Computer Glitch, Human Error Blamed In Fidelity Price Listings
BOSTON (AP) _ A computer glitch and human error caused Fidelity Investments to list outdated prices for its mutual funds last week, a company spokesman said Wednesday.
The company provided day-old price listings for 150 of its 208 mutual funds Friday to the National Association of Securities Dealers. NASD passed these figures on to vendors, including The Associated Press, which provides stock listings to several hundred newspapers nationwide.
As a result, mutual fund price listings that appeared in weekend papers were wrong.
Fidelity, the nation’s largest mutual fund manager, usually calculates mutual fund prices by 5:30 p.m. EDT on weekdays and passes the information along to NASD.
But a software problem prevented Fidelity from calculating Friday’s figures, said Connie Hubbell, a Fidelity spokeswoman.
When these problems occur, the company’s policy is to report the prices as ″na″, or ″not available.″ But a fund accounting employee instead submitted the previous day’s prices, she said. Those prices were published in Saturday newspapers.
Hubbell declined to identify the employee or say if the employee would be disciplined.
″This was very much an isolated incident and we’ve taken steps to make sure this doesn’t happen again,″ she said.
Customers who called Fidelity Friday evening were told that fund price information was unavailable. By 9:30 p.m., up-to-date figures were available.
NASD, which polices securities brokers, did not discover the error until Monday, when clients called to complain, said NASD spokesman James Spellman. A correction appeared with tables sent out Tuesday.
Hubbell said she does not know if any efforts were made to correct the error before Monday. Many newspapers repeat Friday’s price listings on Sundays and Mondays.
She said the error did not affect transactions made over the weekend. Sales and purchase orders are based on the next business day’s price, not the previous day’s.
But she said Fidelity will review the claims of any customers who believe they lost money because of the mistake.
Barry Barbash, the Securities and Exchange Commission official who oversees mutual funds, could not be reached Wednesday. But he previously said it was unlikely any enforcement action would be taken against Fidelity.