In December, the Securities and Exchange Commission (“SEC”) fined an investment adviser $100,000 for violating the SEC’s pay-to-play rule. The SEC’s rule effectively prohibits investment adviser executives and other “covered associates” of an investment adviser from making political contributions in excess of de minimis amounts ($350 per election if the contributor is eligible to vote … Continue Reading
Just one week ago, a federal court in Colorado held that the state’s system for enforcing its campaign finance laws was unconstitutional. Moving quickly, the Colorado Secretary of state has enacted temporary enforcement rules, effective immediately. Under the new rules, any person may file a complaint, just like under the old system. However, the rules … Continue Reading
In a case with interesting ramifications, a federal court this week struck down major parts of Colorado’s campaign finance enforcement system as unconstitutional. The system at issue, which was created through a ballot initiative, generally allowed any person who believed there had been a violation of the state’s campaign finance laws to file a written … Continue Reading
In a 2014 blog post about the Dinesh D’Souza case, we speculated that it might have been one of the first “straw donor” cases identified based on automated analysis of campaign finance disclosure reports. It’s not clear that was actually the case, though the Department of Justice did say at the time that “the indictment … Continue Reading
Covington today issued the third edition of its Chiefs of Staff manual on handling investigations of Members of Congress and Congressional staff. The manual was originally published in 2014, but has been updated twice since then. The new third edition includes some of the latest available statistics and examples. This manual is intended to advise … Continue Reading
Covington today released an updated version of its manual for Chiefs of Staff to Members of Congress concerning best practices for responding to government investigations of Members and their staff. Titled “A How-To Guide for Chiefs of Staff,” the manual describes how government investigations unfold and the steps that Chiefs of Staff need to take … Continue Reading
The Ferrari carrying former Virginia Governor Bob McDonnell appears to have made a U-turn this week on its way to the federal penitentiary. Covington released today a Client Alert on the Supreme Court’s decision in McDonnell v. United States, a decision which vacated Governor McDonnell’s conviction and redraws the lines for corruption prosecutions. The Court held a public … Continue Reading
A recent settlement between the Massachusetts Office of Campaign and Political Finance (OCPF) and Massachusetts Republican Party may highlight an emerging trend: state parties using federal preemption to avoid strict state campaign finance laws. At issue was whether the Massachusetts Republican Party could use funds from its federal campaign account to pay for staff and … Continue Reading
The Securities and Exchange Commission announced Tuesday that it will allow further comment on a pay-to-play rule proposed by the Financial Industry Regulatory Authority (FINRA). As we discussed previously, if the SEC approves FINRA’s pay-to-play rule, it would clarify that investment advisers are allowed to hire third party solicitors if they are subject to FINRA … Continue Reading
On Friday, the Government Accountability Office (GAO) issued its ninth annual report on compliance with the federal Lobbying Disclosure Act (LDA), covering from mid-2014 through mid-2015. As in the past, the report is based on random audits of lobbyists’ filings and analysis of enforcement by the U.S. Attorney’s Office for the District of Columbia. We … Continue Reading
Yesterday, the FCC released an Enforcement Advisory to remind political campaigns about their obligations under the Telephone Consumer Protection Act (“TCPA”). The Advisory did not set forth any new rules for calls and texts; rather, it confirmed existing rules and reminded political campaigns that they are subject to them. The Advisory first confirmed that prerecorded … Continue Reading
A $12 million settlement announced last week by the Securities & Exchange Commission suggests that the SEC will aggressively pursue alleged schemes connecting political contributions to government contracts even if the political contributions do not violate its 2010 pay-to-play rule. According to the settlement order, in 2010, the head of Public Funds at State Street … Continue Reading
In a rare move, the Securities & Exchange Commission has assessed penalties against a political intelligence firm for failing to adopt adequate policies to prevent the flow of inside governmental information to the firm’s clients. The enforcement action is particularly noteworthy because all the factual allegations took place in 2010, before Congress passed the STOCK … Continue Reading
As Super PACs and campaigns continue to edge closer to the legal line between “independence” and “coordination,” it has become common to hear calls for the FEC to take a stricter role in enforcing the law. Yet as recently reported by BNA, the FEC has not found a single violation of its coordination rules in … Continue Reading
The Wagner case, decided today by the D.C. Circuit, is important because of its analysis of the constitutionality of federal campaign contribution restrictions and, by extension, of pay-to-play laws generally. Covington has been monitoring this case since the district court decision in 2012, to the argument before the D.C. Circuit in 2013, and the decision … Continue Reading
In our discussion of the Securities & Exchange Commission’s (SEC) actions over the past year, we described how the SEC is ramping up enforcement of its pay-to-play restrictions. We also pointed out an acknowledgment by an agency enforcement official that the agency is “actively looking” for violations and that the agency does its own “surveillance.” What kind … Continue Reading
The notion that the House and Senate Ethics Committees are inactive bodies, often implied in media coverage, is far from the truth. During the previous Congress, the House Ethics Committee issued more than 900 formal advisory opinions and addressed more than 40,000 informal requests for guidance. In the first half of the 113th Congress alone, … Continue Reading
In a little noticed decision earlier this month, the FEC announced the settlement of an enforcement case that sets a compliance standard that few companies may currently meet. FEC ADR Case 708 (Marsh & McLennan Companies, Inc. PAC). The outcome is even more surprising because the case involved a single errant donor the company brought … Continue Reading
Yesterday, the Federal Communications Commission’s Enforcement Bureau issued an advisory reminding political campaigns about the restrictions placed on the use of autodialed calls, prerecorded calls, and text messages by the Telephone Consumer Protection Act (“TCPA”) and the FCC’s corresponding rules. The Enforcement Bureau warns that it is “closely monitoring this space” and will “rigorously enforce … Continue Reading
For several years, we have been warning clients and others that it was only a matter of time before we would see criminal referrals against lobbyists who fail to register under the federal Lobbying Disclosure Act (“LDA”). Until now, the U.S. Attorney’s Office for the District of Columbia has focused exclusively — and rarely — on … Continue Reading
An FEC enforcement action recently made public may be of interest to organizations that use members’ dues for political activities. In a complaint to the FEC, a Massachusetts realtor claimed the National Association of Realtors and its state and local affiliates were forcing her into paying for their political activities. The realtor’s local affiliate required … Continue Reading
Two public relations firms have filed documents with the Department of Justice revealing that they provided public relations and media services in the United States for the government of Ecuador without being registered under the Foreign Agents Registration Act (FARA), as that law requires. These firms are the latest in a long string of law … Continue Reading
The Securities & Exchange Commission hit a Philadelphia-area private equity firm today with a major penalty, in the SEC’s first case involving alleged violations of its 2010 “pay-to-play” rules. More enforcement actions may be coming. The SEC pay-to-play rules were adopted to prevent, among other things, executives of investment firms from making political contributions in … Continue Reading
Last week, the Government Accountability Office (GAO) released its 2013 report on compliance with the Lobbying Disclosure Act of 1995 (LDA), summarizing the audits of 104 lobbyist reports and information from the U.S. Attorney’s Office for the District of Columbia. We see several trends in this year’s report. First, registrants are reporting more difficulties complying … Continue Reading
