Puerto Rico Electric Power Authority (PREPA) has signed its 12th extension to restructure $8.3 billion of debt. According to Yahoo Finance, “Investors holding about 35 percent of the Puerto Rico Electric Power Authority’s debt decided to delay until next week the expiration of a forbearance agreement that was set to end Friday.”
The extension coincides with the possible signing of tentative agreement made with PREPA back in September. The potential agreement would involve investors taking a 15% loss in a debt exchange.
Furthermore, Yahoo Finance reports , PREPA is negotiating with insurance companies that will guarantee repayment of about $2.5 billion of the debt. However, talks remain private while investors are left hanging in the balance.
Puerto Rico has been struggling with municipal debt for several years. With approximately $70 billion in outstanding debt, if Puerto Rico defaults, it will be the largest of its kind.
The White Law Group continues to investigate the liability that brokerage firms may have for recommending municipal bond funds with a high exposure to Puerto Rican debt.
Broker-dealers are required by securities law and industry regulations to adequately disclose the risks associated with all investment recommendations, and to perform the necessary due diligence to determine if the investment is suitable for each individual client based on risk tolerance, investment experience, liquidity needs, net worth and financial objectives. When broker-dealers violate securities laws and regulations they can be liable for investment losses.
If you are concerned about your investment in a Puerto Rico debt and would like to speak to a securities attorney about whether you have a potential FINRA dispute resolution claim, please call The White Law Group’s Florida office at 312-238-9650 for a free consultation.
Dedicated to the representation of investors in FINRA arbitration claims, The White Law Group, LLC is a national securities fraud law firm with offices in Chicago, Illinois and Vero Beach, Florida.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Vero Beach, Florida.
For more information on The White Law Group, please visit our website at www.whitesecuritieslaw.com.