Fidelity customers who use a certain kind of account have discovered cumbersome deposit restrictions in recent days. In some cases, folks say they’re encountering weeks-long holds for deposits to clear.
Here’s what’s happening: The financial services company has recently seen a surge in fraudulent activity, which meant it needed to take “immediate steps to handle the difficulty,” a spokesperson said in an email. While Fidelity isn’t confirming what exactly those actions entail, affected Reddit users are reporting frustrating personal experiences with the brand new fraud prevention measures, which they are saying are overly aggressive.
The fraud scheme in query went semi-viral earlier this month, sometimes under the hashtag “#fidelityboyz.” In a single post that has over 4,500 likes on Instagram, several men wearing Fidelity T-shirts are seen throwing large amounts of money within the air.
It shares similarities to the “infinite money glitch” that involved Chase Bank just a couple of weeks ago.
The “fidelityboyz” trend essentially promised customers a hack to get free money. It involved immediately withdrawing funds via phony checks before Fidelity actually cleared the deposits. In point of fact, it was just check fraud, and other people who tried it should likely face serious consequences.
Within the meantime, the kind of account that’s been affected is named a money management account, abbreviated CMA. These are interest-bearing accounts which have functionalities for paying bills in addition to cashing and writing checks. On its website, Fidelity calls them an “alternative to traditional banking.”
But customers are actually reporting in forums that after they’ve tried to make legitimate transfers and check deposits, they have been slapped with holds and have not been capable of access money they need.
On Friday, the Wall Street Journal reported that Fidelity deposit limits had been reduced from $100,000 to $1,000 in some cases, adding that the fraud concerns were specifically related to mobile-app check deposits. Reddit users claim they’ve also found holds on electronic fund transfers after they’ve tried to tug money into their Fidelity account from other banks.
“I actually dig my CMA account, but weeks for a transfer ain’t gonna cut it,” one user wrote. One other reported, “Fidelity is holding 2 deposits until October eleventh. I even have bills to pay.”
Fidelity’s stance is that it is concentrated on stopping fraud.
“We recently identified individuals attempting to commit fraud using their Fidelity accounts. We’ve got no tolerance for any kind of criminal activity,” a spokesperson said. “To be clear, these individuals were committing fraud with respect to their very own accounts: No other customer information, accounts or assets were in danger.”
Along with social media, the Fidelity scam was also trending amongst fraudsters on Telegram, a messaging app, in keeping with the fraud blog FrankonFraud. Unlike the Chase “glitch,” nonetheless, this scheme didn’t involve raiding ATMs for money.
“Since Fidelity doesn’t have ATMs, the strategy seems to concentrate on depositing fake or altered checks through mobile apps — often on newly opened accounts,” the FrankonFraud blog post read. “After checks are posted, people either use debit cards or wire transfers to extract the cash quickly.”
Fidelity’s latest safeguards appear to have largely shut down the criminal activity. The challenge now’s that some customers who’ve ostensibly done nothing mistaken are being told they’ll must wait to give you the chance to withdraw or invest funds which are subject to a hold. The corporate has not specified the way it plans to resolve that issue.
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