Jubilee USA Statement on IMF Lending to Argentina

Washington DC - The International Monetary Fund announced a $7 billion increase to its credit line to Argentina. IMF lending to Argentina now totals $57 billion, making it the largest lending program in IMF history.    

Eric LeCompte is the Executive Director of the religious development group Jubilee USA. He has tracked Argentina debt for the last 10 years. LeCompte releases the following statement:

"The new lending to Argentina is very concerning.

“Argentina has had a difficult history with the IMF, austerity and predatory vulture hedge funds. We don't want history to repeat itself."

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Puerto Rico Struggles to Rebuild from Hurricanes Say Religious Leaders

Washington DC - Hurricane Maria pummeled Puerto Rico last September 20th. According to the Associated Press, 60,000 thousand homes still have temporary or blue-tarp-covered roofs that would not survive a Category 1 hurricane. Tens of thousands of people across the island still lack access to housing or reliable electricity. After the hurricanes more than 130,000 people migrated to US States away from the island.

"The hurricane anniversaries urge us to renew our commitment to assist the poorest among our people to rebuild their lives with dignity," noted San Juan's Catholic Archbishop Roberto González. "We all belong to one human family and need to care for one another."

Before Hurricane Maria, Puerto Rico saw a loss of emergency response and medical personnel due to austerity cuts imposed on the island wrestling with a $72 billion debt crisis. As hurricane recovery continues, Puerto Rico lumbers through a bankruptcy process designed by Congress.

"Our people feel in a state of uncertainty a year after Hurricane Maria and we are suffering from austerity measures from the debt crisis," stated Reverend Heriberto Martinez, the General Secretary of Puerto Rico's Bible Society and leader of a coalition to relieve the island's debt. "The impact of the hurricanes is that our people are leaving the island to look for employment and opportunities to improve the lives of their families." ‎

Rebuilding and recovery estimates for Puerto Rico range between $95 billion and $140 billion. The Governor and the island's congressionally mandated fiscal oversight board are requesting a rebuilding package of $125 billion. Over the last year, Congress and the federal government approved about $35 billion of aid for the island.

"Congress and the White House need to come through with the remaining aid so Puerto Rico can rebuild to withstand the next hurricane," shared Eric LeCompte, Executive Director of the religious development group Jubilee USA. LeCompte testified to Congress and Puerto Rico's oversight board on Puerto Rico's financial crisis. "If a minor hurricane hit the island today, we'd see great suffering that could have been prevented. The clock is ticking." ‎

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Eric LeCompte's Thoughts are Featured in America

Eric LeCompte, Executive Director of Jubilee USA was recently quoted in America, The Jesuit Review speaking on rebuilding efforts in Puerto Rico one year after Hurricane Maria. Read excerpt below and follow link to full article.

A year after Hurricane Maria, Puerto Rico is still rebuilding

One year after Hurricane Maria tore through Puerto Rico, rebuilding efforts are still in the early phases, according to Eric LeCompte, the executive director of Jubilee USA Network.

“On the ground itself, it’s really mixed depending on where you are on the island,” Mr. LeCompte told America. “You still see blue tarps,” he said, referring to blue plastic tarps relief workers issued as temporary fixes to leaky roofs. Congress has authorized one-third of the estimated $120 billion some estimate Puerto Rico will require for recovery, Mr. LeCompte said.

The Federal Emergency Management Agency reports that power, water and cell service has been restored to more than 99 percent of the island. But Mr. LeCompte said that power is not stable and Puerto Rico still suffers from blackouts. Countless traffic lights still do not work.

“They’re terribly vulnerable. If another hurricane hit, they would be devastated,” he said.

Migration away from the island, which Mr. LeCompte said continues, could lead to more schools closing. Even before the hurricane, the child poverty rate in Puerto Rico hovered near 60 percent, he said.

“There’s no doubt that Congress is not paying enough attention to Puerto Rico,” Mr. LeCompte said. In 2016, Congress ended tax incentives that had encouraged pharmaceutical companies to do business in Puerto Rico. Many companies left.

