Justin Peterson, nombrado por el presidente Donald Trump a la Junta de Supervisión Fiscal. (Página de DCI Group) (Suministrada)

Washington / San Juan - President Donald Trump announced his intention to appoint Justin Peterson as a new Oversight Board member. Peterson is managing director of DCI Group, a firm that has represented general bondholders and coordinated the toughest smear campaign against the government of Puerto Rico.

The White House issued a statement yesterday indicating that President Trump intended to appoint Peterson, which usually happens almost immediately, but the announcement came two days after the resignation of the José Carrión III from the Board overseeing the island’s finances became effective.

Without Carrión, the Board has only four remaining members and no power to approve plans to restructure the island’s public debt. José Ramón González and Carlos García also resigned from the Board last August.

At a time when there have been no agreements with congressional leaders to renew the Board’s three vacancies, everything indicates that Peterson’s appointment was made directly by President Trump to replace González.

El Nuevo Día asked the Board who was Peterson replacing and when would he join the entity but they indicated they would not make any comments.

Peterson is managing partner at DCI Group, a public relations and lobbying firm that during 2016 articulated a campaign in favor of the first organized group of General Obligation (GOs) bondholders and against Alejandro García Padilla administration. The campaign sought to resume payments to bondholders and was against a law to restructure the island´s debt.

Democrats, including Joe Biden’s committee, said Trump is appointing a person “with a clear conflict of interest” to the Board.

Cristóbal Alex, on behalf of former Vice President Biden, said that Puerto Ricans recognize corruption when they see it, and this appointment is just another example of Donald Trump’s dangerously anti-Puerto Rican agenda.

“Once again, the President is using his powers to undermine the interests of the people of Puerto Rico. Just weeks before the election, Trump has made an appointment that could impact the lives of Puerto Ricans for decades,” said Congresswoman Nydia Velázquez.

For Democrat Raúl Grijalva (Arizona), chairman of the House Committee on Natural Resources -which has primary jurisdiction over PROMESA, the law that created the Board - Peterson’s appointment “reminds us that the White House and its allies will never give priority to debt relief for the government of Puerto Rico.”

DCI was initially hired to lobby on behalf of the former Doral Bank, which was demanding a $229 million refund from the government of Puerto Rico that the courts later ruled against. To that end, in 2014, DCI launched a smear campaign against the government of Puerto Rico through the American Future Fund (AFF), a political action group based in Iowa, where Peterson had political experience.

In September 201, in full-page ads in The Wall Street Journal and Politico, AFF accused former Governor García Padilla of maintaining “Puerto Rico’s culture of corruption.”

(Lauren Stange)

Doral’s legal representative in Puerto Rico was Ramón Rosario Cortés, who later became Ricardo Rosselló Nevares' Secretary of Public Affairs. DCI Group had contracts with PPD politicians such as Héctor Ferrer, who died in November 2018, and Roberto Prats, even though he campaigned against the García Padilla government.

DCI Group also worked with the conservative organization Asociación 60 Plus, which - like former governor Rosselló Nevares and Washington Resident Commissioner Jenniffer González - opposed bill 870 by former Resident Commissioner Pedro Pierluisi, to allow public corporations and municipalities on the island to return to Chapter 9 of the federal bankruptcy code.

That company also coordinated the campaigns of MainStreet Bondholders, which recruited Puerto Rican bondholders to pressure the García Padilla administration to comply with the debt payment.

Many DCI Group’s strategies in Puerto Rico were implemented by Ryan Grillo, a partner of the firm, and very close to Peterson, as well as to the lobbyist and member of the law firm King & Spalding, Steve Kupka, according to three sources. King & Spalding was later hired by the Rosselló Nevares administration as lobbyist firm for the Puerto Rico Electric Power Authority (PREPA).

Peterson, Grillo, and Kupka are from Nebraska. Along with publishing ads in Puerto Rican and U.S. media to discredit the island, DCI Group also hired figures linked to the New Progressive Party (PNP) and the PPD.

According to three sources, some political figures received monthly payments with the expectation that they could influence public opinion and public policy decisions regarding the debt restructuring process. These sources also claim that during 2015 and 2016, the organized group of General Obligation bondholders (Ad Hoc-GO) had a monthly budget of between $200,000 and $250,000 for such strategies.

The sources, who requested anonymity, said that payments made to figures linked to the main political parties were not always made through DCI Group, but through other entities, which would allow a person to deny having worked for that public relations and lobbying firm.

When Rosselló Nevares took office and strategies seeking that bondholders receive their pay did not prove to be effective, - the governor requested the Board for PROMESA Title III - then strategies focused on discrediting the island in accessing federal funds after Hurricane María with controversies such as the hiring of Whitefish Holdings and against statehood.

Between 2017 and 2018 alone, the Hobart, Hallaway, and Qualye firm reported $350,000 in revenue and expenses in lobbying in Congress on behalf of DCI Group, representing Puerto Rico general obligations bondholders.

Peterson worked in Iowa in the George W. Bush 2000 presidential campaign. He was not only an advisor to the Ad Hoc General Obligations (GOs) Group but also has served “as an advisor to creditor committees in high-profile disputes involving General Motors” in Argentina, according to his bio on the DCI Group website, a firm he helped build more than two decades ago.