Personal U.S. political contribution pre-hire look back

SEC Pay-to-Play Rule under Investment Advisers Act of 1940

This position with an investment adviser has regulatory reporting requirements.

Review this information and complete the accompanying consent form for the necessary U.S. political contribution (“political contribution”) review. Failure to complete and return the consent form within two business days of receipt may disqualify you from the job for which you are applying, transferring or being promoted or deomoted to.

The U.S. Securities and Exchange Commission (SEC) adopted Rule 206(4)-5 (the Rule) on July 1, 2010 under the Investment Advisers Act aimed at restricting personal political contributions to government officials  who are in a position to influence the award of advisory business. Consequences to investment advisers for violation of these laws can be severe, such as not receiving compensation for advisory services from a governmental client (current or prospective) for two years.

The Rule and its contribution restrictions specifically apply to employees of an investment adviser who are deemed to be Covered Associates. Covered Associate is defined as executive officers and employees who solicit  government entities for the investment adviser, along with those who directly or indirectly supervise such employees.

The Rule has a two year look-back period, effective March 14, 2011 (or in the past two years, whichever is shorter) and going forward. Meaning, advisers must review to determine whether a new Covered Associate has made a triggering contribution within the previous two years for new Covered Associates who solicit clients, or for new Covered Associates who do not solicit clients, within the previous six months. This provision applies to all current employees who are promoted or transferred to a Covered Associate position and external job applicants hired into a Covered Associate position.

Examples of Political Contributions

  • Pay for plate at a reception for a state/local political party with featured speakers. The money raised is typically used by the political party which then provides to their candidates in state/local general elections.
  • Pay to attend a dinner to hear a candidate speak. The money used to help candidate in election.
  • A check written to a state/local candidate and/or official.
  • A check written to a Political Action Committee.
  • A check written to a political party committee at the state or local level
  • Pay to attend a dinner or write a check to a 501(c)(4)  organization.
  • Pay to attend a dinner or write a check to a 501(c)(6)  organization.

Confidentiality

Principal® respects the rights of its employees to lawfully contribute to the political process and will keep personal contribution information provided confidential, subject to the inspection rights of all regulatory and licensing bodies or as any disclosure may become necessary or advisable in the operation of Principal. This includes disclosures at the request of representatives of investors and potential investors who are government clients, pension funds, or their fiduciaries. Information will be centrally retained in a compliance area. Leaders will not have access to information for which they have no business need.

* Required fields

Have you made or do you plan to make any personal political contribution(s) of $150 or more, per election, to any of the groups listed below in the last two years? *

State or local candidate for office, federal candidate currently holding a state or local office, Political Action Committee (PAC and Super PAC), political party committees at the state and local level, Republican party committees at the federal level, Republican National Committee or non-profit 501(c)(4) and 501(c)(6) organizations.
Contribution 1
State, county, and/or city
Primary, general, run-off, special election, and/or other
Money, gift, subscription, loan, advance, deposit and/or other
Contribution 2
State, county, and/or city
Primary, general, run-off, special election, and/or other
Money, gift, subscription, loan, advance, deposit and/or other
Contribution 3
State, county, and/or city
Primary, general, run-off, special election, and/or other
Money, gift, subscription, loan, advance, deposit and/or other

If you have more than three contributions, complete and submit this form again.

By submitting this form, you certify that this report is complete, true and accurate; if you make any political contribution(s) during the hiring process we recommend you limit them to $150 or less, otherwise it will impact potential job offer if a contribution is made that is not permissible; and acknowledge that you understand you will be subject to pre-clearance and contribution limit of $150 for political contributions upon employment.

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Footnotes

Government official is any individual who is elected, appointed or hired by a governmental or quasi-governmental entity. Solicit means with respect to investment advisory services, to communicate, directly or indirectly, for the purposes of obtaining or retaining a client for, or referring a client to, an investment adviser. Example: Pay for plate at a reception for a State/Local Political Party with featured speakers. Money raised is typically used by the Political Party which then provides to their candidates in State/Local general elections. 501(c)(4) organization types typically include civic leagues, social welfare organizations, and local associations of employees. Examples include AARP, Organizing for Action, and League of Women Voters. 501(c)(6) organization types typically include business leagues, commerce, real estate boards. Examples include Chamber of Commerce, American Bar Association, and National Football League.