Investors: All Financial Advisors Should be Fiduciaries
A resounding 97% of 1,319 investors in a recent poll indicated that financial professionals should put investors' interests ahead of their own and disclose fees and conflicts of interest. Under current law, investment advisers are held to a fiduciary standard, but stockbrokers and insurance agents must meet a different suitability standard that investments meet a client's needs, risk appetite and timeline. At least 60% of the respondents (mistakenly) believed that stockbrokers and insurance agents were already acting in a fiduciary capacity.
Under the Dodd-Frank financial reform law, the Securities and Exchange Commission (SEC) must submit to Congress by January 2011 a study about the differences between fiduciary and suitability standards. Click here for a report from Investment News on the investor survey and the fight for fiduciary standards.