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Puerto Rico Debt Vultures Give Big to Candidates to Influence Fiscal Board Picks

While Biden has received far more than Trump, McConnell significantly surpassed Pelosi in donations from debt vultures.

A protester holds a flag during a demonstration calling for the closure of the airport due to the COVID-19 spike in San Juan, Puerto Rico, on August 9, 2020.

The vulture funds profiting off of Puerto Rico’s debt crisis, and the law firms that represent them, are donating to the political campaigns of the presidential candidates and key players in Congress who are involved in the selection of the members of the oversight board.

A review of the reports submitted by these candidates’ campaign committees to the Federal Election Commission shows that the vulture funds and their attorneys have donated just over $1.4 million to these candidates. These donations could influence key elected officials as they decide who the new members of the oversight board will be.

After serving for four years, one more year than what is established by PROMESA, three members of the oversight board, Carlos García, José Ramón González, and José Carrión III, resigned. In addition to these three vacancies, the terms of the members who still remain would have to be renewed, since PROMESA establishes that the terms have a duration of three years and require renewal once that period is completed.

Thus, the oversight board is in a transitional period, characterized by uncertainty about who its next members will be, the results of the elections, both federal and local, and the ravages of the coronavirus pandemic.

President Trump has the power to appoint new members of the oversight board before the general election in November. However, the presidential race between Trump and Biden will determine what type of executive branch the new board members will have to deal with over the next four years. For this reason, we also review donations to the Biden campaign.

The oversight board is made up of seven members. While the appointment of these members ultimately rests with the president, six of the members come from lists drawn up in Congress. According to PROMESA, the members of the board are elected as follows:

  1. Two members of the lists presented by the Speaker of the House of Representatives, Nancy Pelosi.
  2. Two members of the list presented by Senate Majority Leader Mitch McConnell.
  3. A member of the list put forward by House Minority Leader Kevin McCarthy.
  4. A member of the list presented by Senate Minority Leader Chuck Schumer.
  5. A member chosen directly by the president.


We reviewed FEC reports from the Trump, Biden, Pelosi, Schumer, McConnell, and McCarthy committees from 2019 to present. The reports show that twelve vulture funds and nine law firms involved in the bankruptcy of the Puerto Rico government have been donating to the campaigns. These vultures are the ones that are still active in the bankruptcy proceedings.

Companies do not make donations directly. Most of the donations come from the employees, executives or owners of these firms. The following table shows the donations received by key politicians with power to reorganize the oversight board.

2019-2020 Campaigns’ Committees Donations
Candidate Position Party Donation
Donald Trump President Republican $182,643
Joe Biden Presidential candidate Democrat $1,124,224
Nancy Pelosi Speaker of the House Democrat $12,150
Chuck Schumer Senate Minority Leader Democrat $1,500
Mitch McConnell Senate Majority Leader Republican $81,450
Kevin McCarthy House Minority Leader Republican $71,800

Despite trying to project himself as the progressive candidate against Trump, Biden has received more than six times the donations from Puerto Rico’s vultures than the current president. The significant difference in donations seems to point to the fact that employees of these funds feel better represented by Biden’s policies.

On the other hand, the Republican leaders, McConnell and McCarthy, far surpass the Democratic leadership, Pelosi and Schumer. The Senate Leader and the House Minority Leader have between them received about $153,000, while the House Speaker and the Senate Minority Leader have received $13,650.

2019-2020 Vulture Funds’ Donations
Fund Candidate Donation
Aristeia Capital Joe Biden $5,600
Donald Trump $1,000
Aurelius Capital Donald Trump $14,000
BlackRock Mitch McConnell $5,600
Joe Biden $100,044
Donald Trump $2,125
Brookfield Asset Management Joe Biden $2,800
Canyon Capital Mitch McConnell $30,600
Emso Asset Management Joe Biden $8,150
GoldenTree Asset Management Mitch McConnell $28,700
Mason Capital Donald Trump $81,200
Oaktree Capital Joe Biden $68,050
Sculptor Capital Joe Biden $3,550
Silver Point Capital Kevin McCarthy $16,200
Taconic Capital Joe Biden $58,900
Total N/A $426,519

The five funds that have donated the most are BlackRock, Canyon, Mason, Oaktree, and Taconic. BlackRock, the world’s largest asset manager, tops the list, surpassing $100,000, mostly for the Biden campaign. Mason Capital stands out for being the fund that has made the most contributions to Trump, with $81,200.

The twelve vulture funds participate in the litigations and negotiations around Puerto Rico’s central government’s plan of adjustment. In the case of BlackRock and GoldenTree, they are also participating in the restructuring of the debt of the Puerto Rico Electric Power Authority (PREPA). Both restructuring agreements are hanging by a thread as the COVID-19 pandemic completely changed the economic landscape.

Law firms representing the vulture funds, and the oversight board’s attorneys, have also been donating to candidates’ campaigns. The following table shows their donations and the clients for whom they work.

2019-2020 Vulture Law Firms’ Donations
Law Firm Client Candidate Donation
Davis Polk & Wardwell Commonwealth Bondholder Group Joe Biden $77,550
Nancy Pelosi $1,000
Donald Trump $3,195
Jones Day Employees Retirement System Secured Creditors Joe Biden $57,751
Nancy Pelosi $250
Donald Trump $9,303
Kramer Levin Ad Hoc Group of PREPA Bondholders Joe Biden $47,080
Chuck Schumer $1,500
Donald Trump $70
Morgan Lewis QTCB Noteholders Group Joe Biden $134,497
Donald Trump $1,592
Morrison & Foerster Ad Hoc Group of Constitutional Debtholders Joe Biden $67,911
Donald Trump $1,187
Paul Weiss Ad Hoc Group of General Obligation Bondholders Joe Biden $381,526
Mitch McConnell $16,500
Donald Trump $1,975

Proskauer Rose

Oversight Board Joe Biden $25,062
Kevin McCarthy $55,600
Mitch McConnell $50
Nancy Pelosi $10,900
Donald Trump $65,000
Quinn Emanuel Lawful Constitutional Debt Coalition Joe Biden $46,058
Donald Trump $942
Willkie Farr Ad Hoc Group of General Obligation Bondholders Joe Biden $24,653
Donald Trump $1,048
Total N/A $1,047,249

In first place is Paul Weiss, with $400,000 in donations. This firm represents the Ad Hoc Group of General Obligation Bondholders, a group made up of Autonomy and Aurelius Capital. Aurelius was the vulture fund that challenged the validity of the oversight board on the grounds that the appointments violated the appointments clause of the United States constitution. The Supreme Court upheld the constitutionality of the oversight board.

By June 2020 Aurelius and Autonomy owned over a billion in central government bonds.

The second law firm that has donated the most in this electoral cycle – Proskauer Rose, with over $156,000 donated – is the legal representative of the oversight board in the bankruptcy court. In fact, the largest chunk of those donations comes from the board’s legal team leader Martin Bienenstock, totaling $120,600, going to the Trump and McCarthy campaigns.

Finally, Morgan Lewis & Bockius, a firm representing the QTCB Noteholders Group, ranks third with over $136,000. This group is made up of Davidson Kempner, Canyon Capital and Sculptor Capital. By June 2020 these three vulture funds reported to the court that they jointly held $1.9 billion in central government bonds.

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