Case: LTS Doc#:5125 Filed:02/14/19 Entered:02/14/19 06:00:06 Document Page 1 of 18

Transcription

1 Document Page 1 of 18 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO X In re: THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO, as representative of PROMESA Title III No. 17 BK 3283-LTS THE COMMONWEALTH OF PUERTO RICO, et al., Debtors X THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO, Adversary No: Plaintiff, v. HON. THOMAS RIVERA-SCHATZ (in his official capacity and as a representative of the SENATE OF PUERTO RICO), Defendant X VERIFIED COMPLAINT FOR DECLARATORY RELIEF, INJUNCTIVE RELIEF AND WRIT OF MANDAMUS 1 The Debtors in the underlying Title III case, along with each Debtor s respective Title III case number listed as a bankruptcy case number due to software limitations and the last four (4) digits of each Debtor s federal tax identification number, as applicable, are the (i) Commonwealth of Puerto Rico (Bankruptcy Case No. 17 BK 3283-LTS) (Last Four Digits of Federal Tax ID: 3481); (ii) Puerto Rico Sales Tax Financing Corporation ( COFINA ) (Bankruptcy Case No. 17 BK 3284-LTS) (Last Four Digits of Federal Tax ID: 8474); (iii) Employees Retirement System of the Government of the Commonwealth of Puerto Rico ( ERS ) (Bankruptcy Case No. 17 BK 3566-LTS) (Last Four Digits of Federal Tax ID: 9686); (iv) Puerto Rico Highways and Transportation Authority ( HTA ) (Bankruptcy Case No. 17 BK 3567) (Last Four Digits of Federal Tax ID: 3808); and (v) Puerto Rico Electric Power Authority ( PREPA ) (Bankruptcy Case No. 17 BK 4780-LTS) (Last Four Digits of Federal Tax ID: 3747) (Title III case numbers are listed as Bankruptcy Case numbers due to software limitations).

2 Document Page 2 of 18 Plaintiff the Financial Oversight and Management Board for Puerto Rico (the Oversight Board ), alleges as follows for its Verified Complaint against Defendant Hon. Thomas Rivera- Schatz (the Senate President ), in his official capacity as President of the Senate of Puerto Rico and as a representative of the Senate of Puerto Rico (the Senate ): NATURE OF THE ACTION 1. This action seeking declaratory and injunctive relief and a writ of mandamus is brought pursuant to the Puerto Rico Oversight, Management, and Economic Stability Act, 48 U.S.C ( PROMESA ). 2. The purpose of the Oversight Board is to provide a method for [Puerto Rico] to achieve fiscal responsibility and access to the capital markets. PROMESA 101(a). Congress vested the Oversight Board with powers to assist it in accomplishing its statutory mission. Most fundamentally, the Oversight Board has the responsibility to approve and certify fiscal plans and budgets for both the Commonwealth and its instrumentalities. See PROMESA 101(d)(1), 201(c)(3), (e), 202(c)-(f); 48 U.S.C. 2121(d)(1), 2141(c)(3), (e), 2142(c)-(f). The Oversight Board also has the obligation to monitor and review government actions for compliance with certified fiscal plans and budgets for the Commonwealth and its instrumentalities. See PROMESA 203(a)-(c), 204(a); 48 U.S.C. 2143(a)-(c), 2144(a). PROMESA 104(c)(2), in pertinent part, provides: The head of the entity of the territorial government responsible shall provide the Oversight Board with such information and assistance (including granting the Oversight Board direct access to automated or other information systems) as the Oversight Board requires under this paragraph. 3. This action relates to the Oversight Board s ability to procure critical official data in the performance of its duties under PROMESA. Specifically, PROMESA gives the 2

3 Document Page 3 of 18 Oversight Board the right to secure copies, whether written or electronic, of such records, documents, information, data, or metadata from the territorial government necessary to enable the Oversight Board to carry out its responsibilities under this Act. PROMESA 104(c)(2). This right exists notwithstanding any other provision of law, and is fundamental for the Oversight Board to effectively carry out its duties under PROMESA. Id. Thus, [a]t the request of the Oversight Board, the Oversight Board shall be granted direct access to such information systems, records, documents, information, or data as will enable the Oversight Board to carry out its responsibilities under this Act. Id. 4. As a result of the lack of audited financial statements and recurring questions regarding the cash position of the Commonwealth and its instrumentalities, the Oversight Board initiated a project, pursuant to its powers under PROMESA, to report and identify bank and investment accounts of government entities along with explanations of any restrictions on the funds they hold (the Project ). The Oversight Board tasked an Independent Forensic Analysis Team, through the retention of Duff & Phelps, LLC, to develop and lead the Project, and report to the Oversight Board regarding its findings. 5. The Project requires, among other things, the collection and analysis of information from government entities regarding (i) the cash balance in each bank account at a date certain; (ii) account holder representations as to whether and to what extent the funds in each of those bank accounts are legally restricted; and (iii) explanations of the nature of the restrictions on those funds in each bank account. All of this information is critical to the Oversight Board s work in developing a cash baseline in the debt analysis and restructuring process. 3