This development, along with unscrupulous lending practices, helps explain Puerto Rico’s complicated debt crisis, Mr. LeCompte said. The $72 billion debt is part of the reason Puerto Rico has had a difficult time recovering.

“It continues to struggle as it rebuilds,” Mr. LeCompte said. “We’re looking at a terrible situation made worse by the debt crisis. The reality is that the only way for Puerto Rico to grow is to see significant debt relief.”

Read more here.

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Eric LeCompte Discusses the Anniversary of the Financial Crisis in The National

Eric LeCompte, Executive Director of Jubilee USA was recently quoted in The National speaking on transparency and changes in financial policy in the decade after the financial crisis. Read excerpt below and follow link to full article.

A decade after Lehman's collapse, challenges remain

Eric Le Compte, executive director at Jubilee USA Network, agreed. “We’ve seen some progress on [reducing] risky and predatory lending and the US Dodd-Frank Act [of 2010] helped increase transparency in banking,” he said.

“But we still need debt work-out processes to help stop a crisis and greater laws around responsible lending to prevent the conditions for a crisis.”

Read more here

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After Lehman Brothers, Experts Say Global Financial Crisis Can Happen Again

Washington DC - September 15th marks the ten-year anniversary of the Lehman Brothers investment firm collapse, symbolizing the onset of the 2008 global financial crisis.

"The financial crisis drove 100 million people, mostly women and children, into extreme poverty around the world," noted Eric LeCompte, the head of the religious development group Jubilee USA. "Too many around the world are still feeling the effects of the last crisis and we are not prepared to stop the next crisis." 

In the Spring, the International Monetary Fund and the UN Conference on Trade and Development released reports warning of new debt and financial crises. Last week the head of the IMF, Christine LaGarde, warned that the financial system was still not safe enough and economic recovery around the globe was uneven.

"While we made progress on diagnosing the risky behavior and debt problems that lead to financial crisis, we still don't have a prescription in place to prevent or solve the next crisis," said LeCompte who consulted on a United Nations bankruptcy plan to prevent future crises and advocates for Congressional action on the issue. "In Washington, we are worried about attempts to role back financial crisis prevention measures. Overall, the financial system still lacks adequate responsible lending laws and predictable processes to resolve debt problems." 
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Eric LeCompte is Cited in Ghana Business News on Debt, Tax and Transparency

Eric LeCompte, Executive Director of Jubilee USA was recently quoted in Ghana Business News speaking on transparency. Read excerpt below and follow link to full article.

Lack of transparency in Chinese lending will increase Africa’s debt burden

By Emmanuel K. Dogbevi

Speaking to ghanabusinessnews.com in a telephone interview, Eric LeCompte, Executive Director of Jubilee USA Network, a coalition of religious, development and advocacy groups that works on debt, tax, trade and transparency policies that help end poverty, says Chinese lending lacks the level of transparency that other lending agreements have. This lack of transparency he says will “increase Africa’s debt burden.”

He points out that the situation is driven by the lack of what he calls “responsible lending rules in the international system.”

“China is benefiting from the lack of rules now,” he said.

LeCompte made reference to the period from 2001 to 2005, noting that during that period, growing lending led to debt forgiveness and “debt forgiveness led to economic growth in Africa, but lately the debt burden is growing. You have problems when countries cannot pay,” he said.

According to him, the Chinese are taking advantage of the debt situation to take natural resources from these countries.

“It is absolutely imperative that we find other means to finance African countries,” he added.

LeCompte called for laws to tackle tax avoidance and illicit financial flows from which African countries are losing billions of dollars.

“We need laws for responsible lending and borrowing. We need to look at new creative processes for debt relief. We need laws to curb tax evasion and global bankruptcy rules,” he said.

Read more here

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Religious Development Group Responds to US/Mexico Trade Deal

President Trump announced on Monday that the United States reached a trade deal with Mexico that replaces the previous North American Free Trade Agreement, also known as NAFTA. As the announcement took place, religious groups met with the Office of the US Trade Representative (USTR) on the agreement.

"While we still don't have full details on the agreement, we hope the new agreement ensures greater protections for vulnerable communities than previous trade agreements," noted Jubilee USA Executive Director Eric LeCompte, who was at the USTR meeting. "We believe we've made some progress."

