About 30 investors told SEC Chairman Jay Clayton that while the SEC’s best-interest customer disclosures are needed by investors as decide which type of investment professional to hire, the agency's proposed document just doesn’t work.

The investors, many of them retirees, said at the agency’s seventh investor roundtable on Thursday that they had difficulty understanding the "Regulation Best-Interest" proposal and the customer relationship summary (CRS) form that goes with it.

The form, meant to educate investors about the difference between brokers and advisors, doesn't provide tools to help investors educate or protect themselves, the investors said.

The group of investors delivered the message not only to Clayton, but to three SEC commissioners and a panel of high-ranking agency managers at the event in Baltimore.

One investor told the crowd he had retired from Johns Hopkins University last year and had to take required minimum distributions from his retirement plan, which prompted him to search for a sales professional. “I had to decide about all the money that was coming in and I realized there are two different levels of investment professionals,” the new retiree said.

“Why couldn’t they all have investors’ best interests at heart?" the investor continued. "A fiduciary standard? That’s what everyone assumes anyway. I was quite surprised that didn’t happen. I just want to know I have the best person available."

This is the seventh SEC investor roundtable where investor confusion was the predominant message consumers delivered to the SEC.

That feedback comes on the heels of expert testing undertaken by a growing number of professional and consumer groups, including the AARP and CFP Board of Standards, which found that the CRS doesn’t work to inform or protect investors, and in fact may give them a false sense of security that brokers operating in their “best interest” are required to make them money.

“We’re doing our own testing,” Clayton told Financial Advisor magazine last night.

That has been a point of contention for advisor and consumer groups, since the SEC has made no expert test results available before the comment period on the proposals closed. Thousands of comments have flooded the SEC on the controversial proposals, which for the first time are supposed to explain to investors the differences between working with a broker who has a suitability or best-interest standard of care and advisors who have a legal fiduciary duty to put client interests first.

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