The CRF I Limited (vulture fund) admitted that it always intended to sue the National Bank and the Republic of Cuba for non-payments, Granma newspaper published today.
According to the note, in the first week of the trial corresponding to the lawsuit filed by the vulture fund CRF I Limited in the High Court of England, the declarations of witnesses revealed the elements that allow understanding Cuba’s position.
Representatives of the fund, questioned by the English barrister who is leading the defense in favor of the Banco Nacional de Cuba (BNC) and the Republic of Cuba, admitted that the lawsuit before the courts was considered as an option since they began the steps to try to collect the debt securities that are now being debated.
With this, the actions of a vulture fund can be identified. CRF sought to illegally acquire two Cuban debt securities at low prices, and to condition possible agreements with the BNC and the Republic of Cuba as the only option to avoid the claim before the English jurisdiction.
CRF also alleged it is a legitimate creditor of two debts contracted in the 80’s of the last century, while the BNC and the Cuban State maintain that the fund was not and is not a creditor of Cuba at this time.
To support their position, the plaintiffs showed as evidence the document issued by a BNC official, in which the alleged consent of the Bank and, therefore, Cuba was given for the rights as a creditor to be transferred in favor of CRF.
The Cuban official responsible for the preparation and signature of the document, the cornerstone of the vulture fund’s claim, admitted in his statement before the Court, in real-time from Havana, that he was aware that he was committing an illegal act that exceeded his powers and competences, and that, in addition, it did not comply with the legal requirements for its validity.
This witness also acknowledged that his actions were the result of a promise of a gift made by representatives of the fund.
The defense of the BNC and the Republic of Cuba explained to the judge that none of the three requirements were fulfilled, which invalidates its legal effectiveness and nullifies the consequences that would derive from its issuance.
Two former executives of the BNC and two workers who performed tasks associated with the assignment operation under discussion also gave their statements from Havana, and all of them provided elements that confirm the nullity of the document issued and the procedural violations.
Moreover, at the trial hearing it was argued that the BNC, in accordance with Cuban regulations, does not have the authority to act on behalf of the Cuban State and to express its consent to the assignment of public debt.
The president of the BNC, Joscelin Río Álvarez, questioned by the “barrister” representing the vulture fund, explained the regulated procedure and the attributions of the Bank for this type of operation.
The financial institution, which since 1997 does not act as Central Bank of the State, upon receiving the notification from a creditor that intends to assign its rights over public debt, is obliged to send it to the Ministry of Finance and Prices, and this, in turn, to the Council of Ministers, in its role as the highest body of the Government of the Republic of Cuba.
For his part, the First Deputy Minister of Finance and Prices, Vladimir Regueiro Ale, affirmed that in this case there was no such communication, which reinforces the illegal nature and lack of legal consequences of the assignment alleged by the vulture fund.
The absence of intervention of said Ministry in this alleged assignment is another important element that supports the invalidity of the rights alleged by the fund.
The arguments heard in the High Court of England show clear evidence. An economic entity attempted to illegally award itself two Cuban debts and, immediately, in the absence of agreement and approval of these acts by the BNC and Cuba, the lawsuit was filed in London.
They bought the debt at a low cost, and the amount they claim would mean, in any case, a net gain ranging between 1,200 percent and 2,000 percent of the value they paid. Sessions will continue this week, and closing arguments will be heard from the barristers on each side.
The BNC and Cuba will continue to be represented and will maintain their initial position: the plaintiff is not a creditor and never was, the note concluded.