4 Document Page 4 of Consistent with its mandate under PROMESA, and to push the Project forward, the Oversight Board s Executive Director, Ms. Natalie A. Jaresko, sent a letter by electronic mail on November 26, 2018 (the November 26, 2018 Letter ) to Mr. Roberto Maldonado of the Senate, asking to review bank account balances and other financial information of the Senate. See Exhibit A. As explained in the November 26, 2018 Letter, the purpose of the Oversight Board s request was to obtain a comprehensive view of the cash position of the Government and its instrumentalities, which would allow it to assess government spending, compliance with the fiscal plans and budget, and to monitor progress on financial matters generally. Similar communications were sent to other government entities in the Commonwealth that were account holders identified as part of the Project. 7. After the Senate failed multiple times to provide the data requested by the Oversight Board, on February 6, 2019, the Senate, in a letter signed by the Senate President, announced its refusal to provide the information, contending the petition exceeds the powers that PROMESA conferred on the [Oversight Board] and that they are an inappropriate interference in internal administrative matters of the Legislative Branch. See Exhibit B. 8. Based upon the responses from government entities other than the Senate, the Project identified 164 account holders and approximately 1,923 bank accounts. The Senate President is the only head of a Puerto Rico government entity that refused to provide the financial information requested as part of the Project. 9. As a result of this wrongful refusal to provide this critical information, the Oversight Board seeks a declaration that: (i) the Senate is an entity of the territorial government of Puerto Rico, as such term is used in Section 104(c)(2) of PROMESA; (ii) the Senate has a legal obligation pursuant to Section 104(c)(2) of PROMESA to provide the 4

5 Document Page 5 of 18 Oversight Board with the information requested; (iii) the request for the specified financial information from the Senate is within the powers that PROMESA conferred on the Oversight Board; and (iv) the Senate is violating PROMESA by failing to provide the requested financial information. The Oversight Board also seeks injunctive relief compelling the Senate to comply with the Oversight Board s requests for financial information from the Senate. Finally, the Oversight Board seeks a writ of mandamus, ordering the Senate President as the head of the Senate to comply with his ministerial duty under PROMESA of providing the Oversight Board the financial information requested from the Senate and to provide a representative of the Oversight Board onsite access to all its information systems containing financial data. PARTIES 10. Plaintiff Oversight Board is an entity within the Commonwealth government established pursuant to PROMESA. 11. Defendant Thomas Rivera-Schatz is a Senator of the Commonwealth of Puerto Rico and the Senate President. Plaintiff sues the Senate President, and any successors thereto, in his official capacity. 12. Pursuant to Rule 6.1(p) of the Senate Regulations, R. of S. 13 (as amended as of January 22, 2018), the Senate President shall represent the Senate and will appear before the General Court of Puerto Rico or before a Court of the United States in any action that lies against the Senate, its officials, commissions and officers of these, by reason of their legislative functions. (Unofficial translation.) JURISDICTION AND VENUE 13. This Court has federal question jurisdiction over this action pursuant to 28 U.S.C because this action arises under PROMESA. This Court also has subject-matter 5

6 Document Page 6 of 18 jurisdiction over this action pursuant to PROMESA 106(a) because this action arises out of PROMESA. This Court also has subject-matter jurisdiction over this action pursuant to PROMESA 306(a)(2) because this action relates to the Commonwealth Title III case and it has a connection to, or likelihood of interference with, such Title III case, which has the principal purpose of adjusting the financial liabilities of the Commonwealth. 14. This Court has personal jurisdiction over the Senate President because he has minimum contacts with the United States and is located in this District and conducts the official business of the territorial government of Puerto Rico in this District. This Court also has personal jurisdiction over the Senate President pursuant to PROMESA 306(c). 15. Venue is proper in this District pursuant to PROMESA 106(a) because this action arises out of PROMESA. Venue is also proper in this District pursuant to 28 U.S.C because Defendant resides in and conducted a substantial part of the events or omissions giving rise to this action in this District. Venue is also proper in this District pursuant to PROMESA This is an appropriate action for declaratory relief under the federal Declaratory Judgment Act, 28 U.S.C and There currently exists an actual, justiciable controversy between the parties regarding the Senate President s obligation and failure to comply with the Oversight Board s lawful request for bank account balances and other financial information under PROMESA. The Oversight Board has standing to seek this declaratory relief pursuant to PROMESA 104(k), 108, and 315. The requests for declaratory relief are all integral to the ultimate relief requested herein, namely the production of critical financial data. 17. The Court has authority to issue a writ of mandamus pursuant to the All Writs Act, 28 U.S.C. 1651(a), which states that all courts established by Act of Congress may issue 6

