{"id":380997,"date":"2025-11-15T15:37:15","date_gmt":"2025-11-15T15:37:15","guid":{"rendered":"https:\/\/www.europesays.com\/us\/380997\/"},"modified":"2025-11-15T15:37:15","modified_gmt":"2025-11-15T15:37:15","slug":"fidelity-customers-lose-401k-access-some-call-it-a-mind-boggling-power-grab-but-the-company-says-its-about-safety","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/380997\/","title":{"rendered":"Fidelity customers lose 401(k) access. Some call it a ‘mind-boggling’ power grab. But the company says it’s about safety"},"content":{"rendered":"\n

As a major investment company and financial technology (fintech) platforms fight over access to client retirement accounts, some customers caught in the middle are discovering that the \u201cK\u201d in 401(k)<\/a> might just stand for \u201cKeep out.\u201d<\/p>\n

The retirement<\/a> rumble escalated recently when Fidelity began enforcing a new policy restricting access for third-party financial advisors, and clients learned they lost online access to their 401(k) accounts for enlisting outside help.<\/p>\n<\/p>\n

Among those locked out were users of Pontera, a popular investment management platform. Pontera allows financial advisors to access a client\u2019s 401(k) account, like those held with Fidelity, through their platform while protecting the client\u2019s personal login credentials. That way advisors can safely manage the account while being restrained by the platform from gaining control over actions such as transferring a client\u2019s funds without authorization.<\/p>\n

Back in September 2024, Fidelity released a statement expressing concerns about the dangers of \u201ccredential sharing \u2026 particularly when it enables third parties to take high-risk actions, such as executing trades within the accounts (1).\u201d As a result, they warned that they would \u201cprevent platforms reliant on credential sharing from accessing and taking action in customer accounts.\u201d Now, customers who employed third-party platforms like Pontera are being locked out of their own Fidelity retirement accounts.<\/p>\n

One example is Phoenix resident Kelly Havins, 63, who told The New York Times that he enlisted a Pontera financial advisor because, when it comes to managing his 401(k), he doesn\u2019t \u201chave the time or the understanding (2).\u201d He said that when Fidelity contacted him to warn he could be locked out of his account, he \u201cthought it was a scam.\u201d But it wasn\u2019t and, after some back and forth with Fidelity, he lost online access to his account. Havins said he had to work with his financial advisor to regain access.<\/p>\n

For its part, a Fidelity spokesperson told InvestmentNews that they only block online access and that a direct call with a company rep will help customers restore it (3).<\/p>\n

Still, financial advisor John Rathnam told news outlet Arizona\u2019s Family that the idea that people \u201cmight get cut off from their largest savings account \u2014 that\u2019s kind of crazy. That\u2019s mind-boggling to me. I\u2019ve got to believe that they could have handled it better than that (4).\u201d<\/p>\n

Story Continues <\/p>\n

In an open letter posted to their website on Oct. 10, Pontera framed the situation as a \u201cbattle\u201d between one side that stands for \u201cconsumer choice\u201d and another that is \u201can entrenched institutional incumbent highly conflicted and motivated by their own economics (5).\u201d They labelled Fidelity\u2019s actions an \u201can anticompetitive power grab,\u201d accusing them of compelling clients to use their own in-house financial advisors. As well, they classified those same clients as \u201ccaptives \u2026 lacking the ability to move their money elsewhere\u201d as a 401(k) is tied to an employer, and it\u2019s the latter who decides what investment company they use.<\/p>\n

A Fidelity spokesperson told USA Today they do in fact \u201cwork closely to support\u201d independent Registered Investment Advisors (RIAs) who \u201csecurely advise on employer-sponsored retirement accounts with plan sponsor oversight (6).”<\/p>\n

Brenden Gebben, CEO of Absolute Capital, also spoke with USA Today and said that his company has an agreement with Fidelity to advise on behalf of their clients, adding that \u201cWe are a regulated entity” and noted Pontera is unregulated from a financial perspective.<\/p>\n

Meanwhile, financial planner Ben Henry-Moreland said in an interview with InvestmentNews that Pontera and similar third-party platforms \u201cuse ‘screen scraping’ technology that gives them access to a lot more client information than what’s needed for the tool to perform its function (7).\u201d He warned that such data could potentially be sold without the client\u2019s permission, but did say that \u201cit’s frustrating that Fidelity, if reporting is true, hasn’t worked with Pontera\u201d to create a more secure connection between them.<\/p>\n

To that end, Pontera told The New York Times that they tried to work with Fidelity to customize secure access to customer investment accounts, but didn\u2019t hear back.<\/p>\n

The ongoing struggle between Fidelity and Pontera does raise the point that many Americans would prefer to choose their own financial advisor when it comes to handling their 401(k) accounts.<\/p>\n

The advantages of a financial advisor are clear: personalized advice based solely on your own needs and desires, as well as a trusted professional to answer questions, explain your investment options and warn of impending risk you might not see coming.<\/p>\n

That said, as Kiplinger notes, financial advisors have to get paid, too, and they \u201ctypically charge an annual fee based on a percentage of the assets they manage,\u201d often somewhere between 0.5% and 1.5% (8). Still, the outlet adds that \u201cthe personalized advice and improved performance they can provide may outweigh the cost of their fees over time.\u201d<\/p>\n

It\u2019s also a good idea to weigh your need for an advisor. Ask yourself, are your account management needs complicated enough to necessitate outside help? If so, make sure to enlist a fiduciary investment advisor to look out for your financial needs. Fiduciaries, by law, must act solely in your own best interest when managing your accounts.<\/p>\n

Forbes notes that an advisor can take multiple separate accounts and employ \u201ca portfolio-based approach [that] focuses on achieving the target asset mix when all accounts are combined (9).\u201d The publication adds your 401(k) may also need to be rebalanced regularly to ensure it\u2019s working toward your retirement goals.<\/p>\n

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n

Fidelity Investments (1<\/a>); The New York Times (2<\/a>); InvestmentNews (3<\/a>, 7<\/a>); Arizona\u2019s Family (4<\/a>); Pontera (5<\/a>); USA Today (6<\/a>); Kiplinger (8<\/a>); Forbes (9<\/a>)<\/p>\n

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"As a major investment company and financial technology (fintech) platforms fight over access to client retirement accounts, some…\n","protected":false},"author":3,"featured_media":380998,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[64,51521,12157,55406,45303,182537,255,67,132,68],"class_list":{"0":"post-380997","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-fidelity","10":"tag-financial-advisors","11":"tag-financial-technology","12":"tag-investment-company","13":"tag-online-access","14":"tag-personal-finance","15":"tag-united-states","16":"tag-unitedstates","17":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115554460806820762","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/380997","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=380997"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/380997\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/380998"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=380997"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=380997"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=380997"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}