Puerto Rico has been the site of several impressive financial booms and busts over the past 20 years. The island was given some favorable breaks by the U.S. Congress, including the unique tax treatment of investment revenues.
As a consequence of these breaks, many investors established their businesses in San Juan, the island’s capital and largest city. Also as a consequence of these financial shields, many speculators looked on Puerto Rico as a favorable feeding ground for financial sharks.
Some early schemes
Federal tax law gave Puerto Rico residents a break that attracted many speculators: Puerto Rico residents who purchased bonds issued by the Commonwealth owned the bonds free from federal tax on gains and interest.
More than one speculator attempted to copy this model and sell “tax-free” securities to Puerto Rico residents. Unhappily, some of these imitation Commonwealth bonds were not backed by the same securities as bonds actually issued by the Commonwealth.
When the bonds went south, their purchasers looked to the sellers of the bonds to repay their losses. Not every seller of these bonds lacked the wherewithal or the willingness to reimburse the investors.
One large international financial institution, UBS Financial Services, Inc., sold what are called “closed-end bonds;” at first these offerings appeared to be very profitable, but ultimately, investors lost billions of dollars when UBS could not redeem the bonds.
Naturally, the Puerto Ricans who lost money in these schemes wanted legal representation to attempt to recover their investments. San Juan has a large number of very qualified attorneys, and many of these lawyers were among the first hired in the attempt to recover lost investments. But soon, lawyers from the United States were also hired in multiple efforts to retrieve lost investments.
Timothy J. Dennin
One of the most successful of the stateside attorneys retained to chase lost funds in the Commonwealth was Timothy J. Dennin. Mr. Dennin once worked in the Securities Exchange Commission, and the experience gained on this job has served him (and his clients) well. He has achieved notable success in pursuing fraud claims in Puerto Rico against Puerto Rico corporations and individuals, and he continues to accept representation of individuals who live in Puerto Rico.