7 Document Page 7 of 18 all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law. The Court may also issue a writ of mandamus under its supplemental jurisdiction to enforce Article 649 of the Puerto Rico Code of Civil Procedure. See 32 L.P.R.A. 3421; see also 28 U.S.C (supplemental jurisdiction). FACTS 18. In 2016, the Congress of the United States enacted PROMESA and created the Oversight Board in an effort to stabilize Puerto Rico s economy by establishing oversight of the government s budget and fiscal policies, and by providing a way for the Commonwealth to modify or restructure its debts. PROMESA 101(a). Congress found that severe economic decline combined with accumulated operating deficits, lack of financial transparency, management inefficiencies, and excessive borrowing had created a fiscal emergency in Puerto Rico that affected its long-term stability and rendered the Government of Puerto Rico unable to provide its citizens with effective services. PROMESA 405(m). Congress enacted PROMESA as a comprehensive measure to address Puerto Rico s fiscal, management, and structural problems through the Oversight Board s independent oversight of the Commonwealth s fiscal and budgetary policies. Id. 19. PROMESA grants authority to the Oversight Board to address Puerto Rico s fiscal, management, and structural problems. PROMESA demonstrates that Congress understood that, in order to exercise its fiscal management authority, the Oversight Board would need access to information of the Commonwealth government and instrumentalities. 20. Section 104(c)(2) of PROMESA provides the Oversight Board the right to secure copies, whether written or electronic, of such records, documents, information, data, or metadata from the territorial government necessary to enable the Oversight Board to carry out its 7

8 Document Page 8 of 18 responsibilities under this Act. Moreover, [t]he head of the entity of the territorial government responsible shall provide the Oversight Board with such information and assistance (including granting the Oversight Board direct access to automated or other information systems) as the Oversight Board requires. Id. 21. At its meeting on September 30, 2016, the Oversight Board designated the covered entities subject to oversight under the PROMESA. See Exhibit C (list of covered entities). The list designates the Commonwealth of Puerto Rico (Primary Government) including all departments, offices, programs, etc. and all funds related to Governmental and Business Activities of the Primary Government such as the General Fund Operating Budget and Non-Budgetary funds. Id. The Senate is part of the legislature of the Commonwealth of Puerto Rico, a branch of a covered entity subject to oversight under PROMESA. See Puerto Rico Const., Art. III 1 ( The legislative power shall be vested in a Legislative Assembly, which shall consist of two houses, the Senate and the House of Representatives. ). The Senate s budget is part of the budget of the government of the Commonwealth of Puerto Rico and has historically been treated as such for budget and audit purposes. 22. On May 3, 2017, the Oversight Board, as the representative of the Commonwealth of Puerto Rico, commenced its Title III case under PROMESA in the United States District Court for the District of Puerto Rico. 23. With minor exceptions, the Commonwealth government and its instrumentalities have not published audited financial statements for periods after the fiscal year ended June 30, On November 26, 2018, pursuant to the Oversight Board s lawful undertaking of the Project, the Executive Director of the Oversight Board, Ms. Natalie A. Jaresko, sent the 8

9 Document Page 9 of 18 November 26, 2018 Letter to Mr. Roberto Maldonado of the Senate, requesting to review bank account balances and other financial information of the Senate. See Exhibit A. 25. The purpose of the Oversight Board s request was in furtherance of the Project and intended to obtain a comprehensive view of the cash position of the Government and its instrumentalities, which would allow it to assess government spending, compliance with the fiscal plans and budget, and to monitor progress. Id. 26. The Oversight Board requested at least the following information from the Senate (defined in the November 26, 2018 letter as the Account Holder ) as part of the Project and to otherwise fulfill the Oversight Board s mandate under PROMESA: i. A copy of the chart accounts, and general ledger or trial balance with the information of the Account Holder s (including their subsidiaries) active bank account(s), which can include unrestricted and restricted cash, and any type of investment accounts, as of June 30, 2018; ii. iii. EIN(s) of the Account Holder ; The identity of the financial institution(s) where each of the Account Holder s individual accounts in (i) were maintained as of June 30, 2018; iv. and mailing address for financial institution(s) in (iii), as well as the contact information of your principal point of contact in each of the financial institution(s); v. Account Holder s position regarding which accounts in (i), if any, were designated as restricted as of June 30, 2018; 9

10 Document Page 10 of 18 vi. Account Holder s documentation supporting claimed restrictions and the underlying account entries in your books and records on accounts in (i) above on June 30, 2018; vii. Account Holder s identification, through the provision of documentation or access to same, of the source of funds for accounts claimed as restricted in (vi); viii. Account Holder s knowledge of liens claims or encumbrances of any kind which affect the Account Holder s use of account funds identified in (i); and ix. Identities of the sources of the funds deposited in each bank account (e.g., appropriations, revenues, fees, or federal funds). Id. 27. The Oversight Board requested the financial information as part of the proper implementation of the Oversight Board s fiscal oversight responsibilities under PROMESA. The Project is an important building block that will allow the Oversight Board to carry out necessary debt restructuring negotiations, as well as working capital and liquidity analyses. 28. Upon the Senate s failure to respond, and in order to secure the Senate s compliance, the Oversight Board reached out to Senate representatives on multiple occasions via , text messages, calls and a follow-up letters from December 2018 to early February On February 6, 2019, the Senate sent a letter signed by the Senate President (the Senate Response ). See Exhibit B. 30. The Senate Response acknowledged receipt of several requests from the [Oversight Board] for authorization to access [the Senate s] bank accounts. Id. 10

