This paper investigates the determinants of the compensation structure for brokers who advise customers regarding the suitability of financial products. Our model explains why brokers are commonly compensated indirectly through contingent commissions paid by product providers, even though this compensation structure could lead to based advice. When customers are wary of the adviser’s incentives, contingent comissions can be an elective incentive tool to induce the adviser to learn which specialized product is most suitable for the specialistic needs of customers. If, instead, customers naively believe they receive unbiased advice, high product prices and correpondingly high commissions can become a tool of exploitation. Policy invervention that mandates disclosure of commissions can protect naive consumers and increase welfare. However, prohibiting or capping commissions could have the unintended consequence of still the adviser’s incentive to acquire information. More vigorous competition benefits consumers and reduces exploitation, but we have limited incentives to educate naive customers.