Erez Law is currently investigating former Oppenheimer & Co. Inc. broker David Krumrey (CRD# 4121845) regarding exchange-traded notes (ETNs), oil and gas securities, and VXX investment losses. Krumrey was registered with Oppenheimer & Co. Inc. in The Woodlands, Texas from 2009 to 2017, when he was terminated regarding, “Mr. Krumrey was terminated for attempting to settle a complaint away from the firm.”
iPath S&P 500 VIX Short-Term Futures ETN (VXX) is an inverse volatility-linked exchange-traded fund that hit some market volatility in February 2018, causing the Chicago Board Options (CBOE) Volatility Index (VIX) Index to rise rapidly, and the VXX to lose value. Inverse volatility-linked ETFs return a profit when the market experiences periods low volatility. This is an extremely complex and risky security that is not suitable for the average investor, hedging a bet that the market will remain relatively stable. Some inverse ETFs are designed to provide investors with positive returns when the VIX falls, and inversely negative when the VIX rises. The VIX Index is referred to as a fear gauge for the market.
In April 2018, FINRA barred Krumrey after he failed to respond to FINRA’s request for information.
Krumrey has been the subject of six customer complaints in 2017 and 2020, according to his CRD report:
- 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.” The customer is seeking $300,000 in damages. The complaint was regarding common and preferred stocks, VXX, and oil and gas securities.
- 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.” The case was settled for $75,000. The case was regarding common and preferred stocks and VXX.
- 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 customer sought $250,000 in damages and the case was settled for $150,000. The complaint was regarding VXX.
- 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 customer was awarded $574,829 in damages. The complaint was regarding exchange-traded notes (ETNs).
- October 2017. “Claimant alleges negligence, breach of fiduciary duty, negligent supervision, and breach of contract related to energy investments. From 2009 to 2013.” The customer is seeking $200,000 in damages and the case was settled for $30,000. The complaint was regarding oil and gas securities.
- 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 customer sought $91,000 in damages and the case was settled for $35,000. The complaint was regarding common and preferred stocks.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, Oppenheimer & Co. Inc. may be liable for investment or other losses suffered by Krumrey’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.
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