(Bloomberg) – Fidelity Investments has fired about 200 employees who were accused of abusing company benefits, according to a person familiar with the matter.
Fidelity had a program which reimbursed workers for 20% of the purchase of computer equipment up to $10,000. An audit found that some employees returned the equipment without reporting it, keeping the reimbursement allowance, said the person, who declined to be named.
The funds with the biggest AUM declines didn’t badly underperform, but investors often found cheaper alternatives.
“We have a culture of compliance and integrity at Fidelity,” spokesman Vincent Loporchio wrote in an emailed statement. No customers were affected by the actions, he said.
Many of the employees who were dismissed worked in the firm’s brokerage unit. The company became aware of the problem last year, the person said.
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The move comes after Vanguard, State Street and BlackRock lowered expense ratios.
February 28 -
The move comes as a surprise; "active search" for a replacement underway.
January 13 -
"There is an effort underway in our industry to redefine value," Tim Hockey, TD Ameritrade's chief executive officer, said about the lower commissions.
March 1
The Wall Street Journal
“Our employees have high standards and act in our customers’ best interests,” the spokesman said. “However, in the very small percentage of instances where we identify misconduct, we take appropriate action.”
Fidelity, based in Boston, has more than 40,000 employees and manages $2.4 trillion in assets.
