Last week, the U.S. Senate Energy and Natural Resources Committee passed the “Puerto Rico Recovery Accurate in Disclosures Act” (PRRADA) with U.S. Sen. Marco Rubio, R-Fla., applauding the bill as it gains momentum.
“This bipartisan legislation would impose robust disclosure requirements on all of the Puerto Rico Financial Oversight and Management Board’s advisers and consultants, closing a loophole in existing law that currently disadvantages the people of Puerto Rico. PRRADA would require vendors to disclose potential conflicts of interests, ensuring that the people of Puerto Rico have access to the same transparency and disclosure practices required by law in U.S. mainland bankruptcy cases,” Rubio’s office noted. “In 2016, Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA) to set up an orderly bankruptcy process to restructure the island’s debts, pay off creditors, approve infrastructure projects, and stimulate economic development. At the time, the law failed to add a requirement for advisers and consultants to disclose their own conflicts of interests with the variety of creditors to whom Puerto Rico owed $123 billion.”
Over in the U.S. Senate, Rubio and U.S.Sens. Bob Menendez, D-NJ, Debbie Stabenow, D-Mich., Mazie Hirono, D-Hawaii, and Richard Blumenthal, D-Conn., are backing the proposal as it now heads to the Senate floor.
“There should be absolutely no difference between the level of transparency practiced both in the U.S. mainland and Puerto Rico,” Rubio said last week. “I’m pleased to see this important bill advance to the full Senate for consideration, so that we can fix this loophole.”
“When Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act in 2016, I was vehemently opposed because it did not do enough to protect the people of Puerto Rico during the debt restructuring process. It included an unfair loophole that let bankruptcy advisers and consultants to get rich off of worsening economic inequalities in Puerto Rico without having to disclose their conflicts of interests with creditors to whom Puerto Rico owed money,” Menendez said last week.
“I have fought alongside Congresswoman Nydia Velázquez for a long time to correct this injustice. The 3.2 million American citizens that call Puerto Rico home deserve the same transparency and disclosure practices required on the mainland. For too long they have paid the price for this lack of transparency. This legislation is long overdue. The House has already passed it twice unanimously, and today we take a key step forward in finally righting this wrong. I will not stop until it is passed in the Senate and signed into law,” Menendez added.