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Fidelity Prevails in Suit Over Investment Costs, Robo-Adviser Fees

"Fidelity Management Trust Co. and a subsidiary defeated a lawsuit by participants in Delta Air Lines Inc.'s retirement plan challenging alleged high-cost investment options and certain financial advisory fees. The participants failed to show that Fidelity exercised a fiduciary function over which share classes would be available to them through the brokerage account that would give rise to liability under [ERISA] ... The plan documents show that once Delta chose to include a brokerage account, Fidelity was bound to follow the participants' investment instructions and exercised no discretion or authority with respect to which shares they elected to buy[.]" [Fleming v. Fidelity Management Trust Co., No. 16-10918 (D. Mass. Sept. 22, 2017)]

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Fidelity Sued Anew Over 401(k) Fees, Investment Strategy

"According to the complaint, Fidelity responded to losses incurred during the 2008 financial crisis by adopting an overly conservative investment strategy meant to appease the company's 'wrap providers' -- which include AIG Financial Products, JP Morgan Chase Bank and State Street Bank -- at the expense of the workers investing in one of Fidelity's stable value funds. Fidelity then attempted to conceal these missteps by reporting a misleading benchmark that made the fund look more competitive than it actually was, the complaint alleged. Fidelity also charged excessive fees in connection with the fund and allowed its big-bank wrap providers to more than double their fees, the complaint alleged."

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Fidelity Investments Yields the Small 401(k) Plan Market to Its RIAs

"Fidelity Investments, the powerhouse 401(k) provider, will no longer compete with RIAs in the small and midsize 401(k) plan arena, says Ted Madden, senior vice president, sales for Fidelity. This is a major move that shows RIAs have become a major force in that arena, industry leaders say.... The actions of Fidelity make sense and deserve applause but they are likely the result of Fidelity finding it more difficult to beat RIAs -- making the choice to join them easier, according to Doug Dannemiller, principal of Duxbury, Mass.-based Dannemiller Analytics & Consulting LLC."

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Fidelity Investments Annual Report on State of 401(k) Industry (PDF)

Excerpt: Building Futures is Fidelity Investments' annual report on the state of the 401(k) industry. Volume VIII provides a comprehensive analysis of over 10 million participants in nearly 13,000 corporate defined contribution (DC) plans administered by Fidelity at the end of 2006, representing $674 billion in assets. The full report will be published this fall.  MORE >>

Comments of Fidelity Investments to SEC on Duties of Brokers, Dealers and Investment Advisers (PDF)

"If the Commission believes that rulemaking in this area is necessary, Fidelity supports a uniform fiduciary duty that would require broker-dealers and investment advisers to act in the best interest of retail customers when offering personalized investment advice about securities to such retail customers.... We believe that the existing principles-based fiduciary duty under the Advisers Act has worked well for investment advisers and their clients and we see no reason to modify this well functioning model."  MORE >>

Fidelity Investments Wins Huge in the 'Biggest 401(k) Case in Decades'

"This case validates the DOL's message that employers need to look more carefully at fees, says Fred Reish, an attorney with Drinker Biddle & Reath LLP.... Even though Fidelity is off the hook in this case for fees, Reish questions whether recordkeepers could get fined for excessive fees in the future.... But in this ABB case, the court didn't question Fidelity for its recordkeeping fees. Instead, the court determined that ABB failed to complete its due diligence for the recordkeeping fees paid to Fidelity. In addition, ABB didn't benchmark its recordkeeping fees." [Tussey v. ABB, Inc., No. 12-2056 (8th Cir. Mar. 19, 2014)]  MORE >>

Fidelity Investments Is Suddenly Fending Off a Fresh Wave of AI Suitors for Its Vast Recordkeeping Data Trove

"Money can't buy petabytes of client data -- at least at Fidelity Investments, which owns eight of them, and claims it's swatting back offers from corporate giants and start-ups alike to buy its records.... The Boston broker-dealer and record-keeper, with roughly $3.2 trillion in pension assets, is playing hard to get -- or at least coy -- with access to raw data in its digital vaults going back decades[.]"  MORE >>

Fidelity Investments Debuts Bitcoin Trades

"Fidelity Investments is plunging deeper into the crypto black hole, but a bright light may be at the end of the tunnel -- a chance to steamroll all other crypto brands and dominate the industry. The $9.9-trillion Boston firm is executing its first Bitcoin retail trades as crypto players large and small disintegrate, Capitol Hill lawmakers decry its participation and tokens plummet in value."

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Fidelity Investments Changes How It Manages Its $170 Billion of Target Date Funds

"Fidelity explains the surprising shift in its long-held conservative allocation by saying it reflects deep research into the reams of data at its fingertips -- not only as the biggest player in target date funds with $175 billion of assets but also as the 401(k) king. This includes findings that investors have more of a stomach for risk than realized based on 2008 behaviors and that investors start investing sooner and live longer than previously thought."  MORE >>

How Exactly Fidelity Investments Extracted Itself from a Legal and HR Quagmire

"[T]he lingering conflict here is that Fidelity is making some major league changes in how it manages the 401(k) plan of its employees. But it refuses to admit to an iota of wrongdoing.... [A] deeper look at true economic value of this deal suggests it could increase the nest eggs of employees by hundreds of millions over time as Fidelity eats more plan costs and goes bigger on its matching contributions."

