The intense pressure on the Securities and Exchange Commission to satisfy all sides on the fiduciary standard issue–and to do so at the very tight schedule of six months–was again illustrated last week.
In a survey financed by consumer groups and investment advisor and financial planning organizations, nine out of 10 U.S. investors were said to believe that stockbrokers and investment advisers who provide the same kind of investment advisory services should have to follow the same investor protection rules.
Officials from the National Association of Insurance and Financial Advisors countered that their members believe that the best way to enhance consumer protection is through strong and effective supervision within financial services firms, and regular, periodic inspections by the SEC and other regulatory bodies.
“Not all investors are alike,” said NAIFA president Terry Headley. “There are different needs, different levels of service and different levels of advice required by and available to investors.”
What Your Peers Are Reading
The survey found most investors are confused about which financial professionals are required to operate under a “fiduciary standard” requiring them to put client’s interest ahead of their own.
The groups said they found that the vast majority of U.S. investors believe that all financial professionals providing investment advice should be required to operate under such a pro-investor standard.
The survey is being turned over to the U.S. Securities and Exchange Commission by supporters of the fiduciary standard. The SEC is studying the issue of a uniform fiduciary standard under a mandate issued by the new financial services reform law.
The agency has six months to complete a study of gaps in regulation under the current market conduct standards, and then full authority to publish a regulation that addresses the issue of whether a uniform fiduciary standard is required.