Woman Sues Fido Over Failure to Honor Guarantee
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Friday, December 28, 2007

Woman Sues Fido Over Failure to Honor Guarantee

A Washington woman has recently filed suit against Fidelity over her husband's fraudulent withdrawals of $347,546 from her IRA account, a joint investment account with her brother and three custodial accounts for her daughters.

A Fidelity spokesperson told MFWire: "While we are not going to comment on the details of this ongoing legal matter. We can tell you that we believe the suit is without merit. We intend to defend against the suit vigorously. As with many guarantees, there are some reasonable conditions on coverage. These conditions are described on our website."

In a lawsuit filed in the Western District of Washington on October 1, Patricia Whitney said that under Fidelity's "Customer Protection Guarantee" losses due to "unauthorized activity" would be reimbursed. According to Whitney, Fidelity did not respond to repeated requests from both herself and her attorneys, that the company do so, making the suit necessary.

In her complaint, Whitney alleged that Fidelity became aware of the fraud when the password on her account was changed, followed by a spate of irregular withdrawals. Additionally, Whitney alleged that Fidelity failed to recognize that signatures on checks, supposedly from Whitney, were actually forged by her husband.

Whitney is seeking compensation in the amount of the money lost plus interest income, attorney fees and damages to be determined by the jury at trial.

The "Customer Protection Guarantee" stated on the Fidelity's website does suggest that customers do a few small things to minimize the chances that their account will be breached. Among them are to frequently monitor their accounts, take precautions to safeguard their PIN and securing their computer.

No additional hearings in the case have been set as of press time.

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