Average investors who buy mutual funds, insurance policies, annuities and other types of investments work under the assumption that their financial adviser is working in their best interests. This is a false assumption.
It represents everything that is bad about the financial services industry. The other side is the RIAs (Registered Investment Advisers). They represent everything that is good about the financial services industry.
Clients should protect themselves by always asking their adviser straight-up: are you a registered investment adviser? Only those three exact words will tell the tale. And they should get it in writing -- to prove they aren't a muppet.