With limited exceptions, the SEC’s so-called “pay to play” rule – Rule 206(4)‑5 (Rule) under the Investment Advisers Act of 1940 – makes it unlawful for an adviser to provide advisory services for compensation to a government entity for two years after a “covered associate” of the adviser makes a political contribution to a government official who has the ability to influence the agency’s choice of adviser. Notably, the Rule applies regardless of the adviser’s intent or how long the government entity has been a client. A private fund adviser missed this nuance, allegedly violating the Rule when one of its principals made a campaign contribution to a state pension fund official – more than a decade after the pension first invested with the adviser. This article parses the SEC’s settlement with the adviser and Commissioner Hester M. Peirce’s dissent, with additional commentary from Nicholas R. Miller and Daniel G. Viola, partners at Seward & Kissel. See “Fund Managers Must Continue to Guard Against Pay to Play Violations” (Oct. 29, 2020).