At 91%, the overwhelming majority of retail investors support a fiduciary standard for all financial advisors, according to a survey of 2,012 investors polled in August by Infogroup/ORC.

The survey indicates that there is some surprise among investors—seventy-six percent, to be exact—that their financial advisors aren’t, strictly speaking, acting in their best interests now as fiduciaries.

Some 97% of investors agree with the statement (and 85% strongly agrees) that “when you receive investment advice from a financial professional, the person providing the advice should put your interests ahead of theirs and should have to tell you upfront about any fees or commissions they earn and any conflicts of interest that potentially could influence that  advice.”

Rather than carve out exceptions for certain types of investment salespeople, as groups representing broker-dealers tend to argue for (see Advisor Groups Spar Over Fiduciary Solution), 96% of investors say everyone selling investments, including insurance agents selling annuities, should be held to a fiduciary standard.

Speaking at a press conference, Mary Wallace, senior legislative representative for AARP in Washington, D.C., laid out the finding in no uncertain terms. "Some in the securities and insurance industries would have you believe that the issues being discussed today about the appropriate regulatory standard for investment advisors and brokers is complicated and needs more study,” she said. “But, from the investor perspective, it actually is quite simple: Every financial professional who offers investment advice should be held to a fiduciary standard when they offer that advice.” 

“Investors are basically clueless,” added Barbara Roper, director of investor protection for the Consumer Federation of America. “They do not understand the differences in services being provided. This lack of understanding is not because investors are stupid. It is because the policy itself is stupid.”

The study, commissioned by The Consumer Federation of America; AARP, North American Securities Administrators Association, CFP Board of Standards and the Investment Adviser Association, was meant to remedy an imbalance, as the group sees it, to the deluge of industry-driven responses to the Securities and Exchange Commission’s comment period on the fiduciary standard. The SEC has received more than 2,500 responses during the open comment period, but relatively few have come from the investing public.

“Most of the investors who come into my office with complaints about brokers and advisors are not the type to fire off letters to the SEC,” said Denise Voight Crawford, president of the North American Securities Administrators Association and Texas Securities Commissioner, who participated in the call. “They are busy raising families and trying to make ends meet. We know what they want and what they deserve. They expect a fair deal when getting advice about their investments.”

The main presenters presented compelling arguments, but a nagging issue arose during the call, however. Rand study in 2008 concluded pretty much the same thing—that investors were very confused about the distinctions between investment advisors who operate under the fiduciary standard and everyone else. The Rand study got a lukewarm reception from the industry, because it did not suggest a policy action.

Still, as the Securities and Exchange Commission undertakes its six-month study on the differences between the fiduciary and suitability practice standards, proponents say things could be different this time.

Nevertheless, said David Tittsworth, executive director of the Investment Advisors Association, the SEC could take these findings seriously. “If you look at the lineup of the SEC today, it is different from what it was in 1999,” he said. “This survey is the type of information the SEC can and should consider.”