New Report Suggests Banco Popular de Puerto Rico Could Be Held Liable Over Island’s Final Junk Bond Issuance

Four years after Puerto Rico brought to market what became its biggest and final issuance of junk bonds, a 600-page report by disputes and investigative international law firm Kobre & Kim suggests that Banco Popular de Puerto Rico (BPPR) could potentially be held liable for losses related to the issuance. The findings are part of the efforts of the U.S. territory’s Financial Oversight and Management Board to look into what caused the island’s current financial crisis. To date, Puerto Rico remains in over $120 billion in debt as a result of bond issuances and pension liabilities. Thousands of investors continue to file Puerto Rico bond fraud and closed-end bond fund claims to recover their losses sustained when the securities plunged in value in 2013. According to Kobe & Kim’s findings, while initially both Citigroup (C) and Banco Popular cautioned against yet another junk bond issuance in the wake of the financial challenges Puerto Rico was facing at…

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