THE PROFIT MOTIVE AT WORK

Despite what Sean Hannity says, the results are not always good for society. Here's some international high finance I was unaware of:

How top London law firms help vulture funds devour their prey
Indebted poor countries are being taken for millions of dollars in the courts
Ashley Seager and James Lewis
Wednesday October 17 2007
The Guardian

Vulture funds buy up sovereign debt issued by poor countries at a fraction of its face value, then sue the countries in courts - usually in London, New York or Paris - for their full face value plus interest.

Donegal International, an offshore vulture fund, burst into the spotlight this year when it won an award for $15m from impoverished Zambia in the UK High Court. Donegal paid $3m for some old Zambian debt, then sued for $55m, although the London judge reduced the award to $15m.

A paper prepared for the IMF/World Bank meetings this week shows there are now $1.8bn of lawsuits against poor countries where people typically live on less than $1 a day.

The biggest vulture fund is Elliott Associates run by Paul Singer, billionaire donor to President Bush and presidential hopeful Rudi Giuliani.

On one occasion, Elliott spent $12m on "distressed" Peruvian debt in 1996 and four years later forced Peru to pay almost $58m to redeem it. He is reputedly worth £8bn and contributed $300,000 to Bush's election campaign in 2000 (above) and $1.2m in 2004.

He also bought some of Congo's debt for $10m and sued for $127m. The Congolese government was found to be corrupt and under US racketeering law, Singer may be able to claim triple damages, reaping as much as $400m.