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The letter Kelly Havins received in September seemed suspicious.
Mr. Havins, 63, lives in Phoenix and works as a food retail consultant. The letter appeared to be from Fidelity Investments, where he had a 401(k) account for decades.
The letter says some Fidelity customers may have provided online login credentials to “third-party platforms used by advisors to access their accounts.” It instructs Havins to contact Fidelity to verify his credentials or be locked out of his account.
“There have been a lot of scams lately, so I immediately made a copy and sent it to Kyle,” Havins said.
Kyle Luber, CEO of wealth management firm Guided Capital, has been a financial advisor to Habins for several years. Houston-based Lubar, with Habins’ blessing, is using the type of platform described in Fidelity’s letter.
“I don’t know how to use stocks or how to trade them,” Habins told USA TODAY. “That’s their job.”
The tool that allows remote access for advisors like Louvar is called Pontera. When Fidelity implemented its month-long decision to crack down on its use, many clients lost digital access to their accounts and were forced to contact Fidelity to re-establish their credentials.
Fidelity says it protects client account information and funds and that advisors who want access to client accounts have a safer alternative to Pontera. Meanwhile, Pontera said its technology is sound and the investment giant is cutting out third parties to sell its advisory services to captive clients.
Industry insiders say the heart of the controversy exposes a harsh truth about America’s retirement savings conundrum. With pensions declining, the responsibility to financially prepare for the end of life falls squarely on the shoulders of ordinary people with jobs, children, aging parents, and many other everyday concerns.
Additionally, the financial literacy and investment skills of most Americans are questionable, leaving them at the mercy of providers of all types of financial services and products.
This do-it-yourself move is “probably one of the biggest mistakes we’ve made as a society in the last 40 years,” said William Birdthistle, a professor at the University of Chicago Law School who previously served as director of the Securities and Exchange Commission’s division of investment management. “It reminds me of the cigarette ads I saw when I was a kid, because they almost always pitched themselves like the Marlboro Man, with a financial theme: You decide your own financial destiny.”
Financial advisor wants access to 401(k) account
A financial advisor who spoke with USA TODAY about Pontera said Pontera solves a real problem.
Customers may have large sums of money in 401(k), 403(b), and other accounts, but have little or no idea what’s inside. Your quota may have been chosen years ago when you first started your account, and may have changed little or not at all. These may overlap with some of the investment strategies that the Advisor has implemented in more actively managed accounts. Or it may conflict with those goals.
Gregory Gunter, managing partner at New Jersey-based Grantvest Financial Group, said Pontera “is creating a bridge between us as advisors and the retirement portfolios of our corporate, municipal or federally sponsored clients.”
“This just replaces the outdated framework of, ‘Send us your statement, we’ll add it to our file, we’ll include it in our review.’ It’s 2025. This is the solution for 2025.”
Are there other ways to view my retirement accounts?
But Pontera isn’t the only alternative to old-fashioned or manual attempts to share account information.
In response to USA TODAY’s request for comment, a Fidelity spokesperson said in an email: “Requiring customers to share their login credentials with a third party, which then stores them, is widely considered unsafe and is not supported by Fidelity, especially since the third party can perform actions such as executing trades on any customer’s Fidelity account.” Following a 401(k) allows you to do so because you have access to solutions and advisors that utilize safe practices. ”
One such solution is Absolute Capital, a Pittsburgh-based company. The company has formal agreements with Fidelity and other retirement plan providers. Brenden Geben, the company’s CEO, said these agreements make it clear to companies like Fidelity that they are the absolute authority logging in on behalf of their clients, rather than advisors masquerading as clients. He says this is what’s happening in Pontera.
“We are a regulated organization,” Geben said. In contrast, Pontera is not regulated from a financial perspective, he said. “They’re a financial tech company.”
Pontera’s perspective
Pontera, founded in 2012 and based in Manhattan, says it doesn’t need regulation in the traditional sense as a technology provider. The company says the security concerns expressed by Fidelity are disingenuous and that the access restrictions are actually a means for Fidelity to sell its services to customers.
In response to a request for comment, a Fidelity spokesperson referred to registered investment advisers who do not work for Fidelity and said they “work closely with plan sponsors to assist many RIAs in safely advising on employer-sponsored retirement accounts under the supervision of plan sponsors.”
Retirement accounts are “one of the only situations in which a consumer who is a plan participant is bound and subject to any requirements unilaterally imposed by the plan provider,” Pontera spokesman Zachary Pardes said in an email. “If Fidelity decides to permanently lock you out of your 401(k) account for any reason, your only option is to quit your job and switch providers.”
Pontera cites a variety of regulations, ranging from Department of Labor guidance to SEC rules, that show it operates within generally accepted industry standards. It also has deals with Fidelity’s competitors, including Manulife John Hancock and 401Go.
The company said it has been repeatedly offered to work more closely with Fidelity to establish a best-in-class “API” electronic interface, but Fidelity has not responded to those requests.
Meanwhile, Fidelity told USA TODAY that many retirement account holders “said they were unaware that their credentials were being shared.”
Without an API or interface like the one Fidelity approved with Absolute Capital, “Fidelity has legitimate concerns about how Pontera is currently accessing its information,” said Corey Freyer, director of investor protection at the Consumer Federation of America, a nonpartisan advocacy group. “Furthermore, from my perspective, the Pontera model certainly looks like an attempt to circumvent some of the (regulatory) rules that would be triggered if an advisor were to do this same thing directly.”
Customers want choice
Pontera bills itself as an ally of consumers who want choice. “Retirement savers, you deserve better. You have a choice, not a prisoner,” CEO Yoav Zuler wrote in an Oct. 10 blog post.
However, the people who pay to use Pontera are financial advisors, not savers themselves. This means that only those customers who can afford to hire an advisor will benefit from their services.
This speaks to the disparities that have arisen in employer-directed, self-directed retirement plans that have evolved over the years. Academic research shows that black and Hispanic workers with access to 401(k) or 403(b) plans contribute about 40 percent less than white workers, giving black workers $0.31 in tax benefits for every dollar earned by white workers.
A 2024 paper found that the tax benefits available to employees are being borne by taxpayers overall, at a cost equivalent to more than 1.5% of annual GDP.
Whatever the shortcomings of the current system, consumers like Kelly Havins say it’s important to be in control of your money. He believes that both working with an independent financial advisor and using Pontera serve the purpose.
“I understood what they were doing,” he said of Fidelity. “It was a power play to take out Kyle and his team…and they sold me a program to manage my money and kept it at home.”
A Fidelity spokeswoman did not respond to a request for comment on Havens’ opinion.
“We didn’t want to be pushed by a big company,” Havins said.