In May, major US religious groups wrote President Trump and Congress urging that trade agreements protect poor people in trade disputes and ensure access to life-saving drugs. The statement was issued by Jubilee USA and the Catholic, Episcopal, United Methodist, Presbyterian, Evangelical Lutheran and United Church of Christ Churches.

A final agreement has not been signed and would need to be approved by Congress. Canada may also join the negotiations on a final or separate agreement.

Read the statement NAFTA and International Public Health: An Interfaith Call for Access to Medicines



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"Stop Corruption and Money Laundering," says United Nations and Multinational Companies 

Washington DC - The UN Economic Commission for Africa renewed calls to tackle money laundering during a UN meeting this week in Addis Ababa. At the meeting, governments were urged to follow the recommendations in the Mbeki report that notes Africa loses between $50 and $80 billion annually through corruption, tax evasion and other "illicit financial flows."

“The revenue loss to countries from tax evasion and money laundering across Africa impact vulnerable communities across the continent," stated Eric LeCompte the Executive Director of the religious development group, Jubilee USA. "Too many African countries are facing new debt crises because of revenue shortfalls." LeCompte serves on United Nation finance expert groups. 

In an opinion piece in The Hill on Thursday, the vice president of the National Foreign Trade Council urged Congress to adopt transparency regulations to tackle money laundering and corruption in connection with Russia. The author cites recommendations from a report of the Atlantic Council that would reveal the actual owner of a shell company. "Anonymous" shell companies can be used as vehicles for corruption and to hide the identity of the owner who benefits from the corporation. Board members of the National Foreign Trade Council are a who's who of multinational businesses including Amazon, Chevron, Ford, Facebook, Deloitte and Walmart.

"Congress is considering legislation that can help address global corruption and tax evasion," noted LeCompte.

Legislation currently under consideration by the US Congress could help address the money laundering problem. Representatives Carolyn Maloney (D-NY) and Peter King (R-NY) introduced the Corporate Transparency Act (HB3089) in the House. Senators Ron Wyden (D-OR) and Marco Rubio (R-FL) introduced the companion Senate bill (S1717). The legislation would create a registry for the true owners of shell companies.

Last week 24 US Attorneys General wrote Congress asking for legislation like the Corporate Transparency Act.   

Read the report Mbeki report on illicit financial flows

Read the Atlantic Council Report

Read the Attorneys General Congress Letter

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Over 20 State Attorneys General Call for Shell Company Transparency

Washington DC - 24 State Attorneys General wrote to Congress supporting action to disclose the actual owner of a shell company to law enforcement. "Anonymous" shell companies can be used to hide the identity of the owner.

"Shell companies are used by corrupt government officials to steal money from their people and hide the identities of people involved in the modern day human slave trade," stated Jubilee USA Executive Director Eric LeCompte who serves on United Nations financial expert groups.

The Attorneys General letter raises concerns of how shell companies are sometimes used. "The use of anonymous shell companies by those engaged in human trafficking, drug dealing, and other crimes, allows criminals to launder and spend money attained through criminal activity without accountability," wrote the Attorneys General.

"Shell companies provide vehicles for tax evasion and corruption that contribute to an annual trillion dollar loss to the developing world," said LeCompte.

Read the Attorneys General Letter here.

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New Student Loan Rule Sides with For-Profit Colleges

Washington DC - This week the US Department of Education proposed new student "borrower defense" rules.

"If implemented, these rules place a greater burden on students to prove their case for debt relief when for-profit colleges mislead or defraud them," stated Jubilee USA Executive Director Eric LeCompte. LeCompte's organization supported 2016 federal regulations that allowed students to receive debt relief after the collapse of two for-profit schools, ITT Technical Institute and Corinthian Colleges.

Because the bar would be higher for students to prove their case for debt relief under the new rule, the Trump Administration argues federal student debt relief would be reduced by $13 billion over 10 years. The regulations now face a 30 day open federal comment period. If the Administration finalizes the rules, they could go into affect in 2019.

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