NEW YORK (Reuters) - Puerto Rico's infrastructure authority PRIFA did not transfer funds to its bond trustee in order to pay debt due Jan. 1, according to a regulatory filing on Monday, confirming a warning that the U.S. territory gave last week of a pending default.
The embattled Caribbean island said last week that it would pay the bulk of $1 billion debt due Jan. 1 but some bond issues would not be met. The debt due was postponed to Jan. 4 due to the holiday.
The trustee for PRIFA's series 2005 C bonds did not receive funds from PRIFA to pay debt service, although it did receive funds from bond insurer Ambac, the filing said.
Puerto Rico said last week that PRIFA would not have sufficient funds to make the full payment on its special tax revenue bonds, Series 2005A–C and Series 2006, and $36 million was expected not to be paid.
Ambac last week warned Puerto Rico over what it called an illegal plan to take rum tax revenue pledged to PRIFA and use it to meet other financial obligations.
Puerto Rico's Governor Alejandro Garcia Padilla told CNBC earlier on Monday that the island's Department of Justice is trying to anticipate any lawsuits on the island following news of the default.