U.S. Federal Judge Thomas Griesa has scheduled the Argentina government for a contempt hearing on Monday in New York over its failure to follow a court order to pay off hold-out hedge fund owners.

The hedge fund owners, popularly known as "vulture funds", are asking the judge to hold Argentina in contempt, and fine the country $50,000 a day.

"A contempt ruling probably won't help resolve the situation," said Eric LeCompte, executive director of Jubilee, USA. "The case continues to highlight how ineffective the U.S. courts are at resolving debt disputes."

Hold-out investors refused to settle a restructuring debt deal with Argentina after it defaulted on loans in 2001. Ninety-two percent of the bondholders accepted a 70 percent cut on the face value of their bonds, but hold-out investors refused.

Hold-out investors U.S. billionaire Paul Singer's NML Capital and U.S.-based Aurelius Capital Management took Argentina to court, and on July 30, 2014, Judge Griesa ordered the country to pay them the full $1.3 billion due.

The judge also froze money Argentina had deposited in the Bank of New York Mellon, $539 million, to pay the bondholders who had accepted the restructuring deals in 2005 and 2010. That action caused international credit rating firms to declare Argentina in default again in July.

In a controversial move on Sept. 11, Argentine lawmakers passed a measure that would allow the country to sidestep the U.S. court order and make repayments through Buenos Aires or Paris.

The country has to make good on debt payments of $200 million by Sept. 30, according to AFP.

In a vote on Friday, the United Nations Human Rights Council passed a resolution in Geneva condemning the group of American hedge funds that took Argentina to court.

"The vulture funds will not stop unless we stop them ourselves," Foreign Minister Hector Timerman told the council before the vote. "The billions that these vulture funds grab in countries in the south lead to school closures, hospitals without medicines, political instability, insecurity and violence," he said.

The resolution was tabled by Argentina, along with Russia, Brazil, Venezuela and Algeria. The resolution condemned the activities of vulture funds, and regretted the effect debt payment to such funds has on the capacity of governments to fulfill their human rights obligations.

The American representative at the council, Keith Harper, said the text was unacceptable.

"The state's responsibility for promoting and protecting human rights and fundamental freedoms is not contingent on its sovereign debt situation," he said.

The resolution was approved by 33 votes to five, with nine countries abstaining. The United States, Britain, Germany, Japan and the Czech Republic voted against.