More investment firms are adopting policies to address compliance with the SEC pay-to-play rule, according to a recent survey conducted by the Investment Adviser Association, the ACA Compliance Group, and Old Mutual Asset Management. The survey of 555 firms found that 43% of firms reported adopting pay-to-play policies as part of larger compliance policies, and 38% reported adopting stand-alone pay-to-play policies. Both of these numbers represent increases over last year’s survey (38% and 32%, respectively).
Other key findings:
- The number of firms that apply these policies to all employees increased from 68% last year to 76% this year; only 12% limit their policies to Covered Associates;
- 23% of firms extend their policies to spouses and family members of Covered Associates;
- 60% of firms require pre-clearance of Covered Associates’ political contributions;
- 7% of firms prohibit all political contributions;
- 60% of firms require periodic compliance certifications by employees;
- 35% of firms require new employees to list all political contributions.
You can find Covington’s summary of the SEC Pay-to-Play rule here. We have also compiled a detailed 50-state survey of state pension fund and investment fund pay-to-play rules. To find out more about our state survey or pay-to-play compliance policies generally, contact us.