Fidelity Brokerage Services

Kurta Law is investigating Fidelity Brokerage Services’ broker recommendations. If you lost money with Fidelity, consider contacting an investment fraud lawyer today.

Fidelity Brokerage Services (CRD #: 7784) is a brokerage firm with headquarters in Smithfield, Rhode Island. Fidelity brokers may also be affiliated with Fidelity Personal and Workplace Advisors (FPWA) and Fidelity Institutional Wealth Adviser (FIWA).

What Services Does Fidelity Brokerage Services Offer?

Fidelity Brokerage Services offers brokerage accounts, including accounts for personal and retirement investing.

Investors who have a Fidelity brokerage account may choose from the following investments, some of which can feature considerable risks and substantial fees.

• Mutual funds
• Exchange-traded funds (ETFs)
• Stocks
• Bonds
• College Savings Plans

Fees and Conflicts of Interest

The Customer Relationship Summary (Form CRS) reveals some of the conflicts of interest that arise based on how Fidelity Brokerage Services brokers make money.

• Fidelity Brokerage Services and its affiliates earn more when you invest in a product related to the firm or one of its affiliates. These include Fidelity mutual funds, ETFs, and managed accounts.
• Mutual funds and ETFs impose fees that provide revenue for Fidelity Brokerage Services. This creates an incentive for brokers to recommend these products over others.
• Investments that buy or sell to you from the firm’s own accounts – i.e., “principal trades,” make more money for the firm than trades placed in the open market.
• Brokers who work for Fidelity Brokerage Services also work for Fidelity Personal and Workplace Advisors (FPWA) and Fidelity Institutional Wealth Adviser (FIWA). Brokers have an incentive to recommend products based on their affiliations with these firms.

Regulatory Actions

Investors should be aware of allegations brought by state and federal regulators against Fidelity Brokerage Services. Regulators are supposed to catch red flags of misconduct and can impose hefty penalties if they discover securities rule violations.

Fidelity Brokerage Services has 142 disclosures on its record. The following are just a few of the most recent – to see the complete list, visit the firm’s detailed BrokerCheck record.

$900,000 Fidelity Brokerage Services Fine for Options Trading Allegations

On October 2, 2023, Fidelity Brokerage Services entered into an Acceptance, Waiver, and Consent agreement (AWC) with FINRA in order to settle allegations regarding options trading. According to the AWC, the firm’s automated screening system did not catch inconsistencies in customer information. For instance, certain customers allegedly stated they had at least one year of investment experience even though they were younger than 19.

The findings also alleged that Fidelity Brokerage Services approved certain customers for options trading who did not satisfy the firm’s eligibility criteria or whose accounts contained red flags that merited a closer review prior to approving them for options trading.  

As part of the terms of the AWC, Fidelity Brokerage Services consented to a $900,000 fine. You can read a copy of the AWC here.

$750,000 Massachusetts Fine Regarding Options and Margin Trading

On January 26, 2022, the Massachusetts Securities Division alleged that Fidelity Brokerage Services engaged in unethical and dishonest conduct and practices in the securities business and failed to reasonably supervise agents regarding customer applications for options and margin trading.

Both options and margin trading come with considerable risk and do not suit most investors’ needs.

In addition to issuing a Cease and Dease Order, Massachusetts also fined Fidelity Brokerage Services $750,000.

$750,000 Massachusetts Fine Regarding Options Trading

On January 26, 2022, Fidelity Brokerage Services consented to the entry of the Massachusetts Securities Division’s findings that the firm did not reasonably execute its approval of options trading applications. Firms must screen options trading applications due to the risks involved. The firm allegedly failed to reasonably supervise its agents to ensure compliance with the Massachusetts Uniform Securities Act.

Massachusetts imposed a fine of $750,000.

Fidelity Brokers Disciplinary Actions

Fidelity Brokerage Services works with brokers who have records of misconduct. Kurta Law is aware of the following current or former Fidelity brokers with investor disputes on their records. This is by no means a complete list – reach out to Kurta Law if you have any concerns about your broker’s conduct.

• Kevin O’Callahan: https://www.kurtalawfirm.com/blog/kevin-ocallahan/
• Jon Urbach: https://www.kurtalawfirm.com/blog/jon-urbach/
• Michael Gibson: https://www.kurtalawfirm.com/blog/michael-gibson/
• Pamela Calhoun: https://www.kurtalawfirm.com/blog/pamela-calhoun/
• Tyler Cardon: https://www.kurtalawfirm.com/blog/tyler-cardon/
• Rick Diamond: https://www.kurtalawfirm.com/blog/rick-diamond/
• Kelly Johnston: https://www.kurtalawfirm.com/blog/kelly-johnston/
• Dan Michaelson: https://www.kurtalawfirm.com/blog/dan-michaelson/
• Steven Brakman: https://www.kurtalawfirm.com/blog/steven-brakman/
• Grant Wagstaff: https://www.kurtalawfirm.com/blog/grant-wagstaff/
• John Hervig: https://www.kurtalawfirm.com/blog/john-hervig/
• Nikko Richardson: https://www.kurtalawfirm.com/blog/nikko-richardson/
• Zachary Grant: https://www.kurtalawfirm.com/blog/zachary-grant/
• Raymond Samuels: https://www.kurtalawfirm.com/blog/raymond-samuels/
• John Bassmaji: https://www.kurtalawfirm.com/blog/john-bassmaji/
• Diana Orea: https://www.kurtalawfirm.com/blog/diana-orea/
• Darin Guthrie: https://www.kurtalawfirm.com/blog/darin-guthrie/
• Austin Zoellner: https://www.kurtalawfirm.com/blog/austin-zoellner/
• Brooke Spicer: https://www.kurtalawfirm.com/blog/brooke-spicer/
• Jeffrey Crum: https://www.kurtalawfirm.com/blog/jeffrey-crum/
• David Bedford: https://www.kurtalawfirm.com/blog/david-bedford/
• Sara Scaldini: https://www.kurtalawfirm.com/blog/sara-scaldini/
• Gerard Besette: https://www.kurtalawfirm.com/blog/gerard-bessette/
• Erik Snyder: https://www.kurtalawfirm.com/blog/erik-snyder/
• Richard Hargis: https://www.kurtalawfirm.com/blog/richard-hargis/
• Melanie Werthmuller: https://www.kurtalawfirm.com/blog/melanie-werthmuller/
• Nohra Bello: https://www.kurtalawfirm.com/blog/nohra-bello/
• Franciso Aguilera: https://www.kurtalawfirm.com/blog/francisco-aguilera/
• Jeffrey Towles: https://www.kurtalawfirm.com/blog/jeffrey-towles/

Kurta Law Can Help

If you have concerns about your Fidelity Brokerage Services investments, contact Kurta Law today. Our attorneys offer free case evaluations and do not collect a fee unless you win your case. Call (877) 600-0098 or email info@kurtalawfirm.com.