(MENAFN- AFP) A group of small Argentina "holdout" creditors has complained they are being ignored while the country settles with major bondholders and is seeking the removal of the court mediator in the case.
Mohammed Ladjevardian, of the Houston firm United Capital Investments, said his complaint to the New York district court dated Wednesday represents more than $27 million in debt defaulted on by Argentina in 2001.
Ladjevardian alleged that while the mediator, Daniel Pollack, has facilitated multibillion-dollar settlements between the country and its largest holdout bondholders since February, Pollack "has orchestrated this systematic isolation of the plaintiffs and other small bondholders."
He said that in all, the claims of small creditors being ignored and not being protected in the settlement deals amount to more than $832 million.
Despite the size of their interests, "they have been purposefully frozen out of the ongoing settlement discussions between Argentina and certain other plaintiffs," the complaint alleged.
The complaint says that Argentina has made the small creditors a "take it or leave it offer" that is worth some 29 percent less than that for the larger creditors.
At the same time, it notes many of the small creditors have held their bonds since before the country defaulted on nearly $100 billion in debt in 2001.
The hedge funds that have already reached deals, on the other hand, mostly scooped up the bonds at steep discounts around the time of the default and have reaped generous profits on the repayment deals.
In an email to AFP, Pollack rejected the complaints. "His accusations are baseless," he said.
After a long legal battle with creditors, Argentina is seeking to settle some $9 billion in claims against it, in hopes of clearing its record and regaining access to international markets.
Earlier this month Ladjevardian wrote to Pollack saying his effort to get the mediator involved in his claim "has fallen to deaf ears" and said he would ask the court to remove Pollack for a more sympathetic mediator.
Pollack replied the next day that he does "not respond well to rudeness or threats" and characterized Ladjevardian's case as complicated by "some kind of marital dispute between you and your wife or ex-wife," according to court filings.
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