Fidelity Fires Nine Employees For Violating Company Policy

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Fidelity Fires Nine Employees
                         For Violating Company Policy

                         By JAMES S. HIRSCH Staff Reporter of THE WALL
                         STREET JOURNAL

                         Fidelity Investments has fired nine employees
                         and disciplined 16 others for violating various
                         company policies, including participating
                         in on-site betting pools for football and
                         basketball games.

                         Fidelity, the nation's largest mutual-fund firm,
                         said the employees also misused company e-mail
                         and spent "excessive" amounts of time using
                         the Internet for nonwork activities.

                         The discoveries by Fidelity sent alarms
                         through the Boston company, which has about
                         $600 billion in assets under management and
                         has relied on a reputation for integrity to
                         attract and retain customers. On Tuesday, David
                         Weinstein, Fidelity's senior vice president
                         of administration, sent electronic memos to
                         all employees that said the company wouldn't
                         condone the use of company e-mail for sports
                         pools, and reiterated many company policies,
                         including prohibition of employees from gambling
                         on company time.

                         "I trust a word to the wise is sufficient,"
                         Mr. Weinstein wrote.

                         Fidelity spokeswoman Anne Crowley said the
                         company took action three weeks ago, and the
                         employees who were either fired or disciplined
                         didn't include any mutual-fund managers. She
                         declined to identify the employee positions
                         or their business units, but said the affected
                         employees worked in more than one city.

                         She said that no customer accounts or funds
                         were involved. Fidelity has 24,300 employees.

                         Like many companies, Fidelity regularly
                         monitors employees' use of e-mail
                         and Internet and Intranet services, and
                         Fidelity notifies employees that they will be
                         monitored. Ms. Crowley declined to describe
                         how Fidelity learned about the sports betting
                         pools or to specify how much money was involved.
                         Employees also bet on baseball and golf games,
                         she said, and the betting pools occurred over
                         a number of months. "Small bets were typically
                         found," Ms.  Crowley said.

                         She also declined to comment on what nonwork
                         activities the employees were engaged in.

                         But several insiders said the infractions had
                         to have been very serious to merit dismissals
                         instead of warnings. Ms. Crowley said the 16
                         employees who were disciplined didn't have to
                         pay any fines, but said "corrective actions"
                         could involve verbal or written warnings,
                         suspensions or probations.

                         --Karen Hube contributed to this article.