11 Document Page 11 of The Senate Response, however, only included a copy of the Senate s Audited Financial Statements for Fiscal Year Id. 32. The Senate Response did not satisfy the requests for the detailed financial data up to June 30, 2018 requested by the Oversight Board and described in detail in paragraph 26 of this Complaint. 33. The Senate Response unilaterally and unlawfully concluded that the petition [for bank account information] exceeds the powers that PROMESA conferred on the [the Oversight Board] and is an inappropriate interference in internal administrative matters of the Legislative Branch. Id. 34. The Senate Response to the Oversight Board makes clear the Senate President will not provide the data requested by the Oversight Board pursuant to Section 104(c)(2) of PROMESA, including the bank account balances and other detailed financial information of the Senate, as of June 30, COUNT I DECLARATORY JUDGMENT THE SENATE HAS A LEGAL OBLIGATION TO COMPLY WITH THE OVERSIGHT BOARD S REQUESTS FOR FINANCIAL INFORMATION (28 U.S.C. 2201, 2202; SECTION 104(k) OF PROMESA) 35. The Oversight Board repeats and incorporates by reference the allegations in paragraphs 1-34 as if fully set forth herein. 36. PROMESA allows the Oversight Board to govern the process for the development, adoption, and implementation of a fiscal plan, which shall provide a method for the Commonwealth to achieve fiscal responsibility and access to the capital markets. 37. Under Section 104(c)(2) of PROMESA, the Oversight Board has the right, notwithstanding any other provision in law, to request information necessary to fulfill its statutory responsibilities. 11

12 Document Page 12 of The Senate is a branch of the government of the Commonwealth of Puerto Rico and, as such, is subject to certain oversight powers of the Oversight Board. The Senate s obligation to comply with requests for information made by the Oversight Board is not discretionary. See PROMESA 104(c)(2). 39. The Oversight Board maintains and the Senate denies that the Senate is obligated to deliver the requested information to the Oversight Board. 40. A justiciable controversy exists and the Oversight Board is entitled to a judicial declaration pursuant to 28 U.S.C. 2201, as well as further relief pursuant to 28 U.S.C. 2202, that the Senate is subject to Oversight Board requests under Section 104(c)(2) of PROMESA; that the Senate has a legal obligation pursuant to Section 104(c)(2) of PROMESA to provide the Oversight Board with the information requested to carry out its statutory responsibilities; that demanding financial information from the Senate is within the powers PROMESA conferred on the Oversight Board; and that the Senate is violating PROMESA by failing to provide such information. COUNT II AN INJUNCTION ORDERING THE SENATE AND THE SENATE PRESIDENT TO COMPLY WITH THE OVERSIGHT BOARD S REQUESTS (SECTION 104(K) OF PROMESA) 41. The Oversight Board repeats and incorporates by reference the allegations in paragraphs 1-40 as if fully set forth herein. 42. Section 104(c)(2) of PROMESA, in pertinent part, states the Oversight Board shall have the right to secure copies, whether written or electronic, of such records, documents, information, data, or metadata from the territorial government necessary to enable the Oversight Board to carry out its responsibilities and that [t]he head of the entity of the territorial 12

13 Document Page 13 of 18 government responsible shall provide the Oversight Board with such information and assistance (including granting the Oversight Board direct access to automated or other information systems) as the Oversight Board requires under this paragraph. 43. Both the Senate and the Senate President as the head of the Senate have an obligation to promptly comply with requests for information made by the Oversight Board. 44. Despite numerous extrajudicial attempts, the Senate has failed and refused, and continues to fail and refuse, to provide the information requested to the Oversight Board. 45. The Oversight Board seeks equitable relief in the form of a permanent injunction compelling the Senate and the Senate President to comply with the Oversight Board s requests for financial information from the Senate. 46. Based on the clear and plain language of PROMESA, the Oversight Board is entitled to obtain the requested information. Additionally, without an injunction, the review of the financial information requested will be further delayed, or otherwise impeded, thereby further endangering the financial future of the Commonwealth and its residents and causing irreparable harm. The grant of injunctive relief is in the public interest because access to the requested financial information will improve transparency and accountability, and will allow the Oversight Board to assess the liquidity position of the Commonwealth entities. Conversely, the Senate and the Senate President will not be harmed by an injunction to this effect. 47. Section 104(k) of PROMESA permits the Oversight Board to seek judicial enforcement of its authority to carry out its responsibilities under PROMESA, including its right, notwithstanding any other provision of law, to secure copies, records, documents, information, data, or metadata from the territorial government. 13

