Institutions that are not original bondholders and that acquired the bonds for speculative purposes. Bondholders are considering suing Peru in foreign or international courts. A Connecticut-based hedge fund is one of the largest bondholders.

Report Highlights: Peru on January 18, 2014, passed Supreme Decree 017-2014-EF. The decree details procedures as to how Peru will compensate land-reform bondholders. The land-reform bonds were originally issued in the 1970s as compensation for land seized for redistribution among Peru’s poor by then leftist dictator General Juan Velasco. Prior to the Constitutional Court’s decision, which effectively allows the government to pay a fraction of the amount owed – by some estimates as little as $400 million – government and private estimates had valued the bonds at between $1 billion to $8 billion. FAS Lima foresees the government of President Ollanta Humala favoring the least onerous compensation method; most likely a combination of new government-issued bonds and government-owned agricultural land. Reportedly bondholders are considering suing Peru in foreign or international courts. Gaspar E. Nolte and Mariano Beillard Emiko Purdy Agriculture in the News Agriculture in the Economy Land-Reform Bondholders’ Plight Lima Peru 1/23/2014 Voluntary Public General Information: Peru on January 18, 2014, passed Supreme Decree 017-2014-EF. The decree details procedures as to how Peru will compensate land-reform bondholders. The decree brings the Government of Peru into compliance with the Constitutional Court’s ruling of July 16, 2013 (reaffirming the earlier 2001 sentence), whereby the government is legally required to honor its bond debt. The land-reform bonds were originally issued in the 1970s as compensation for land seized for redistribution among Peru’s poor by then leftist dictator General Juan Velasco. Subsequent presidents have strongly resisted honoring the bond debt. Bondholders are given five years to submit their cash out requests. Upon the application’s receipt, the Ministry of Finance will verify the veracity of the land-reform bond claim. Bondholders become eligible for payment only after the ministry’s confirmation of the bond’s authenticity (which can take upwards of two years). Once eligibility is established, the government can take an additional eight years to pay the bondholder. Prior to the Constitutional Court’s decision, which allows the government to pay a fraction of the amount owed – by some estimates as little as $400 million – government and private estimates had valued the bonds at between $1 billion to $8 billion. The decree adopts the valuation method, one of the three methods recommended by the Constitutional Court. Detrimental to bondholders’ interests is that the method selected allows the government to fix the bonds’ cash out payments to the dollar’s exchange rate prevailing on the bonds’ date of issue (by when the local currency had been devalued) instead of utilizing the expropriation date as the baseline year. The U.S. Treasury bond interest rate, currently one of the lowest rates in world, will be used to calculate the bonds’ accrued interest value. Eligible bondholders are required to select a payment method; which include cash payments, new government-issued bonds, and government-owned land and or tax credits. FAS Lima foresees the government of President Ollanta Humala favoring the least onerous compensation method; most likely a combination of new bonds and government-owned agricultural land. Incidentally compensation in the form of government-owned land will facilitate the Humala government’s policy of bringing idle lands suitable for agriculture into production. Article 19 of the Decree details the priority whereby bond holders will be paid: 1. Original bondholders, 65 years old or older, or their heirs. 2. Original bondholders, younger than 65 years old, or their heirs. 3. Non original bondholders 65 years old or older. 4. Non original bondholders younger than 65 years old. 5. Institutions that are original bondholders. 6. Institutions that are not original bondholders, but have received the bonds as payment for legitimate debts. 7. Institutions that are not original bondholders and that acquired the bonds for speculative purposes. Bondholders are considering suing Peru in foreign or international courts. A Connecticut-based hedge fund is one of the largest bondholders.

http://gain.fas.usda.gov/Recent%20GAIN%20Publications/Land-Reform%20Bondholders%E2%80%99%20Plight_Lima_Peru_1-23-2014.pdf

Der Anfang der "Vogel Scheisse " Klage....

Der Anfang der "Vogel Scheisse " Klage....

http://ia801509.us.archive.org/25/items/gov.uscourts.nysd.444890/gov.uscourts.nysd.444890.1.0.pdf

Case # 1:15-cv-05551 Filed Jul 16, 2015 // MMA Consultants 1, Inc. v. Republic of Peru

Donnerstag, Juli 16, 2015
3	CIVIL COVER SHEET filed. (Ahern, Patrick)
2	MOTION for Patrick J. Ahern to Appear Pro Hac Vice . Filing fee $ 200.00, receipt number 0208-11163633. Motion and supporting papers to be reviewed by Clerk's Office staff. Document filed by MMA Consultants 1, Inc..(Ahern, Patrick)
	Att: 1 Exhibit Certificate of Good Standing,
	Att: 2 Text of Proposed Order
1	COMPLAINT against Republic of Peru. (Filing Fee $ 400.00, Receipt Number 0208-11163260)Document filed by MMA Consultants 1, Inc..(Ahern, Patrick)
	Att: 1 Exhibit Exhibit 1,
	Att: 2 Exhibit Exhibit 2,
	Att: 3 Exhibit Exhibit 3,
	Att: 4 Exhibit Exhibit 4,
	Att: 5 Exhibit Exhibit 5

MMA Consultants 1, Inc. v. Republic of Peru

Court	New York Southern District Court
Judge	Deborah A Batts
Nature of Suit	190 Contract - Other Contract
Cause	28:1330 Breach of Contract

Case #	1:15-cv-05551
Filed	Jul 16, 2015

• Docket
• Parties

Peru Sued By Illinois Firm For Unpaid Guano Bonds

Submitted by Tyler Durden on 07/17/2015 17:45 -0400

• Bond
 
• Creditors
 
• fixed
 
• Illinois

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If you’ve followed the recent evolution of fixed income products, you’re well aware that when it comes to pooling assets and securitizing cash flows, pretty much anything goes. From subprime auto loans, to credit card receivables, to P2P debt, to PE home flipper loans, you name it and there’s a fixed income security for it. 

Given the above, we were fairly certain that when it comes to bonds, nothing would surprise us in terms of debtors, creditors, and the underlying assets. 

We were wrong. 

As Bloomberg reports, Illinois-based MMA Consultants 1 Inc has filed suit in U.S. District Court in connection with money the firm says it is owed by The Republic of Peru for bonds issued in 1875. Here’s more:

Fourteen bonds the country issued in 1875 .. are now held by an Illinois firm that says it’s having a hard time redeeming them.

MMA said it sent three letters to Peru’s Minister of Economics and Finance requesting payment to no avail. The company is suing for breach of contract. It didn’t reveal in the lawsuit how it came by the bonds.

If that were the whole story, it wouldn’t be all that interesting. Fortunately, there’s more: 

[The] bonds were issued to pay off debt to a U.S. guano consignment company.

Each bond promised a payoff of $1,000 "United States Gold coin" plus 7 percent interest a year, according to the complaint filed Thursday by MMA Consultants 1 Inc. in federal court in New York.

The bonds bear the signature of Don Manuel Freyre, who is described as the "Envoy Extraordinaire and Minister Plenipotentiary of Peru," according to the complaint.

Because we cannot imagine what we could possible add that would make this any more amusing than it already is, we’ll simply leave you with the following summary:

MMA Consultants 1 is attempting to collect what, with interest, amounts to $182 million in gold coins from "Envoy Extraordinaire" Don Manuel Freyre, in connection with bonds Peru issued 140 years ago to pay off a debt to a seabird dung consignment company.

(Don Manuel Freyre, Envoy Extraordinaire)  

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