meta name=\"description\" content=\"The Financial Oversight Management Board for Puerto Rico (the Board) is asking a federal district court judge to invalidate over $6 Billion in general obligation (GO) bonds by disallowing any claims brought by the bonds\u2019 holders.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/puerto-rico-oversight-board-seeks-to-invalidate-over-6-billion-of-general-obligation-bonds\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Puerto Rico Oversight Board Seeks to Invalidate Over $6 Billion of General Obligation Bonds &#8212; 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