Syncora Opposes Forcing Jefferson County to Pay Warrants
Source: Bloomberg
Syncora Guarantee Inc. objected to a request on behalf of creditors of Jefferson County, Alabama, that would force the bankrupt county to make immediate payment on about $792 million of its sewer warrants.
Syncora, a bond insurer, said in a filing yesterday in U.S. Bankruptcy Court in Birmingham that a group of creditors, who bought the warrants at a discount and who have refused to forbear from receiving principle payments on warrants that can be mandatorily redeemed, are trying to exert pressure on the company and other insurers of the bonds.
“Disturbing the status quo, and trying to coerce the insurers to suffer near-term exposure that would otherwise be resolved pursuant to a plan of adjustment will do nothing for achieving consensus,” Syncora said in the filing.
The Bank of New York Mellon Corp., the trustee for Jefferson County’s $3.2 billion in sewer bonds, last month sought a judge’s ruling it’s entitled to seek accelerated payment on the county’s debt.
Read more: http://www.bloomberg.com/news/2013-03-23/syncora-objects-to-forcing-jefferson-county-to-pay-warrants-1-.html
I'm shocked that an insurance company would refuse to pay a claim.
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The "investors" represented by Mellon are the vultures. They bought the warrants (debt) for pennies on the dollar and now it's time to clean up by getting the bankruptcy court to rule in their favor and receive full principle.
Of course Jeff county can't pay $792M immediately, so in reality they're asking for a chunk of Syncora. Well, I don't have a lot of sympathy for Syncora either. They're the insurer. THEY'RE SUPPOSED to be experts in gagging and managing risk.
The thing that pisses me off the most, though, is no matter how catastrophic a situation or how many people get hurt, there's always jerks angling to make a buck off it. These people would short sell their mothers as soon as they found out she's got cancer. 
Shocked, I tell you!! They made a bet and lost, and now the don't want to pay up. Never could have seen that coming.