Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

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Monday, August 3, 2009

SEC Publishes Proposed "Pay to Play" Rules for Investment Advisers

The SEC published on its website for public comment proposed new rules that address “pay to play” practices by investment advisers. The new rules would prohibit an investment adviser from providing advisory services for compensation to a government client for two years after the adviser or certain of its executives or employees make a contribution to certain elected officials or candidates. They would also prohibit an adviser from providing or agreeing to provide, directly or indirectly, payment to any third party for a solicitation of advisory business from any government entity on behalf of such adviser. Additionally, the new rules would prevent an adviser from soliciting from others, or coordinating, contributions to certain elected officials or candidates or payments to political parties where the adviser is providing or seeking government business. The Commission also is proposing rule amendments that would require a registered adviser to maintain certain records of the political contributions made by the adviser or certain of its executives or employees.

Public comments are due 60 days after publication in the Federal Register.

http://lawprofessors.typepad.com/securities/2009/08/sec-publishes-proposed-pay-to-play-rules-for-investment-advisers.html

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