Top 8 News Stories of the Week

2. All in the Family

Fidelity Rolls Out No-Fee Investing Accounts for Teens

Fidelity Investments is expanding its market to the teenage children of adult clients, launching no-fee trading and saving accounts for teens, aged 13 to 17.

Parents will be able to monitor the activities of their teen’s Fidelity Youth Account. No minimum is required, and teens can buy or sell most publicly traded securities and fractional shares as well as Fidelity mutual funds, municipal bond funds, and money market mutual funds. Teen account holders can also make purchases and cash withdrawals with a free debit card or using a payment app like Venmo.

The accounts provide “the ability for teens to build healthy money habits through learning by doing,” said Jennifer Samalis, senior vice president of acquisition and loyalty at Fidelity Investments, in a statement.

(Image: Shutterstock)

3. A House Somewhat Divided

Democrats Mull Weakening Biden Tax on Capital Gains for Estates

The chairman of the House Ways & Means has reportedly floated an alternative proposal to President Biden’s plan to end the step-up in basis for inherited assets of $1 million or more. Rep. Richard Neal’s idea is to allow estate beneficiaries to defer the tax bill as long as they hang on to the assets. Neal said he’s waiting first to review the administration’s actual revenue proposals before working with committee members “to chart a path forward.”

(Image: Shutterstock)

4. A Female CEO at JPMorgan?

Dimon Succession Race Puts 2 Women Ahead of JPMorgan Pack

JPMorgan Chase & Co., the largest bank in the U.S., has elevated two women executives toward the top of its leadership ranks, potentially paving the way for one of them to succeed long-term CEO Jamie Dimon.

Marianne Lake and Jennifer Piepszak were named co-heads of the bank’s massive consumer and community banking business, a spot that was held by one of Dimon’s two lieutenants, co-President Gordon Smith, who’s retiring at the end of the year.

Lake, 51, is the bank’s former CFO and since 2019 has been in charge of consumer lending, which generates about a fourth of the company’s revenue. Piepszak, also 51, is the bank’s current CFO and member of the bank’s operating committee. Dimon, meanwhile, hasn’t said when he will step down.

(Photos: Bloomberg)

5. The Next Male Chief at Morgan Stanley

Morgan Stanley CEO Shakes Up Leadership with Eyes on Successor

Morgan Stanley has also shaken up its leadership ranks but, unlike JPMorgan Chase, has elevated several men, who could be likely successors to Chief Executive Officer James Gorman.

Ted Pick, the architect of Morgan Stanley’s trading revival, and Andy Saperstein, who built the company into a wealth management powerhouse, were elevated to co-presidents and given expanded roles. In addition, Dan Simkowitz was promoted to co-head of strategy alongside Pick, and Chief Financial Officer Jon Pruzan has become the chief operating officer.

“I am highly confident one of them will be the CEO in the future,” Gorman, 62, said of his leadership team in an interview. “It feels like the right time to more formally set up a transition over the next few years.”

(Photo: Bloomberg)

6. Layoffs, Again

UBS Starts Cutting Up to 700 Jobs in Across Wealth Unit, Investment Bank

UBS AG has started a broad round of job cuts across its largest divisions as part of a restructuring plan intended to save the bank $1 billion over the next three years.

Staff cuts are underway in the investment bank, wealth management unit and Swiss business, and range from managing director to junior employees, according to people with knowledge of the matter. As many as 700 positions are expected to be eliminated in Switzerland alone, including about 200 between in wealth management and the bank’s Swiss unit for personal and corporate banking. They will follow 125 cuts still to come from a previous wealth restructuring.

(Photographer: Stefan Wermuth/Bloomberg)

7. If You Don’t Succeed Try, Try Again

FSI Lobbies Senators for a Fix After DOL Kills Independent Contractor Rule

The Financial Services Institute (FSI), which had joined a lawsuit opposing the Biden administration’s delay of the independent contractor rule adopted by the Trump administration, is now lobbying senators to oppose the withdrawal of the rule by the current Department of Labor.

David Bellaire, FSI’s general counsel, told ThinkAdvisor’s Human Capital podcast that the organization has already met with Sen. Patty Murray, D-Wash., chairwoman of the Senate Health Education Labor & Pensions Committee, to discuss a legislative remedy to the withdrawn rule.

FSI’s membership includes more than 80 independent financial services firms, which have over 130,000 affiliated financial advisors who are independent contractors that are affected by the rule’s withdrawal.

8. Another Wells Fargo Lawsuit

Wells Fargo Faces Lawsuit for Allegedly Mismanaging Its 401(k) Plan

A federal court judge in Minnesota has ruled that a class-action suit against Wells Fargo claiming the bank mismanaged a $40 billion-plus 401(k) plan for its own employees, can proceed. U.S. District Judge Donovan Frank denied Wells Fargo & Co’s motion to dismiss the complaint.

The suit, brought on behalf of plan participant Yvonne Becker in U.S. District Court for the District of Minnesota, argues that high-level executives at Wells Fargo — who were named as the retirement plan’s fiduciaries — selected 17 Wells Fargo proprietary funds, many of which underperformed the fund benchmarks and that the bank had picked “as an appropriate broad-based market index for each Wells Fargo Fund”. ”

The 401(k) plan has over $40 billion in assets from more than 340,000 plan participants.

(Photo: Bloomberg)