On September 3, 2026, the Securities and Exchange Commission (“SEC”) voted to propose rescinding in its entirety Rule 206(4)-5 under the Investment Advisers Act of 1940, the agency’s longstanding “pay-to-play rule” applicable to investment advisers. If finalized, the proposal would eliminate the most significant federal political law compliance regime for
Continue Reading SEC Proposes to Repeal Longstanding Pay-to-Play Restrictions on Investment AdvisersSEC
Election Year Reminder: Pay-to-Play Risks Are Easy to Miss and Costly to Fix
Posted in Pay-to-Play
It’s a common scenario: An employee receives a text from a friend asking them to contribute to the campaign of a candidate the friend supports. Without thinking much about it, the employee makes a $500 contribution. Though the employee has been trained on their company’s political contributions policy, it doesn’t…
Continue Reading Election Year Reminder: Pay-to-Play Risks Are Easy to Miss and Costly to FixCovington Announces Pay-to-Play Survey (2026 Edition)
Posted in Pay-to-Play
Covington is pleased to announce that it has revised and updated its comprehensive 50-state survey of pay-to-play laws for 2026.
Companies doing business with the federal government or state and local governments and companies operating in regulated industries are subject to a dizzying array of “pay-to-play” rules. These rules effectively…
Continue Reading Covington Announces Pay-to-Play Survey (2026 Edition)Covington Announces Pay-to-Play Survey (2025 Edition)
Posted in Pay-to-Play
Covington is pleased to announce that it has revised and updated its comprehensive 50-state survey of pay-to-play laws for 2025.
Companies doing business with the federal government or state and local governments and companies operating in regulated industries are subject to a dizzying array of “pay-to-play” rules. These rules effectively…
Continue Reading Covington Announces Pay-to-Play Survey (2025 Edition)Three Political Law Landmines for Hedge Funds, Private Equity Funds, and Investment Firms
By Zachary G. Parks & Derek Lawlor on
Posted in Pay-to-Play, SEC Pay-to-Play
Last year, an asset manager with offices in New York, Texas, and Vermont was publicly censured by the Securities and Exchange Commission and ordered to pay a substantial fine. Its offense? The asset manager hired an individual who had previously made a personal political donation to the campaign of a…
Continue Reading Three Political Law Landmines for Hedge Funds, Private Equity Funds, and Investment FirmsSEC Enforcement Order Highlights Far Reach of Pay-to-Play Restrictions
By Zachary G. Parks & Samuel Klein on
Posted in Pay-to-Play, SEC Pay-to-Play
The Securities and Exchange Commission (SEC) this week issued a cease-and-desist order that demonstrates the SEC pay-to-play rule’s expansiveness and the SEC’s readiness to enforce it to the letter, even when it is virtually impossible that a political contribution could have influenced a government entity’s investment decision.
In this alert…
Continue Reading SEC Enforcement Order Highlights Far Reach of Pay-to-Play RestrictionsSEC Commissioner Says It’s “Past Time” To Reform Overly “Blunt” Pay-to-Play Rule
By Zachary G. Parks 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…
Continue Reading SEC Commissioner Says It’s “Past Time” To Reform Overly “Blunt” Pay-to-Play RuleIn 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…
Continue Reading In Major Blow To Its Opponents, SEC Pay-to-Play Rule Survives D.C. Circuit Challenge
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…
Continue Reading Investment Adviser Hit With $100K SEC Fine, a Reminder that Public Universities are Covered by Pay-to-Play Rule
Political Law Potpourri—The Consolidated Appropriations Act of 2018
By Susan Leahy on
While the din over a possible government shutdown dominated the headlines, political law played a supporting role in the recently enacted Consolidated Appropriations Act (Pub. L. No. 115-141). The content and omissions of the so-called “Omnibus” spending bill will be of interest to political actors in all sectors,…
Continue Reading Political Law Potpourri—The Consolidated Appropriations Act of 2018