RCS Capital to Continue Its Bankruptcy

Posted on April 21st, 2016 at 1:37 PM
RCS Capital to Continue Its Bankruptcy

From the Desk of Jim Eccleston at Eccleston Law LLC:

RCS Capital has announced that it will continue on with its bankruptcy filing.  Overcome with debt, RCS Capital Corp., or RCAP, filed for a pre-arranged Chapter 11 filing at the end of January as part of an agreement reached with a majority of its lenders.  This filing aims to eliminate hundreds of millions of dollars of debt. Cetera Financial Group, which is a broker-dealer holding company of RCAP, is expected to emerge as an independent company following the bankruptcy.

Particular holding companies of the broker-dealers within the Cetera network of 9,100 advisors are guarantors of RCAP’s debt.  RCAP will include those entities in a subsequent pre-packaged Chapter 11 filing in federal bankruptcy court in order to eliminate the guarantees without impairing any other aspect of the business.  Cetera’s broker-dealers and registered investment advisor firms will not be involved in that Chapter 11 filing.

Larry Roth, Cetera Financial Group chief executive officer, stated “We are excited about this important step forward, which puts us in the home stretch to complete our transformation into a Cetera-only organization that is independent, well-capitalized and privately owned.”

First and second lien holders will become the majority owners of the company that emerges after restructuring.  Those members include large institutional investors and financial institutions.  It is of note that the restructured Cetera Financial Group will have no relationship with former nontraded real estate “investment trust czar” Nicholas Schorsch or his partners. 

The attorneys of Eccleston Law LLC represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.

Related Attorneys: James J. Eccleston

Tags: Eccleston, Eccleston Law, Eccleston Law LLC, James Eccleston

Return to Archive

TESTIMONIALS

Previous
Next

This was the best of all possible outcomes and I cannot thank you and the team enough.

Michael S.

LATEST NEWS AND ARTICLES

September 20, 2023
SEC Orders Legendary Capital Founder and REIT Advisors to Pay Nearly $5 Million

Corey Maple, co-founder of non-traded REIT sponsor Legendary Capital, has agreed to a $100,000 civil penalty to settle charges brought by the Securities and Exchange Commission (SEC).

September 19, 2023
Reg BI Violations Lead to FINRA's Fine on Another Broker-Dealer

The Financial Industry Regulatory Authority (FINRA) has fined and censured broker-dealer Network 1 Financial Securities and its chief compliance officer for violating Regulation Best Interest (Reg BI).

September 18, 2023
Troubles at an Arizona Park Funded by Municipal Bonds Are a Warning to Investors

The recent financial troubles at a sports arena in Mesa, Arizona, demonstrate that not all municipal bonds are equally safe.