Oppenheimer & Co.

Kurta Law is investigating recommendations made by Oppenheimer brokers. Investors should review their account statements and consider contacting a securities attorney if they discover any surprising losses. Investing always comes with some risk, but brokers are required to exclusively recommend investments that suit their customer’s risk tolerance.

Background Information

Brokerage firms are required to disclose certain regulatory matters, including regulatory actions and civil suits. According to the firm’s BrokerCheck record, there are 282 disclosures on Oppenheimer’s record, including 100 regulatory events.

Investors should also know that the firm employs representatives who have allegations of misconduct on their records.

Investors should know that Oppenheimer has done business under the following names:

• Carolan Division of Oppenheimer & Co.
• Reparian Partners
• Division of Oppenheimer & Co.
• Pearl Street Investment Management
• Omega Services Program
• Newbold’s Investment Advisors
• First of Michigan Division
• Fahnestock Asset Management
• Edward A. Viner & Co.
• Cranbook Capital Management

Oppenheimer has its main address in New York, New York. 

Oppenheimer Brokerage Services

Oppenheimer is registered as both a brokerage firm and an investment advisory firm. Brokerage accounts do not offer monitoring and charge fees on a per-transaction basis. Investment advisory firms charge fees that are typically a percentage of the total assets under management. You can read more about the differences between advisory accounts and brokerage accounts in the Customer Relationship Summary (Form CRS).

Oppenheimer is also an investment bank that works with corporations and other institutional customers.

The firm offers a variety of investment products, including the following:

• Domestic and international equities
• Options
• Fixed-income securities
• Mutual funds
• Exchange-traded funds
• Unit Investment Trusts
• Proprietary and third-party alternative investments

Brokerage Account Fees

Learn what fees the firm charges and how those fees may create a conflict of interest.

• Transaction-based fees, also known as “commissions.” These fees create an incentive for brokers to encourage you to trade more often.
• “Principal” trades are securities that the firm sells from or buys for its own accounts. This means that Oppenheimer has an incentive to encourage you to trade with the firm as a principal rather than executing trades with other market participants.
• Mutual funds may come with sales loads, which are fees investors either pay when they first purchase an investment or when they sell their shares.
• Mutual funds, variable annuities, and Unit Investment Trusts impose fees that will reduce the value of the investments over time.
• Oppenheimer may also charge custodial, administrative, and other service fees.
• Certain products may offer more of a payment for either the brokerage firm or the representative.

Investors should know that Financial professionals can discount advisory fees and brokerage account commissions within certain guidelines. These discounts reduce their commissions, so they may not offer.

Regulatory Actions

You can review the full list of regulatory actions on the detailed BrokerCheck record. Out of the 100 regulatory actions on this firm’s record, Kurta Law wants investors to take special note of the following:

$12 Million SEC Fine

On February 9, 2024, the Securities and Exchange Commission alleged that it had discovered recordkeeping failures during the course of multiple investigations. Senior management, managing directors, and other Oppenheimer employees allegedly failed to comply with Oppenheimer’s policies by communicating on their personal devices about broker-dealer business.

Oppenheimer’s alleged recordkeeping failures allegedly impacted the SEC’s ability to carry out its regulatory functions and investigate alleged violations of federal securities laws.

FINRA Rule 4511

Rule 4511 requires firms to make and preserve books and records that they can present to regulators as requested. To adhere to this rule, representatives must use official communication channels.

SEC Fine

The SEC ordered Oppenheimer to cease and desist and imposed a civil penalty of $12 million.

Allegations of Cost Basis Misrepresentations

According to an Acceptance, Waiver, and Consent agreement (AWC) dated April 22, 2021, Oppenheimer allegedly misrepresented cost basis information on more than 1,000 account statements and Forms 1099. AWCs allow firms to consent to entries on their records without admitting or denying the findings.

The cost basis states the original value of an asset, prior to any losses or returns.  This number is essential to determine the profit or loss that an individual must report on their taxes. In at least one case the firm allegedly adjusted the cost basis in order to reduce a customer’s capital gains.

Terms of the AWC

As part of the terms of the AWC, the firm consented to a censure and a fine of $525,000.

Unit Investment Trusts and $800,000 FINRA Fine

An AWC filed on November 6, 2020, alleges that Oppenheimer failed to supervise its representatives’ recommendations of Unit Investment Trusts. According to the allegations, the firm’s failure to supervise allowed a representative to engage in short-term trading of Unit Investment Trusts (UITs). UITs have specified maturity dates, and if investors sell their UITs in order to buy new UITs, they may end up paying unnecessary sales charges.

The AWC alleges that Oppenheimer executed more than $6.4 billion in UIT transactions during the relevant period, which allegedly generated more than $68.6 million in sales charges.

FINRA Supervisory Rules

FINRA Rule 3110 requires that firms establish systems of supervision to maintain their compliance with securities regulations. This includes supervision of UIT recommendations.

Terms of the AWC

As part of the AWC, Oppenheimer consented to a fine of $800,000 and a restitution payment of $3.8 million to its customers.

Oppenheimer in the News

In 2024, a former Oppenheimer broker named John Woods was sentenced to eight years in prison for running an alleged Ponzi scheme. The scheme allegedly defrauded 400 investors of over $110 million. The SEC alleges that Oppenheimer took steps to conceal his illegal “private equity fund” by allowing Woods to “quietly resign” from Oppenheimer without reporting his allegedly illegal activities to regulators.

Disciplinary Records of Representatives

The form CRS recommends that investors ask: “As a financial professional, do you have any disciplinary history? For what type of conduct?”

Allegations of Misconduct

Kurta Law is aware of numerous allegations of misconduct against Oppenheimer brokers. This is just a short selection.

• One broker faced allegations of fraud involving municipal bonds, private equity investments, and the use of margin. The investor is seeking $2.5 million.
• Another broker faced a six-figure dispute alleging he executed excessive transactions, falsified account documentation, and engaged in unauthorized trading.
• Kurta Law is aware of at least two other disputes alleging Oppenheimer brokers made unsuitable recommendations involving margin accounts:
• This dispute alleges an Oppenheimer broker engaged in negligence and fraud, in addition to excessive trading in margin accounts.
• Another dispute has similar allegations.

What Can I Do If I Lost Money with an Oppenheimer Broker?

If you believe you lost money due to broker fraud or misconduct, contact a securities attorney. Our attorneys offer free case evaluations and do not collect a fee unless they win your case. Call (877) 600-0098 or email info@kurtalawfirm.com.