Partially upheld: Account suspension, investment liquidation, and customer service failure complaint against Financial Administration Services Limited (trading as Fidelity)
Financial Ombudsman decision DRN-6076513 of 2026-04-09T00:00:00+00:00. Account suspension, investment liquidation, and customer service failure complaint against Financial Administration Services Limited (trading as Fidelity). Outcome: Partially upheld.
Decision detail
| Reference | DRN-6076513 |
|---|---|
| Decision date | 2026-04-09T00:00:00+00:00 |
| Firm | Financial Administration Services Limited (trading as Fidelity) |
| Product | Investment |
| Claim type | Account suspension, investment liquidation, and customer service failure |
| Outcome | Partially upheld |
| Remedy | Fidelity is directed to pay Miss W £150 compensation to acknowledge the additional frustration and stress caused by its failure to communicate with her in a timely manner regarding her appeal of the account suspension. |
Summary
Miss W opened a stocks and shares ISA with Fidelity in May 2020, disclosing her US birthplace but self-declaring as not a US person. In January 2025, following a new checking process, Fidelity identified Miss W as potentially being a US person and suspended her account, requesting evidence of non-US status or US tax information. When Miss W could not provide a Certificate of Lost Nationality, Fidelity determined it must treat her as a US person and intended to liquidate her investments and deduct US withholding tax. The ombudsman found Fidelity's actions reasonable given its terms prohibiting business with US persons and its regulatory obligations, but upheld the complaint in part because Fidelity failed to respond to Miss W's appeal of the suspension from February to July 2025, unnecessarily prolonging her distress. Fidelity was directed to pay £150 compensation for this service failure.
The Ombudsman's reasoning
The ombudsman found that Fidelity acted reasonably in identifying Miss W as a potential US person based on her birthplace and requiring evidence of non-US person status or US tax information, particularly following notification from the US that some customers may be US persons. The ombudsman concluded that Fidelity's terms clearly stated it could not accept business from US persons, including dual citizens, and that Miss W bore responsibility as an execution-only customer to understand her own citizenship status. The ombudsman found that without a CLN, it was reasonable for Fidelity to treat Miss W as a US person and to freeze her account pending clarification. However, the ombudsman identified a service failing in Fidelity's failure to respond to Miss W's appeal of the suspension decision in a timely manner, which unnecessarily prolonged her distress and frustration.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Financial Administration Services Limited (trading as Fidelity), all decisions | 1 | 50% |
| Investment, all decisions | 13,970 | 35% |
Source
Read the original decision on the Financial Ombudsman Service website