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Junta Fiscal

Fiscal Board Hires Former Officials Who Lobbied for PROMESA

Emiliano Trigo-Fritz, former federal advisor to former Fovernor Alejandro Garcia Padilla, and former Resident Commissioner, Pedro Pierluisi, joined O'Neill & Borges, a firm that since November has legal counsel contracts with the Fiscal Control Board (FCB).

Both Wheat-Fritz and Pierluisi were actively involved in the process of pushing, delineating and configuring the federal PROMESA legislation that created the FCB. In addition, several sources of NotiCel have recently seen former Governor Alejandro Garcia Padilla in the offices of the O'Neill <><>& Borges law firm in Hato Rey./p


According to the firm's website, Pierluisi returned to the firm on January 9, 2017, just days after finishing his term as a resident commissioner. Pierluisi had already been a member of it in 1997; Where his son, Michael Pierluisi, also worked last year until being named in December as the new secretary of the Department of Consumer Affairs (DACO). For his part, Trigo-Fritz joined the legal firm as an associate in the corporate department.

The reinsertion of the former resident in the firm puts the lens on the opportunities and personal advantages that PROMESA represents for him and his wife, María Elena Carrión. The ex-commissioner, although he does not work directly with the board-minded firm,benefits from the millionaire income the firm has for working with the Board and his wife because, as The New York Times put it early in 2016, A company that represents creditors and investors interested in Puerto Rico.

O'Neill <><>& Borges, a law firm established in Puerto Rico since 1962, was among the first signatures hired after joining the FCB in 2016 as external legal advisor to the governing body./p


'Graduates Hermann Bauer and Julio Pietrantoni will be in charge of directing the encomienda in O'Neill <><><><><><><><><><> Borges. Bauer is part of the firm's Litigation Department and has extensive experience in bankruptcy and creditor rights,'the FCB announced on November 27, 2016./p


Pierluisi worked directly with the PROMESA Law that created the FCB for being the elected representative of the territory before the Congress.While former Governor Garcia Padilla delegated his representation to Wheat-Fritz, who worked hand-in-hand with then-director of the Federal Treasury Office for State and Local Finance, Kent Hiteshew./p


'It is highly questionable that those who lobbied intensely for the imposition of the Fiscal Control Board will now be hired by the Board's advisors,' one source said in connection with the PROMESA approval process in Washington DC./p


During the approval process of PROMESA, the then resident commissioner Pedro Pierluisi and the ex-governor Garcia Padilla demanded that the federal legislation would give the guidelines to work with the fiscal crisis and the restructuring of the priceless public debt./p


The support of the main elected officials was instrumental in the approval of the legislation, which was elaborated mainly by the Federal Treasury./p


The long process was driven by opposition from multiple sectors of society, politicians and professionals that raised the broad powers that the fiscal board would have over democratically elected government; Aggravated by the refusal ofTreasuryto grant tax relief to the territory.

In fact, according to the source, the lack of pressure from these officials to rationalize the speech thatTreasury Department could not do anything else provoked pressures such as that exercised by Democratic Senator Elizabeth Warren during a congressional hearing on Puerto Rico in Federal Senate, did not have effect to achieve a tax rescue.

At a federal senate hearing, Warren challenged Federal Treasury Department spokesman Antonio Weiss on alternatives to a tax bailout for Puerto Rico similar to that made with banking in the 2008 financial meltdown.

'With the main elected officials of Puerto Rico, advocating for PROMESA; The work of those like Warren, Bernie Sanders, Robert Menendez, Luis Gutierrez, and others opposed to PROMESA and the board was uphill. The White House and Congress, therefore, did not see PROMESA as an imposition; But as responding to the call made by Garcia Padilla and Pierluisi,'the source said.

Despite the position of Hiteshew, and the work that made his office for the creation and approval of PROMESA, publicly the main link the Treasury with Puerto Rico was the adviser Antonio Weiss, creature of Wall Street. The Senate suspended his appointment to the Treasury precisely because it was too biased towards Wall Street. He was then appointed as an advisor to the Treasury, since he did not require confirmation.

'Hiteshew's work as a key figure in the PROMESA process was possible and influenced by his varied career in municipal securities, including 30 years in public finance on Wall Street,' The Bond Buyer published last December. In history he mentions Wheat-Fritz's work as the government's liaison with the Obama administration to work on PROMESA.

Pedro Pierluisi (NotiCel Archive)