The U.S. Securities and Exchange Commission has proposed rescinding the investment adviser pay-to-play rule in its entirety, ending the two-year restriction on compensated advisory services to government clients following certain political contributions. The proposal would also remove related recordkeeping requirements for registered investment advisers. The SEC described the rule as overly prescriptive, burdensome and misaligned with its mandate, citing penalties for small donations, consequences tied to contributions made before an employee joined a firm and blanket contribution bans adopted by some advisers. It said pay-to-play risks would remain subject to existing Advisers Act antifraud requirements, fiduciary duties, compliance policies and procedures, and codes of ethics, while political contributions would continue to be governed by applicable election laws and local ordinances.
2026-09-04U.S. Securities & Exchange Commission
U.S. Securities and Exchange Commission proposes full repeal of investment adviser pay-to-play rule
The U.S. Securities and Exchange Commission has proposed fully rescinding its investment adviser pay-to-play rule and eliminating related recordkeeping requirements. The SEC cited implementation burdens and restrictions on political contributions, while pointing to existing antifraud, fiduciary, compliance and ethics obligations as continuing safeguards.