U.S. brokerage firms market themselves as putting clients’ interests ahead of their own, but then deny that duty when faced with client complaints, argues a new report from an association of lawyers that represents investors.

The Public Investors Arbitration Bar Association (PIABA) issued a report Wednesday arguing that top U.S. brokerage firms “advertise in public as though they are trusted fiduciaries acting in the best interest of investors and then deny in non-public arbitration cases that they have any such duty to avoid conflicted advice.”

The report contrasts brokerage firm ad claims with the arguments firms make in arbitration proceedings, saying that these claims are “directly at odds with the strikingly different message the firms send to aggrieved investors who file arbitration cases after suffering losses from conflicted advice.”

It concludes that “there is a compelling case to be made for a ban on conflicted advice in order to protect investors.” Indeed, the report comes as both the U.S. Securities and Exchange Commission (SEC) and the U.S. Department of Labor (DOL) are considering the imposition of a fiduciary duty to protect investors.

“In the absence of such a standard, brokerage firms now engage in advertising that is clearly calculated to leave the false impression with investors that stockbrokers take the same fiduciary care as a doctor or a lawyer. But, while brokerage firms advertise as though they are trusted guardians of their clients’ best interests, they arbitrate any resulting disputes as though they are used car salesmen,” the report says

The PIABA also points out that five of the biggest firms have publicly expressed support for a fiduciary standard. Yet, it says that these firms “are every bit as vociferous” as the other four brokerages in denying that they have any fiduciary obligation in arbitration cases filed by investors.

“In this atmosphere of misleading advertising and a complete disavowal by brokerage firms of the same ad claims in arbitration, investor losses will continue to mount at the rate of nearly $20 billion per year until the SEC and DOL prescribe the long-overdue remedy: a ‘fiduciary duty’ standard banning conflicted advice,” said report co-author, Joseph Peiffer, a New Orleans-based arbitration attorney and president of the PIABA.

“Until then consumer confusion and losses will reign as the result of a striking difference between the positions brokerage firms take when soliciting customers and those they take when those customers arbitrate claims against the same firms. This is a huge disconnect that simply cannot be allowed to go on,” he said.

“Investors believe they are doing business with individuals they can trust, because the brokers use titles which imply trust, their advertisements give the impression they can be trusted, and the brokers say they can be trusted to look out for the best interests of their clients. A survey of the major brokerage firms show consistency in the advertising, in the tone they take on their websites, and the impression that they intend to leave on investors,” said the report’s other co-author, Christine Lazaro, director, Securities Arbitration Clinic at St. John’s University School of Law.

“Yet when that trust is breached, a survey of answers filed in arbitrations demonstrate that these same firms disclaim liability when held to account in arbitration, and rely on case law to say no such duty exists. The public face of the firms is that they hold themselves to the highest standards, while the private face of the firms, in the arbitration forum where everything is non-public, is that they are mere order-takers,” she says.