The trading desk at Fidelity Investments witnessed yet another departure this week when David K. Donovan Jr., who headed the group that trades technology stocks, left the company on Tuesday, according to the Boston Globe.
Donovan is the fifth trader to depart Fidelity since federal regulators began investigating last year whether traders at the Boston-based fund giant steered business towards those clients who offered them gifts and entertainment.
"I want to move on and do something different," Donovan told the Boston Globe. He said he wasn't fired and that his departure was not related to the investigation.
According to attorneys involved with the investigation, Donovan has a brother, Peter Donovan, who works for Banc of America Securities in Boston and the two brothers traded with each other often.Preferential trading is one issue that regulators are closely investigating.
In December, Fidelity said it disciplined 14 employees who violated its gifts and gratuities policy and that it was "considering strengthening our procedures" and "enhancing our compliance oversight" in circumstances where a Fidelity investment employee has a relative who works at a company that does business with Fidelity.
The company said that its own internal investigation revealed no instances where family relationships led to harm to fund shareholders.