14 Document Page 14 of Therefore, the Oversight Board is entitled to equitable relief in the form of an injunction compelling the Senate and the Senate President to comply with the Oversight Board s requests for financial information of the Senate. COUNT III WRIT OF MANDAMUS COMPELLING THE SENATE PRESIDENT TO FULFILL MINISTERIAL DUTIES UNDER SECTION 104(c)(2) OF PROMESA (32 L.P.R.A. 3421; 28 U.S.C. 1367) 49. The Oversight Board repeats and incorporates by reference the allegations in paragraphs 1-48 as if fully set forth herein. 50. The writ of mandamus is an exceptional and privileged remedy directed to any natural person, persons, company or corporation or inferior court of judicature within its jurisdiction requiring them to do some particular act therein specified and which appertains to their office or duty. 32 L.P.R.A For the Court to issue the writ the party to be coerced must have the power to perform the act. Id. Furthermore, the Court may only grant this remedy when there is no plain and adequate remedy in the ordinary course of law. 32 L.P.R.A The Supreme Court of Puerto Rico has established that, as a general rule, a writ of mandamus may proceed to order a public officer to comply with a ministerial duty that does not admit discretion. Córdova v. Cámara de Representantes, 171 D.P.R. 789, 812 (2007); Báez Galib y otros v. Comisión Estatal de Elecciones, 152 D.P.R. 383 (2000). 52. Section 104(c)(2) of PROMESA imposes on the Senate President, as the [t]he head of the entity of the territorial government, i.e., the Senate, the duty to provide the Oversight Board with such information and assistance (including granting the Oversight Board 14

15 Document Page 15 of 18 direct access to automated or other information systems) as the Oversight Board requires under such paragraph. 53. Thus, the Oversight Board seeks a writ of mandamus to compel the Senate President to fulfill his ministerial duty under PROMESA of providing the financial information detailed in paragraph 26 of this Complaint. 54. The efforts by the Oversight Board to obtain the financial information from the Senate have been met with the Senate s unlawful refusal to provide the requested information. 55. The public interest will be served by the issuance of a writ of mandamus because access to financial information is vital to the Oversight Board s purpose of evaluating government spending and compliance with its commitments under the fiscal plans. 56. Mandamus is an appropriate writ to assure the Senate President exercises his nondiscretionary legal duty to provide the information requested by the Oversight Board. 57. The Oversight Board is entitled to a writ of mandamus compelling the Senate President to fulfill his ministerial duties under section 104(c)(2) of PROMESA. PRAYER FOR RELIEF WHEREFORE the Oversight Board prays that Judgment be entered for the Oversight Board and against Defendant, and for the following relief: A. A declaration that: i. the Senate is a branch of a covered entity subject to demands under Section 104(c)(2) of PROMESA; ii. the Senate, through the Senate President, has a legal obligation pursuant to Section 104(c)(2) of PROMESA, to provide the Oversight Board with the information it requested; 15

16 Document Page 16 of 18 iii. the financial information requested is within the powers PROMESA conferred on the Oversight Board; and iv. the Senate, through the Senate President, is violating PROMESA by failing to provide the requested financial information; B. An injunction compelling the Senate, through the Senate President, to comply with the Oversight Board s demands for financial information of the Senate; C. A writ of mandamus, ordering the Senate President to fulfill his legal obligation under PROMESA and to immediately provide to the Oversight Board the financial information of the Senate and provide a representative of the Oversight Board onsite access to the Senate s financial information systems; and D. Granting the Oversight Board such further relief, in law and/or equity, as is just and proper. 16

17 Document Page 17 of 18 Dated: February 13, 2019 San Juan, Puerto Rico /s/ Miguel E. Gierbolini Miguel Gierbolini USDC No Courtney R. Carroll USDC No Gierbolini & Carroll Law Offices, PSC P.O. Box San Juan, PR Tel: (787) Fax: (787) /s/ Martin J. Bienenstock Martin J. Bienenstock (pro hac vice) Stephen L. Ratner (pro hac vice) Timothy W. Mungovan (pro hac vice) PROSKAUER ROSE LLP Eleven Times Square New York, NY Tel: (212) Fax: (212) Attorneys for The Financial Oversight and Management Board for Puerto Rico 17

18 Document Page 18 of 18 VERIFICATION I am Executive Director of the Financial Oversight and Management Board for Puerto Rico. I have read the foregoing Complaint and know the contents thereof, and the same are true to the best of my knowledge, information and belief. I verify under penalty of perjury that the foregoing is true and correct. Executed on February 13, 2019 Natalie A. Jaresko Executive Director Financial Oversight and Management Board for Puerto Rico

19 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit A Page 1 of 5 Desc: EXHIBIT A

20 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 José B. Carrión III Chair BY ELECTRONIC MAIL November 26, 2018 Mr. Roberto Maldonado Senado de Puerto Rico Plaza de la Democracia San Juan, PR Exhibit Exhibit A Page 2 of 5 FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO Desc: Members Andrew G. Biggs Carlos M. García Arthur J. González José R. González Ana J. Matosantos David A. Skeel, Jr. Natalie A. Jaresko Executive Director Re: Information requested to review bank account balances and other financial information of the Senado de Puerto Rico ( the Account Holder ) Dear Mr. Roberto Maldonado: In order to understand and evaluate the financial matters of the Government of Puerto Rico, the Oversight Board needs a comprehensive view of the cash position of the Government and its instrumentalities. To further these efforts, pursuant to Section 104(c)(2) of PROMESA, please provide to the Oversight Board the following information: 1. A copy of the chart of accounts, and general ledger or trial balance with the information of the Account Holder s (including their subsidiaries) active bank account(s), which can include unrestricted and restricted cash, and any type of investment accounts, as of June 30, 2018; 2. EIN(s) of the Account Holder as listed in Attachment I; 3. The identity of the financial institution(s) where each of the Account Holder s individual accounts in (1) were maintained as of June 30, 2018; 4. and mailing address for financial institution(s) in (3), as well as the contact information of your principal point of contact in each of the financial institution(s); 5. Account Holder s position regarding which accounts in (1), if any, were designated as restricted as of June 30, 2018; 6. Account Holder s documentation supporting claimed restrictions and the underlying account entries in your books and records on accounts in (1) above on June 30, 2018; PO Box San Juan, PR ; comments@oversightboard.pr.gov

