The District of Columbia’s new pay-to-play law will take effect on November 9, 2022. As we blogged about here, the Campaign Finance Reform Amendment Act of 2018 prohibits certain campaign contributions by contractors doing or seeking to do business with the D.C. government. This prohibition applies to entities holding or seeking contracts worth an
pay-to-play
SEC Commissioner Says It’s “Past Time” To Reform Overly “Blunt” Pay-to-Play Rule
By Zachary G. Parks & Mathias Heller on
The U.S. Securities and Exchange Commission (“SEC”) last week announced settlements with four investment advisory firms regarding alleged violations of the SEC’s pay-to-play rule, illustrating that federal regulators continue to aggressively pursue such cases. The rule at issue, Rule 206(4)-5 (“the Rule”), prohibits investment advisers from, among other things, receiving compensation from certain government entities…
Covington Releases 400-Page, 50-State Survey of Pay-to-Play Rules (2022 Edition)
Companies doing business with state and local governments or operating in regulated industries are subject to a dizzying array of “pay-to-play” rules. These rules effectively prohibit company executives and employees (and in some cases, their family members) from making certain personal political contributions. Even inadvertent violations can be dangerous: a single political contribution can, for…
In Major Blow To Its Opponents, SEC Pay-to-Play Rule Survives D.C. Circuit Challenge
By Zachary G. Parks on
Posted in Litigation, SEC Pay-to-Play
The U.S. Court of Appeals for the D.C. Circuit yesterday issued a long-awaited opinion upholding, on the merits, a recent update to the SEC’s pay-to-play rule. While the case involved only a narrow piece of the rule, the decision’s logic is worded more broadly and could apply to the SEC rule as a whole, making…
The Top 10 Political Law Red Flags for M&A Deals
By Zachary G. Parks on
Posted in Political Law
During the diligence process that precedes a merger or acquisition, investment firms and corporations should pay careful attention to political law risks. Political laws are notoriously complex, are often not intuitive, and even seemingly minor or technical violations of these rules can result in significant penalties and reputational harm. These risks are especially acute when…
The Top 10 Political Law Red Flags for M&A Deals
By Zachary G. Parks on
Posted in Political Law
During the diligence process that precedes a merger or acquisition, investment firms and corporations should pay careful attention to political law risks. Political laws are notoriously complex, are often not intuitive, and even seemingly minor or technical violations of these rules can result in significant penalties and reputational harm. These risks are especially acute when…
Investment Adviser Hit With $100K SEC Fine, a Reminder that Public Universities are Covered by Pay-to-Play Rule
By Kevin Glandon on
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…
First Significant Pay-to-Play Legislation for the District of Columbia Approved by D.C. Council
By Kevin Glandon on
Posted in Pay-to-Play
On December 4, the D.C. Council unanimously approved the first significant pay-to-play law for Washington, D.C. The restriction would apply to contractors with—or seeking—one or more contracts with an aggregate value of $250,000 or more. The legislation will be considered by the Mayor and would be subject to a 30-day period of congressional review.
The…
Election Law Compliance for High Net Worth Individuals and Family Offices
By Zachary G. Parks on
Posted in Campaign Finance
With less than one month to go before the 2018 elections, the ground is shifting for major political donors. Developments over the last several years, and especially in the last few months, show that the rules of the road are changing with respect to many of the common election law issues faced by high net…
Survey of the Pay-to-Play Laws of the United States
By Zachary G. Parks & Kevin Glandon on
Companies doing business with state and local governments or operating in regulated industries are subject to a dizzying array of “pay-to-play” rules. These rules effectively prohibit company executives and employees (and in some cases, their family members) from making certain personal political contributions. Even inadvertent violations can be dangerous: a single political contribution can, for …