Fidelity® 401(k) Lawsuit: Does Fidelity Take Care of Its Own?
For more than 60 years, Fidelity Investments® has helped guide people in making smart retirement investment decisions. Yet, the firm’s ability to responsibly manage a 401(k) plan for its own employees is in question. On March 20, 2013, a prospective class action lawsuit was filed by a former employee, claiming that the investment giant structured its FMR Profit Sharing Plan to benefit the company’s bottom line vs. employees’ long-term financial security.
Fidelity 401(k) Lawsuit: You May Qualify for Compensation
If you are a Fidelity employee (or have been in the past five years) and participated in the FMR Profit Sharing Plan, you may be eligible to receive compensation for economic losses related to the alleged mismanagement of your 401(k) retirement plan.
At the heart of the complaint:
- Employee Retirement Income Act of 1974 (ERISA) requires administrators to act solely in the interest of their plan’s participants when making decisions with respect to selecting, removing, replacing, and monitoring the plan’s investments.
- The FMR Profit Sharing Plan comprises a single fund family—Fidelity—a practice followed by only 10% of 401(k) plans.
- This structure keeps fee revenue “in-house” for FMR, but doesn’t necessarily benefit plan participants who could get better results (and lower fees) if offered a wider range of fund options.
Fidelity Investments is a registered trademark owned by FMR LLC