21 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit A Page 3 of 5 Mr. Roberto Maldonado November 26, 2018 Page 2 of 2 Desc: 7. Account Holder s identification, through the provision of documentation or access to same, of the source of funds for accounts claimed as restricted in (6); 8. Account Holder s knowledge of liens claims or encumbrances of any kind which affect the Account Holder s use of account funds identified in (1); and 9. Identity of the source of the funds deposited in each bank account (e.g., appropriations, revenues, fees, or federal funds). In an effort to ensure visibility of the banking relationships in the Commonwealth of Puerto Rico, please send a Form of Consent to each of the financial institution(s) identified in item (3) above, providing the Oversight Board and its advisors all of the financial information maintained at the financial institution(s) regarding the Account Holder s bank accounts identified in item (1) above. For your convenience, a template of the Form of Consent is attached hereto as Attachment II. Please submit an executed copy of the Form(s) of Consent sent to the financial institution(s) together with the other information that will be furnished to the Oversight Board in accordance with this request. Please contact Miguel Tulla or José Gómez from the Oversight Board if you have any questions regarding this matter. We appreciate your cooperation in providing this information to bankaccounts@promesa.gov before end of day on November 30, Sincerely, Natalie Jaresko CC: Ms. Teresa Fuentes Mr. Raúl Maldonado Mr. Christian Sobrino Mr. Omar Rodríguez PO Box San Juan, PR ; comments@oversightboard.pr.gov

22 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit A Page 4 of 5 Desc: Attachment I Information provided to the FOMB indicates that as of June 30, 2018, the Account Holder utilized one or more Employer Identification Number(s) ( EIN or EINs ) as identified below. Kindly confirm that this information is accurate by: Correcting for additional EINs the Account Holder uses but are not identified on Attachment I; and Marking through the EINs that are identified on Attachment I, but the Account Holder does not use. We also indicate on Attachment I who within the Account Holder has been identified as the primary contact in dealings with the Financial Institution: If accurate, no response is required; If a different individual is now the primary contact for the dealings with the Financial Institution, please provide the correct information on Attachment I. EIN Point of Contact Phone Number Roberto Maldonado rmaldonado@senado.pr.gov

23 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit A Page 5 of 5 Desc: Attachment II [Letterhead of Government Entity] [Form of Consent] Date: To: RE: [FINANCIAL INSTITUTION] Request by the Financial Oversight and Management Board regarding financial information of the [ ] (the Account Holder ) Dear [Principal Point of Contact in Financial Institution]: We hereby consent that you provide to the Financial Oversight and Management Board for Puerto Rico ( FOMB ) and its advisors all the financial information of the Account Holder held by your bank, including the following: 1. All cash and investment information held by your institution relating to the Account Holder, including online Web Cash access; and 2. All information about any liens, encumbrances or third party claims which could impact the Account Holder s access to funds in any securities and/or bank accounts in your institution. Information should include accounts held in the name of the Account Holder, as well as accounts held for the benefit of (f/b/o) and custodial accounts where the Account Holder maintains funds held for the benefit of third parties. If you have any questions, please call us at (787) - or us at [ ADDRESS]. Cordially, [To be executed by the Executive Officer of the Entity] Name: Title:

24 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit B Page 1 of 2 Desc: EXHIBIT B

25 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Desc: Exhibit Exhibit B Page 2 of 2

26 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit C Page 1 of 3 Desc: EXHIBIT C

