Fidelity Investments and other asset managers are telling U.S. clients who live outside the country that they can no longer buy or trade mutual funds in their brokerage accounts.Stephen Austin, a spokesman for the financial-services firm, said the change, effective Aug. 1, was prompted by “today’s continually evolving global regulatory environment,” but he said it wasn’t in response to a specific issue.The change will affect about 50,000 accounts, or less than 0.3% of Fidelity’s 20 million accounts, he said.

“Customers will not be forced to sell holdings simply because they live in a foreign country,” Mr. Austin said.

Observers said fund managers are becoming more conservative in the wake of global developments such as the U.S. Foreign Account Tax Compliance Act and other U.S. efforts.

Following large settlements paid to the U.S. by Credit Suisse Group AG CS +0.35% andBNP Paribas SA, BNP.FR -0.40% “Other countries are getting angry about the size of the fines and are grumbling about retaliation,” said Jonathan Lachowitz, a cross-border investment adviser based in Lexington, Mass., and Lausanne, Switzerland.

Mutual funds are regulated differently from other investments and could be a target, he said.

David Kuenzi, an investment manager in Madison, Wis., who works with Americans abroad, said that selling U.S. mutual funds to those investors had long been prohibited. “But it was matter of ‘Don’t ask, don’t tell.’ Now the firms are getting more aggressive about compliance,” he said.

Other fund companies also are changing policies for investors who live abroad.

A spokesman for Putnam Investments said the firm is no longer accepting additional investments into existing accounts held by non-U.S. residents.

The spokesman said the changes were made “in accordance with U.S. anti-money-laundering and ‘Know Your Customer’ policies” and in response to recent tightening of European laws limiting sales of funds not registered in their jurisdictions.

A spokesman for Charles Schwab Corp. SCHW -0.33% said the firm “has made changes and will continue to make changes to our policies” in reaction to regulatory changes but declined to specify them.

In a recent letter to overseas clients, Fidelity said that its prohibition would apply to both Fidelity and non-Fidelity mutual funds, and to exchanges between funds.

However, account holders still will be permitted to reinvest dividends in additional shares of a fund.

Employer-sponsored plans such as 401(k) and 403(b) plans aren’t affected by the prohibition, but individual retirement accounts and Roth IRAs are, the spokesman said.

The letter also said that if an investor has an automatic investment plan with periodic deposits of cash, then the additions can continue but the money won’t be invested in mutual funds. Instead, the funds will be added to the investor’s other “core position,” such as a money-market fund. The letter added that additions to such funds will still be permitted, but that this could change in the future.

The Fidelity spokesman said that account holders’ ability to purchase individual securities or exchange-traded funds varies from country to country.

A spokesman for the Investment Company Institute, a fund industry group, declined to comment.

A spokesman for Vanguard Group said its funds are typically only for sale to people who live in the U.S., although there are some exceptions for investors residing abroad, for example, some people with inherited accounts.

Write to Laura Saunders at