The SEC, expanding on an investigation being conducted by it and the New York Attorney General, recently asked over two dozen financial firms, pension fund managers, and placement agents for information concerning finders’ fees and other similar payments, as well as the services that are performed in exchange for the payments. Among other things, the SEC is investigating whether such payments may represent an improper means to help investment managers secure pension fund business. The firms the SEC has contacted reportedly include Goldman Sachs, Credit Suisse, UBS, and Bank of America Merrill Lynch.

This comes in the wake of recent charges of a criminal “kickback” scheme to which certain individuals already have pleaded guilty in connection with the New York State Common Retirement Fund, which is New York’s largest pension fund. Also, private-equity firm Carlyle Group agreed to a $20 million settlement payment as well as an overhaul of how it does business with state pension funds. Similarly, at least one other pension fund manager has agreed to return fees it earned in connection with an investment it received from the New York State Common Retirement Fund.

Additionally, the SEC recently proposed a rule under the Investment Advisers Act that would, among other things, bar any person from serving as an investment adviser to a pension fund (or other government client) for a period of two years after that manager or certain of its related persons had contributed to any political campaign of an individual that oversees the fund. Regardless of whether the proposed rule becomes final, the SEC clearly has a strong and continuing interest in keeping up the pressure to ensure that firms selected to manage pension assets are chosen by virtue of their merits, rather than any improper payment or a “pay to play” scheme.