Fidelity Agrees to $12 Million Settlement In Suits by Profit-Sharing Plan Participants

Fidelity Investments agreed to pay $12 million to settle claims by participants in its own profit-sharing plan who alleged that the company unfairly favored proprietary mutual funds and paid excessive fees to in-house record keepers and advisers (Bilewicz v. FMR LLC, D. Mass., No. 1:14-cv-10035-DJC).

The settlement, which received preliminary approval July 10 by Judge Denise J. Casper of the U.S. District Court for the District of Massachusetts, also requires the company to offer non-Fidelity funds in its investment lineup and to increase employees’ default contribution amounts from 3 percent to 7 percent.

In granting preliminary approval, the ...