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What to Make of DOL's Backtrack After John Kerry, Fidelity Investments and the Rest of the Riled 401(k) Industry Cried Foul

"It all came down to the Department of Labor's willfulness versus the full force and fury of the 401(k) industry -- and some its powerful allies -- and guess who won? (Hint: The winners are at a higher pay scale and deal with real investors.) In May, the 401(k) industry was angered after its members believe they were blindsided by an eleventh-hour move by the DOL requesting that some self-directed brokerage accounts receive the same level of monitoring as other investments in 401(k) plans.... Now, it appears that the DOL has come around to the viewpoint of these record keepers and discount brokers. The rule maker for 401(k) plans announced on Monday that it will resume the policy position of allowing plan participants to pick and choose their own investments at their own peril and not require plan sponsors to monitor them in the same way as they would other investments."

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Letter from Senators to Fidelity Questioning Bitcoin Investment Policy (PDF)

"While plan sponsors ultimately are responsible for choosing the investments available to participants, it seems ill-advised for one of the leading names in the world of finance to endorse the use of such a volatile, illiquid, and speculative asset in 401(k) plans -- which are supposed to be retirement savings vehicles defined by consistent contributions and steady returns over time."  MORE >>

Here's What Could Go Wrong with Fidelity Investments Adding Bitcoin to Your 401(k)

"[If] offering people the ability to invest in crypto boosts overall retirement savings, that's good.... Cryptocurrency isn't ready for prime time. It's unregulated. It doesn't provide protection for consumers. Consumer disclosure rules and regulations are limited or nonexistent.... The Consumers have reported losing more than $80 million to cryptocurrency investment scams[.]"

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Fidelity Dismissed from Verizon Plan Investments Suit

"Although the court dismissed claims regarding risky investments in TDFs and participant fee disclosure failures, Verizon still faces a charge regarding an underperforming investment." [Jacobs v. Verizon Communications, Inc., No. 16-1082 (S.D.N.Y. Sept. 28, 2017)]

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Fidelity Backs Away from Being 'Point in Time' Fiduciary for 401(k) Plans

"Fidelity Investments no longer will serve as a fiduciary when it helps employers select investments for their 401(k) plans, moving away from a policy the firm adopted last year in response to the [DOL's] fiduciary rule.... Fidelity was the only record keeper that said it would adapt by providing services as a fiduciary under the new regime ... However, given the DOL rule's fate, the level of investment guidance is again considered non-fiduciary under ERISA, and Fidelity has distanced itself from the 'fiduciary' label as a result."  MORE >>

Fidelity Files Motion to Dismiss Lawsuit Over In-House Plan

"Fidelity makes the following non-exhaustive list of legal and factual arguments: [1] Plaintiff lacks constitutional standing to bring her claims because she was only invested in a small sub-set of a much larger group of Fidelity funds in the plan.... [2] Fidelity offered free advice to all participants to help them pick from the plan's lineup. [3] Between 2007 and 2011, Fidelity contributed $2.1 billion in employer contributions, which purportedly amounts to 10 times the alleged amount of excessive fees paid back to Fidelity from the plan's investments. [4] Prohibited Transaction Exemption 77-3 expressly allows a company like Fidelity to use its own mutual funds."

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Fidelity Unit Warns of 'Massive Outages Across Major Fidelity Platforms,' in New Lawsuit

"Fidelity Technology Group is suing and seeking an injunction against the Palo Alto software maker in a festering contract dispute to prevent dire outcome that would stop most RIA client servicing in its tracks.... Broadcom Inc., a key Fidelity Investments software provider, is threatening to pull the plug on Fidelity's computers two months from now, creating a massive blackout for RIAs, clients and the company itself." [Fidelity Technology Group, LLC v. Broadcom Inc., No. 2584CV03035 (Mass. Sup. Ct. complaint filed Nov. 3, 2025)]  MORE >>

Fidelity, Centene Face ERISA Suit Alleging Excessive Fees, Misused Forfeitures

"According to the complaint, Fidelity's recordkeeping services to the ... plan created a conflict of interest because its affiliate, Fidelity Management Trust Co., served as trustee of the plan's assets, while Fidelity's separate affiliate, Strategic Advisors, served as investment advisers to the plan. The complaint alleges that Fidelity charged participants between $39 and $50 in annual administrative costs for the 2019 through 2023 plan years ... [while] comparable plans using Fidelity had costs of about $3 to $31 per participant[.]" [Clark v. Centene Corp., No. 25-09743 (C.D. Calif. complaint filed Nov. 12, 2025)]  MORE >>

DOL Proposal Would Have Hobbled Recent Help for Investors, Fidelity Says

"On Aug. 24, when the Dow Jones Industrial Average briefly plummeted more than 1,000 points in the first six minutes of trading, the volume of calls to Fidelity Investments' toll-free numbers was 50% higher than for a typical summer Monday.... Phone representatives generally urged investors with a long-term investment plan to 'stay the course.' But if a controversial proposal from the U.S. Labor Department had been in place, [said John Sweeney of Fidelity Investments,] call-center representatives at Fidelity and other companies would have been far more restricted in what they could say after the initial 'don't panic' to customers calling about 401(k) plans and other retirement accounts."

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Putnam, Fidelity Win 401(k) Lawsuits

"A federal judge shot down plaintiffs' arguments that Putnam breached its fiduciary duty to its own 401(k) plan participants by "stuffing" the plan with Putnam-affiliated investment funds, without regard to cost, performance or other metrics.... The Fidelity lawsuit, Ellis et al. vs. Fidelity Management Trust Co., concerned the firm's alleged mismanagement of a stable value fund. Plaintiffs claimed the fund's low investment returns and high fees made it an imprudent investment for 401(k) plan participants."  MORE >>