- May 17, 2020
- Oppenheimer & Co.
David Krumrey (CRD # 4121845) was a Financial Advisor at Oppenheimer & Co., Inc. in the Woodlands, Texas. David Krumrey has been in the securities industry since 2000 and previously worked at the Stanford Group Co.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), on January 3, 2018, FINRA sanctioned David Krumrey, barring him from associating with a brokerage firm after he failed to cooperate with FINRA’s investigation following his termination from Oppenheimer for “attempting to settle a complaint away from the firm.”
In addition to the FINRA sanction, David Krumrey has been the subject of six customer complaints during his career, alleging sales practice misconduct:
• April 2020—”Claimants allege claims for breach of fiduciary duty, negligence and breach of contract in connection with the management of their account. From 1/1/2016 – 12/31/2017.” Alleged damages are $300,000 and the matter remains pending.
• July 2019—”
CLAIMANT ASSERTS CLAIM OF UNSUITABILITY, BREACH OF FIDUCIARY DUTY, VIOLATION OF STATE SECURITIES LAW, BREACH OF CONTRACT AND NEGLIGENT SUPERVISION IN CONNECTION WITH MAINTENANCE OF CLAIMANT’S ACCOUNTS. FROM 2010 TO 2018.” Alleged damages are $75,000 and the matter remains pending.
• June 2018—”CLAIMANTS ASSERTS CLAIMS FOR BREACH OF FIDUCIARY DUTY, VIOLATION OF STATE SECURITIES LAW, FRAUD, BREACH OF CONTRACT, NEGLIGENCE, NEGLIGENT MISREPRESENTATION AND NEGLIGENT SUPERVISION IN CONNECTION WITH THE MAINTENANCE OF THEIR ACCOUNT. FROM 2009 TO 2018.” The matter was settled for $150,000.
• February 2018—”Krumrey was a subject of the customer’s complaint against Oppenheimer & Co., Inc. that asserted the following causes of action: Breach of Fiduciary Duty, Negligence, Negligent Supervision, Respondeat Superior, Unjust Enrichment, and Violations of the Louisiana Securities Law.” The matter went to a final hearing and the panel awarded the customer $250,000.
• October 2017—”CLAIMANT ALLEGES NEGLIGENCE, BREACH OF FIDUCIARY DUTY, NEGLIGENT SUPERVISION, AND BREACH OF CONTRACT RELATED TO ENERGY INVESTMENTS. FROM 2009 TO 2013.” The matter was settled for $30,000.
• August 2017—”Client alleges that unauthorized transactions took place in his account. No time period specified, but client mentions May 2014 as when his account began being handled.” The matter was settled for $35,000.
A For a full copy of David Krumrey’s FINRA disclosure report, click https://brokercheck.finra.org/individual/summary/4121845#disclosuresSection
Financial advisors have a legal and regulatory obligation to recommend only suitable investments that are appropriate for their clients’ needs and objectives. Their employing brokerage firm has a legal and regulatory obligation to supervise the Financial Advisors’ sales practices and dealings with clients. To the extent any of these duties are breached, the customer may be entitled to a recovery of his or her investment losses.
Reasonable basis suitability requires that a recommended investment or investment strategy be suitable or appropriate for at least some investors. Reasonable basis suitability requires an advisor to conduct adequate due diligence so that he or she can determine the risks and rewards of the investment or investment strategy.
Quantitative suitability requires a brokerage firm or financial advisor with actual or de facto control over a customer’s account to have a reasonable basis for believing that a series of recommended transactions – even if suitable when viewed in isolation – is not excessive and unsuitable for the customer when taken together in light of the customer’s investment profile. No single test defines excessive activity, but factors such as the turnover rate, the cost-equity ratio, and the use of in-and-out trading in a customer’s account may provide a basis for a finding that a member or associated person has violated the quantitative suitability obligation.
Customer-specific suitability requires that a member or associated person have a reasonable basis to believe that the recommendation is suitable for a particular customer based on that customer’s investment profile. Among the criteria that a financial advisor must evaluate to satisfy his or her customer-specific suitability obligations include the investor’s:
• Other investments
• Financial situation and needs
• Tax status
• Investment objectives
• Time horizon
• Liquidity needs
• Risk tolerance
• Any other information disclosed by the customer
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