❓WHAT HAPPENED: The Trump administration dismissed five of seven members from Puerto Rico’s federal control board, sparking concerns over the island’s financial future due to potential board malfeasance.
👤WHO WAS INVOLVED: The White House, dismissed board members Arthur Gonzalez, Cameron McKenzie, Betty Rosa, Juan Sabater, Luis Ubiñas, and remaining members Andrew G. Biggs and John E. Nixon.
📍WHEN & WHERE: The dismissals were announced Tuesday, affecting Puerto Rico’s federally appointed financial oversight board.
💬KEY QUOTE: “It’s time to restore common sense leadership,” said a White House official, citing inefficiency and secrecy within the board.
🎯IMPACT: The move raises questions about the board’s future and Puerto Rico’s ongoing financial restructuring efforts.
The Trump administration has removed five of the seven members of Puerto Rico’s federally appointed financial oversight board, raising alarms over the island’s economic recovery and governance. The board, established by Congress in 2016 to manage the U.S. territory’s public finances, has been overseeing efforts to restructure tens of billions in debt following years of financial mismanagement.
The dismissed members, all Democrats, included board chair Arthur Gonzalez, along with Cameron McKenzie, Betty Rosa, Juan Sabater, and Luis Ubiñas. Remaining on the panel are Andrew G. Biggs and John E. Nixon, both Republicans.
A White House official justified the dismissals by accusing the board of operating inefficiently and lacking transparency, saying it “has been run inefficiently and ineffectively by its governing members for far too long and it’s time to restore common sense leadership.”
The official also criticized the board’s spending, citing excessive consulting and legal fees as well as “exorbitant salaries to staff.” According to the same official, the decision reflects dissatisfaction with the board’s progress, which the administration believes has “prolonged Puerto Rico’s bankruptcy.”
During the Obama administration, the Financial Oversight and Management Board (FOMB) was created under the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). At the time, the island had declared it could not repay its more than $70 billion in public debt, triggering the largest municipal bankruptcy in U.S. history. Currently, Puerto Rico continues to face significant hurdles, particularly with the restructuring of $9 billion in debt held by the Puerto Rico Electric Power Authority (PREPA), a process mired in legal disputes with creditors seeking full repayment.
The dismissals will likely face legal challenges. However, Puerto Rico bond expert Cate Long argues there are clear grounds for the for-cause dismissals. “The level of the Puerto Rico OBoard’s incompetence is evident to people on both sides of the aisle. Ask yourself how they could pay their executive director, Robert Mujica, $625,000 [a year] while the US president only makes $400,000 [a year],” Long wrote in a post on X (formerly Twitter). She added: “Meanwhile, the OBoard allowed Mujica to moonlight for the Greater New York Hospital Association and Mets owner Steve Cohen. This, while the [Puerto Rico] electric utility was on its knees.”
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