If federal regulators move ahead with a plan to impose a uniform fiduciary standard of care on investment advisors and broker-dealers, financial professionals anticipate that the cost of doing business will increase, with a result of higher client fees and more limited services, according to a new survey.

In a poll of more than 2,400 advisors and registered representatives of broker-dealers, the National Association of Insurance and Financial Advisors, which has argued against the need for an expanded fiduciary rule, produced its survey in response to a request from the Securities and Exchange Commission for more data from stakeholders to inform its long-deferred rulemaking proceeding.

"NAIFA members are among the most highly regulated financial professionals on the planet," NAIFA CEO Susan Waters said in a statement. "They build life-long relationships with many clients and rely on clients for repeat business and referrals. Their motivation to look out for the best interests of their clients goes well beyond any regulatory obligation."

The SEC, meantime, has argued that a uniform fiduciary rule is a sensible response to address the confusion among retail investors where different classifications of financial professionals are held to different standards of care when providing personalized investment advice.

In the survey, which NAIFA conducted in partnership with the American College of Financial Services, 84% of respondents said that they anticipate that the cost of doing business will increase should the SEC move ahead with a uniform fiduciary standard.

Among those who are dually registered as broker-dealer representatives and investment advisors, 81 percent anticipate a cost increase, while just under 90% of non-advisor broker-dealer reps believe that compliance costs will rise with the SEC's rulemaking.

A little more than three-quarters of respondents said that they would likely pass along at least some of those costs to their clients, while nearly half suggested that they would limit their practice to investors with a minimum level of assets if the compliance costs rose significantly.

Fifty-one percent of respondents reported that their average client had a household income of between $100,000 and $249,999.

NAIFA's survey comes in response to the SEC's call in March for additional data and comments to inform a cost-benefit analysis weighing the implications of a uniform fiduciary standard.

In comments filed with the commission detailing the new survey, NAIFA cited earlier research that revealed that its members who sell securities spend an average of 526 hours each year on compliance activities, entailing nearly $9,000 in annual expenses related to exams, compliance and staff resources.

In those comments, NAIFA makes the case that its members, whom it describes as catering to "Main Street investors," are already subject to a thicket of regulations from federal, state and industry authorities. Every NAIFA member is a licensed insurance provider, and more than two-thirds are licensed broker-dealer representatives who trade in mutual funds, annuities or other securities. More than one-quarter of members are dually registered as broker-dealer reps and advisors or advisor representatives. Those overlapping services expose members to various levels of oversight from the SEC and FINRA, including the suitability standards that mandate the provision of advice that matches the investor's objectives.

"Under current law, NAIFA members who are registered representatives have an obligation to recommend only those approved investments or investment strategies that are suitable for their clients," the group wrote, arguing that FINRA's suitability standard "requires a registered representative to make only appropriate recommendations based on the client's particular financial situation and financial objectives." The group concluded: "NAIFA members believe the current suitability standard that registered representatives must meet is a strong standard that acts to sufficiently guide and ensure ethical behavior among broker-dealers and their registered representatives."

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