Isle of Man outlaws vulture funds

businessman handcuffsThe Isle of Man has introduced legislation to outlaw vulture funds which 'exploit the debts of some of the world's poorest countries', after Jersey did so in November.

Vulture funds fall into the category of private equity and hedge funds; they invest in debt issued by entities considered weak or close to default.

In a statement, the government of the Isle of Man says: “The legislation prevents vulture funds from buying up poor nations’ debts for a fraction of their original amount and then using courts to sue for the full value, plus interest and penalty charges.”

The Isle of Man says the new Heavily Indebted Poor Countries Limitation on Debt Recovery Act 2012 outlaws a practice that undermines international debt relief efforts.

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