27 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit C Page 2 of 3 Desc: Covered Entities The Financial Oversight and Management Board for Puerto Rico, at its meeting on September 30th, 2016, designated the following entities as initial covered entities subject to oversight under the Puerto Rico Oversight, Management and Economic Stability Act. The list of entities below corresponds to the entities included in the Commonwealth's 2014 Comprehensive Annual Financial Report, adjusted to reflect entities that have been merged, eliminated or created since publication. The component units, subsidiaries or successors of each entity listed below also are designated as covered entities. 1. Commonwealth of Puerto Rico (Primary Government) (1) Service Governing Board 3. Additional (Electronic) Lottery 4. Agricultural Enterprises Development Administration 5. Automobile Accidents Compensation Administration 6. Cardiovascular Center Corporation of Puerto Rico and the Caribbean 7. Commonwealth of Puerto Rico Regional Center Corporation 8. Company for the Integral Development of the Península de Cantera 9. Corporation for the "Caño Martin Peña" Project (ENLACE) 10. Corporation of Industries for the Blind and Mentally Retarded and Incapacitated Persons of Puerto Rico 11. Culebra Conservation and Development Authority 12. Economic Development Bank for Puerto Rico 13. Employees' Retirement System (ERS) 14. Employment and Training Enterprises Corporation 15. Farm Insurance Corporation of Puerto Rico 16. Fine Arts Center Corporation 17. Fiscal Agency and Financial Advisory Authority (AAFAF) 18. Governmental Development Bank for PR (GDB) (2) 19. Institute of Puerto Rican Culture 20. Institutional Trust of the National Guard of Puerto Rico 21. Judiciary Retirement System (JRS) 22. Land Authority of Puerto Rico 23. Local Redevelopment Authority of the Lands and Facilities of Naval Station Roosevelt Roads 24. Model Forest 25. Municipal Revenue Collection Center (CRIM) 26. Musical Arts Corporation 27. Port of the Americas Authority 28. PR Aqueduct and Sewer Authority (PRASA) (3) 29. PR Electric Power Authority (PREPA) (4) 30. PR Highways and Transportation Authority (HTA) 31. PR Infrastructure Finance Authority (PRIFA) 32. PR Maritime Shipping Authority 33. PR Medical Services Administration (ASEM) 34. PR Sales Tax Financing Corporation (COFINA) 35. Public Building Authority (PBA) 36. Public Corporation for the Supervision and Deposit Insurance of Puerto Rico Cooperatives (COSSEC) 37. Puerto Rico and Municipal Islands Transport Authority 38. Puerto Rico Conservatory of Music Corporation 39. Puerto Rico Convention Center District Authority (PRCCDA) 40. Puerto Rico Council on Education 41. Puerto Rico Health Insurance Administration (HIA / ASES) (5) 42. Puerto Rico Industrial Development Company (PRIDCO) 43. Puerto Rico Industrial, Tourist, Educational, Medical, and Environmental Control Facilities Financing Authority (AFICA) 44. Puerto Rico Integrated Transit Authority (PRITA) (6) 45. Puerto Rico Land Administration 46. Puerto Rico Metropolitan Bus Authority (AMA)

28 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Exhibit Exhibit C Page 3 of 3 Desc: 47. Puerto Rico Municipal Finance Agency (MFA) 48. Puerto Rico Ports Authority 49. Puerto Rico Public Broadcasting Corporation 50. Puerto Rico Public Private Partnerships Authority (PPP) 51. Puerto Rico School of Plastic Arts 52. Puerto Rico Telephone Authority 53. Puerto Rico Tourism Company 54. Puerto Rico Trade and Export Company 55. Solid Waste Authority 56. Special Communities Perpetual Trust 57. State Insurance Fund Corporation (SIF) 58. Teachers' Retirement System (TRS) 59. The Children's Trust Fund (CTF) 60. Traditional Lottery 61. Unemployment Insurance Fund 62. University of Puerto Rico (UPR) (7) 63. University of Puerto Rico Comprehensive Cancer Center Footnotes (1) (2) (3) (4) (5) (6) (7) Includes, all departments, offices, programs, etc. and all funds related to Governmental and Business Activities of the Primary Government such as the General Fund Operating Budget and Non-Budgetary Funds. To avoid any confusion, component units of GDB such as Public Finance Corporation (PFC), Housing Finance Authority (HFA), and the Tourism Development Fund (TDF) are specifically listed as covered entities. To avoid any confusion, subsidiaries of PRASA such as PRASA Holdings, LLC and Zumfiber, LLC are specifically listed as covered entities. To avoid any confusion, component units of PREPA such as PREPA Holdings, LLC and Puerto Rico Irrigation Systems are specifically listed as covered entities. The designation of HIA/ASES as a covered entity covers both Proprietary and Agency Funds. To avoid any confusion, component units of PRITA such as Puerto Rico Metropolitan Bus Authority (AMA) and Puerto Rico and Municipal Islands Transport Authority are specifically listed as covered entities. To avoid any confusion, component units of UPR, such as UPR Plaza Universitaria (Desarrollos Universitarios), are specifically listed as covered entities.

