June 21, 2016 Comments (0) Blog, Current Investigations

Investor Alert: Exco Resources

(Last Updated On: April 6, 2017)

Have you suffered losses investing in Exco Resources bonds? If so, The White Law Group may be able to help.

EXCO Resources, Inc. is an independent oil and natural gas company engaged in the exploration, exploitation, development and production of onshore the United States oil and natural gas.

According to Marcellus Drilling, in May the company announced it was looking at “restructuring,” which is typically a code word for bankruptcy, and the company’s stock took a nosedive. Not long after, EXCO announced it was firing some board members, hiring new ones, and aggressively hammering midstream companies to lower pipeline costs.

High-yield bonds—also called non-investment-grade bonds, speculative-grade bonds, or junk bonds—are bonds that are rated below investment grade, typically ‘BB’ or lower by Standard & Poor’s and ‘Ba’ or lower by Moody’s. They pay high yields to bondholders because the borrowers credit ratings are less than pristine, making it difficult for them to acquire capital at an inexpensive cost. Junk bonds carry an above average risk that the issuer will default on the bond. The increased risk makes them arguably unsuitable for many investors.

Brokerage firms that sell such products are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives. Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.

Specifically, The White Law Group is investigating the following Exco Resources investments:

EXCO Resources 8.5% 15apr2022

EXCO Resources 7.5% 15sep2018

High-yield bonds—also called non-investment-grade bonds, speculative-grade bonds, or junk bonds—are bonds that are rated below investment grade, typically ‘BB’ or lower by Standard & Poor’s and ‘Ba’ or lower by Moody’s. They pay high yields to bondholders because the borrowers credit ratings are less than pristine, making it difficult for them to acquire capital at an inexpensive cost. Junk bonds carry an above average risk that the issuer will default on the bond. The increased risk makes them arguably unsuitable for many investors.

Brokerage firms that sell such products are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives. Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.

If you suffered losses investing in Exco Resources bonds and would like a free consultation with a securities attorney, please call The White Law Group at 888-637-5510.

The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. For more information on The White Law Group, visit http://www.whitesecuritieslaw.com.