Investigating Potential Claims – EXCO Resources Inc.
The White Law Group is investigating potential claims involving broker dealers who may have unsuitably recommended EXCO Resources to investors.
According to the website, EXCO Resources is an independent oil and natural gas company engaged in the exploitation, exploration, acquisition, development and production of onshore U.S. oil and natural gas properties with a focus on shale resource plays.
The company often raises capital through Reg D private placements. The trouble with Reg D Private Placements, like EXCO Resources, is that they involve a high degree of risk. They are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds.
An additional risk inherent to EXCO offerings is also the general risk that comes with the energy market. The energy market has seen enormous losses over the last few years due to the declining cost of oil and other energy commodities. These investments may seem wise at first, until the dramatic drop in distributions.
Many oil and gas LPs are struggling to make distribution payments and some may end up defunct.
Alternative investments such as these, have high sales commissions and due diligence fees. These high commissions and fees can provide brokers with an enormous incentive to push the product to unsuspecting investors who do not fully understand the risks. They may even focus on the income potential and tax benefits while downplaying the risks.
Is this a suitable investment for you?
The White Law Group is investigating the liability that brokerage firms may have for improperly selling oil and gas investments like EXCO Resources to investors.
Broker dealers that sell private placements are required to perform adequate due diligence on all investment recommendations. They must ensure that each investment recommendation that is made is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.
If a broker or brokerage firm makes an unsuitable investment recommendation or fails to adequately disclose the risks associated with an investment they may be found liable for investment losses in a FINRA arbitration claim. Fortunately, FINRA does provide for an arbitration forum for investors to resolve such disputes.
Free Consultation with a Securities Attorney
If you suffered losses investing in EXCO Resources or another private placement investment, the securities attorneys at The White Law Group may be able to help you. Please call The White Law Group at 1-888-637-5510 for a free consultation.
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 Franklin, Tennessee. The firm represents investors throughout the country in claims against their brokerage firm.
For more information on the firm and its representation of investors, visit www.WhiteSecuritiesLaw.com.