Following regulations in 2011, Fidelity prevented US persons to invest in funds that are not registered for distribution or sale in the USA. In 2025, we’ve spoken to many clients who see that there has been a renewed wholesale review of clients, and those identified as US Persons are getting a letter freezing their Fidelity ISA account. Because the vast majority of investment funds on the Fidelity ISA platform fall into this restricted category, Fidelity’s effective policy is not to offer its services to US persons at all. Their Client Terms and Conditions explicitly state that their products are not for US citizens.

The 2011 regulations refer to the implementation of the U.S. Foreign Account Tax Compliance Act (FATCA). It requires foreign financial institutions (like Fidelity International in the UK) to identify any clients who are US citizens and report information about their accounts directly to the US Internal Revenue Service (IRS).

Account Freezing: When Fidelity identifies an existing account holder as a US citizen, their policy is to block the account. This action prevents the client from making any further trades, such as buying or swapping investments. In addition to freezing the client’s accoun,t they usually block trasnfers out until they recieve a US Tax Identification Number.

Resolution: The affected client is then typically required to transfer their investments out to another provider who can service US persons. Fidelity offers to facilitate a free transfer.

Worryingly, the terms and conditions state “Fidelity may sell your investments and close your account if you are or become a US person“. This is what is called a “forced close-out”. A “forced close out” (also known as a forced liquidation) is when the investment provider compels you to close your account, typically by selling all of your holdings. This is not a voluntary action on your part.

Frozen Fidelity ISA: Transfer to new provider

A frozen or blocked Fidelity ISA can be very frustrating if you are trying to transfer your investments to another provider, as what should be a relatively straightforward process is hampered by the lack of platforms that accept Americans, and more so, some of your holdings may not be directly transferable. If your ISA is frozen, activity on your account is locked by Fidelity – you generally cannot trade or add funds. A transfer will not be allowed until you give an ITIN. We have done ISA transfers for U.S. citizens, but it is essential to follow the process correctly and provide the necessary paperwork to allow the receiving provider to accept the assets. This means knowing what Fidelity needs to release an ISA and what the receiving provider needs.

Here are the reasons your Fidelity ISA is frozen, and how to practically go about making a transfer when the account cannot be freely accessed.

Why would Fidelity Freeze my ISA?

The main reason Fidelity would freeze or block an ISA is for regulatory, compliance or operational reasons. This should not be due to any action or error by the investor, and in many cases, is a blanket policy applied system-wide for certain types of accounts. Below are the main reasons for Americans:

1. Identification documents: Fidelity must, under FCA rules and anti-money-laundering legislation, maintain accurate and up-to-date KYC documents for all investors.  Outdated identification or address details mean they may no longer verify your personal information.
2. Overseas residence/citizenship issues: If Fidelity is made aware that an investor has moved abroad or is a US citizen, extra compliance checks are triggered because of current regulatory rules. Many providers do not accept US citizens these days and complete internal reviews to confirm whether they can continue to service that account under their current policies and international regulations.
3. Internal compliance audit: Random audits or a flag from an automated system can reveal new information. This is a normal financial services industry process. Tax authorities increasingly exchange data between countries under global agreements, allowing them to identify individuals’ citizenship, residency, and financial accounts. This automatic information sharing means mismatches or undeclared statuses—such as US citizenship—are quickly flagged to both tax offices and financial institutions.

How Do I Transfer a Frozen Fidelity ISA?

The process is a little more regimented than a typical ISA transfer process. Below is a breakdown:

1. Provide any outstanding information required by Fidelity. These pieces of information will need to be completed prior to the ISA moving.
   • Your US Social Security number using the declaration below.
2. Speak to Edale so they can complete necessary checks and confirm they can provide advice and open with a new provider that accepts Americans.
   • Open new account with financial advice
   • Completed ISA Transfer Authority Form
   • Complete a Letter of Authority for Edale to act as adviser to your Fidelity ISA.
3. Begin the transfer process with your new provider
4. Edale inform Fidelity that they are to lift any block for a transfer-out and not to force a sale
   • For a transfer-out, Fidelity will typically lift a “block” for the purpose of the transfer. Frozen does not mean it is held captive forever – it simply cannot be actively managed.
5. The receiving provider initiates a request for the assets
   • The receiving provider will work directly with Fidelity to request the assets, either through electronic systems or paper forms; there is no need for you to be involved in this stage.
6. Transfer completed either in cash or as assets (where permitted)
   • Depending on the type of freeze, the transfer may be completed:
     • In-specie — If the investments can be transferred directly (ie are available on the receiving platform). This is overwhelmingly the most preferred option under the cases we have dealt with as it means that no chargeable taxable event occurs. If not inspecie then we do cash moves may be required where the asset is sold and then transferred as cash.
   • The new provider will confirm to you how the transfer will be completed.
7. Finalise and confirm the ISA is now active with your new provider
   • Once the assets have been received, the ISA is now live with the new provider and you can make contributions and investment decisions as normal.

Facilitating Transfers of Fidelity ISA Holdings (Including ‘W’ Share Classes)

Fidelity UK is one of the longest-standing and largest platforms in the UK. As such, many US citizens have accounts there and opened their ISA accounts many years ago (i.e. pre-FATCA). Given the large number of ISA transfers we have successfully facilitated in recent months, we have expanded the platforms and types of funds we can help move after considerable research and case work.

The key point to note is that many of the older funds held by Fidelity may not be available elsewhere. For exampl,e we have seen lots of Fidelity ‘W shareclasses’. As these share classes are less commonly supported on newer fund platforms, this often creates a barrier to US citizens who wish to move their holdings. In many cases, we are in a position to enable a move of these older share classes.

If you are a US citizen and would like us to check if we can move your ISA holdings (without having to sell them to cash, which creates an unattractive US tax liability) please provide us with the ISINs or SEDOLs of your holdings and we will confirm whether we can do an in-specie transfer for those specific investments.

Open a new ISA or General Investment Account with Edale

Before organising a transfer, it’s best to open an ISA, you can open an account and transfer all digitally with us.

Complete our application form at https://edale.co/open-ISA/. Some application assistance is here https://edale.co/isa-open-walkthrough/ 

Declaring your US Tax Identification Number to Fidelity

Complete the form below and upload it to your Fidelity account, and it will then remove any blocks for a transfer if your ISA or GIA.

How to Complete the ISA Account Transfer Form

To transfer an ISA in specie (holding your existing investments) to or from Edale’s ISA provider, you must initiate the transfer through our Client Portal.

Log in to your Client Portal and go to Transfer & Pay > Transfer Existing ISA from the main menu. See below.

1. Existing Provider Account Id

• What to enter: Input your account number from Fidelity International. You can find this on your Fidelity statements or by logging into your Fidelity account online.
• Why it’s needed: This is a required field that allows your new provider to identify the specific account you wish to transfer.

2. Existing Provider Name

• What to enter: This should be pre-filled with “FIDELITY INTERNATIONAL.” If not, select it from the dropdown list.

3. Total amount being transferred (approx.) in GBP

• What to enter: Provide an estimated total value of the assets (investments and cash) in your Fidelity ISA. You don’t need the exact figure down to the penny, but a close approximation is necessary.
• Why it’s needed: This gives the new provider an idea of the transfer’s size for administrative purposes.

4. Type of Transfer

• Information: The form indicates this is a “Full Account Transfer,” meaning you intend to move the entire contents of your Fidelity ISA.

5. Please choose one of the options

This is the most important section as it determines how your assets are moved.

In-Specie / Position Transfer should be selected

• What it means: By choosing this option, you are instructing your new provider to move your investments (like stocks, bonds, and funds) “as is” from Fidelity, without selling them. You will keep your exact same holdings.
• When to choose this: This is generally the best option if you are happy with your current investments and want to remain invested in the market throughout the transfer process. It avoids the risk of selling low and buying back high.
• Important Note: The form mentions that any investments held at Fidelity that are “ineligible for the IB platform” (i.e., not available to be held with your new provider) will be automatically sold, and the resulting cash will be transferred over. This might cause slight delays in the overall transfer.

We shall then contact your current provider to arrange the transfer of the specified investments. While we do support in-specie transfers, availability depends on your existing provider and whether our platform offers those specific investments.