Publication

“The Outplacement of Placement Agents? SEC Proposes New “Pay-to-Play” Rules”

On August 3, 2009, the Securities and Exchange Commission (“SEC”) proposed new rules under the Investment Advisers Act of 1940 (the “Advisers Act") largely aimed at investment advisers and placement agents to the over $2.2 trillion of assets of public pension plans that, according to the SEC, are “particularly vulnerable to pay to play practices.” The SEC's proposed rules are part of an effort to curb perceived abuses that “can distort the process by which investment advisers are selected and can harm advisers’ public pension plan clients . . . .” This Stroock Special Bulletin looks at the SEC’s proposed rules and some of their implications for financial services firms and others dealing with government pension plans, including asset managers, placement agents, pension consultants and other similar intermediaries.

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