29 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Adversary Cover Sheet Page 1 of 2 DPR MODIFIED PROMESA B1040 (FORM 1040) (05/17) Desc: PROMESA COVER SHEET (Instructions on Reverse) PLAINTIFFS (DEBTOR, if Title III Petition; ISSUER, if Title VI Application) THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO, as representative of THE COMMONWEALTH OF PUERTO RICO, et al. ATTORNEYS (Firm Name, Address, and Telephone No.) Miguel E. Gierbolini, Esq. Gierbolini & Carroll, PSC P.O. Box , San Juan, PR miguelgierbolini@gierbolinicarroll.com Tel Cel PARTY (Check One Box Only) X Debtor Creditor Trustee U.S. Trustee/Bankruptcy Admin Other CASE NUMBER (Court Use Only) DEFENDANTS HON. THOMAS RIVERA-SCHATZ (in his official capacity and as a representative of the SENATE OF PUERTO RICO), ATTORNEYS (If Known) PARTY (Check One Box Only) Debtor Creditor Trustee X N/A U.S. Trustee/Bankruptcy Admin Other CAUSE OF ACTION (WRITE A BRIEF STATEMENT OF CAUSE OF ACTION, INCLUDING ALL U.S. STATUTES INVOLVED) NATURE OF SUIT PROMESA Title III Petition PROMESA Title VI Application for Approval of Modifications Other Federal Question Adversary Proceeding Demand $ If Adversary Proceeding is checked, number up to five (5) boxes starting with lead cause of action as 1, first alternative cause as 2, second alternative cause as 3, etc., below: FRBP 7001(1) Recovery of Money/Property FRBP 7001(7) Injunctive Relief 11-Recovery of money/property turnover of 71-Injunctive relief - imposition of stay property 72-Injunctive relief - other 12-Recovery of money/property preference 13-Recovery of money/property fraudulent FRBP 7001(8) Subordination of Claim or Interest transfer 81-Subordination of claim or interest 14-Recovery of money/property other FRBP 7001(2) - Validity, Priority or Extent of Lien 21-Validity, priority or extent of lien or other interest in property FRBP 7001(5) Revocation of Confirmation 51-Revocation of confirmation NAME OF DEBTOR FRBP 7001(9) Declaratory Judgment 91-Declaratory judgment FRBP 7001(10) Determination of Removed Action 01-Determination of removed claim or cause Other X 02-Other (e.g. other actions that would have been brought in state court if unrelated to bankruptcy case) TITLE III CASE IN WHICH THIS ADVERSARY PROCEEDING ARISES THE COMMONWEALTH OF PUERTO RICO CASE NO. 17 BK 3283-LTS DISTRICT IN WHICH CASE IS PENDING DIVISION OFFICE NAME OF JUDGE USDC - PR SAN JUAN LTS

30 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Adversary Cover Sheet Page 2 of 2 DPR MODIFIED PROMESA B1040 (FORM 1040) (05/17) Desc: RELATED ADVERSARY PROCEEDING (IF ANY) PLAINTIFF DEFENDANT ADVERSARY PROCEEDING NO. DISTRICT IN WHICH CASE IS PENDING DIVISION OFFICE NAME OF JUDGE SIGNATURE OF ATTORNEY (OR PLAINTIFF) DATE PRINT NAME OF ATTORNEY (OR PLAINTIFF) THIS FORM IS TO BE USED EXCLUSIVELY FOR FILINGS RELATING TO THE PUERTO RICO OVERSIGHT MANAGEMENT AND ECONOMIC STABILITY ACT (PROMESA). FOR ADMINISTRATION PURPOSES ONLY, THE PUBLIC DOCKETS FOR PROMESA PROCEEDINGS UNDER TITLE III AND ADVERSARY PROCEEDINGS WILL BE MAINTAINED ON THE CASE MANAGEMENT/ELECTRONIC CASE FILING (CM/ECF) SYSTEM OF THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF PUERTO RICO. THESE CASES ARE UNDER THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO.

31 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Summons Page 1 of 2 B2500A (Form 2500A) ( ) Desc: In re: THE FINANCIAL OVERSIGHT AND In re, ) Case No. 17 BK 3283-LTS MANAGEMENT BOARD FOR PUERTO RICO, Debtor ) as representative of ) Chapter PROMESA Title III THE COMMONWEALTH OF PUERTO RICO, et al., ) ) Plaintiff Debtors X ) ) THE FINANCIAL OVERSIGHT AND v. ) Adv. Proc. No. MANAGEMENT BOARD FOR PUERTO RICO, Plaintiff, ) v. ) Defendant ) HON. THOMAS RIVERA-SCHATZ (in his official capacity and as a representative of the SENATE OF PUERTO RICO). SUMMONS IN AN ADVERSARY PROCEEDING HON. THOMAS RIVERA-SCHATZ (in his official capacity and as a representative of the SENATE OF PUERTO RICO) YOU ARE SUMMONED and required to file a motion or answer to the complaint which is attached to this summons with the clerk of the court within 30 days after the date of issuance of this summons, except that the United States and its office s and agencies shall file a motion or answer to the complaint within 35 days. Miguel E. Gierbolini, Esq. Gierbolini & Carroll, PSC P.O. Box San Juan, PR miguelgierbolini@gierbolinicarroll.com Tel Cel If you make a motion, your time to answer is governed by Fed. R. Bankr. P Date:

32 Case: LTS Doc#: Filed:02/14/19 Entered:02/14/19 06:00:06 Summons Page 2 of 2 Desc: CERTIFICATE OF SERVICE I, (name), certify that service of this summons and a copy of the complaint was made (date) by: Mail service: Regular, first class United States mail, postage fully pre-paid, addressed to: Personal Service: By leaving the process with the defendant or with an officer or agent of defendant at: Residence Service: By leaving the process with the following adult at: Certified Mail Service on an Insured Depository Institution: By sending the process by certified mail addressed to the following officer of the defendant at: Publication: The defendant was served as follows: [Describe briefly] State Law: The defendant was served pursuant to the laws of the State of follows: [Describe briefly], as If service was made by personal service, by residence service, or pursuant to state law, I further certify that I am, and at all times during the service of process was, not less than 18 years of age and not a party to the matter concerning which service of process was made. Under penalty of perjury, I declare that the foregoing is true and correct. Date Signature Print Name: Business Address: