"SEC Adopts Final Rules on Pay to Play"

On July 1, 2010, the Securities and Exchange Commission adopted Rule 206-4(5) (the "Rule") under the Investment Advisers Act of 1940, as amended addressing "pay to play" practices by investment advisers.  "Pay to play" generally refers to the practices used by investment advisers to influence government officials in selecting an investment adviser to manage public assets (such as pension plans). 

This Stroock Special Bulletin summarizes the Rule and the restrictions it imposes on investment advisers and other market participants.