Judge criticizes Argentina for 'half-truths' at hearing
Aug 1 (Reuters) - U.S. District Judge Thomas Griesa, in a stern tone, on Friday criticized Argentina's decision to default on $29 billion in debt earlier in the week rather than pay holdout investors as ordered.
In a court hearing, Griesa told lawyers for Cleary Gottlieb, which represents Argentina, to "take steps to stop the misleading information being released by the Republic" regarding the battle between investors and the country. Elected officials in the South American nation have repeatedly stated that they had met their debt obligations, which Griesa said was a "half truth."
"The republic has issued public statements that have been highly misleading, and that has to be stopped," he said.
Griesa had ordered the nation to pay $1.33 billion plus interest to NML Capital, a unit of Elliott Management Corp, and Aurelius Capital Management, the two leading U.S. hedge funds who were not among those who agreed to accept new bonds after the nation defaulted in 2002.
Argentina argues that by depositing $539 million for a scheduled June 30 coupon payment at the Central Bank of Argentina in the account of Bank of New York Mellon, the trustee, that it had satisfied its obligation to pay its debts. Griesa had ordered BNY Mellon not to transfer that money to bondholders that exchanged debt in 2005 and 2010.
"Half-truths are not the same as the truth," he said in court on Friday.
The hearing was called to "clarify where we go from here," Griesa said, saying that "what occurred this week did not extinguish or reduce the obligations of the Republic of Argentina." (Reporting By Joseph Ax and Nick Brown; Editing by Meredith Mazzilli)