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Today marks a milestone in the regulation of political money. It's the 20th anniversary of the first federal pay-to-play rules. These rules, which were enforced by the Securities and Exchange Commission, are a targeted but powerful form of controlling campaign cash. Here's NPR's Peter Overby.

PETER OVERBY, BYLINE: Think pay to play and you might think of video games or high school sports. But in politics, pay to play refers to something totally different, a particular kind of corruption. Ciara Torres-Spelliscy is a law professor at the Stetson University law school in Florida.

CIARA TORRES-SPELLISCY: Pay-to-play practices reward corrupt business dealings.

OVERBY: Specifically, if campaign contributions or other largesse are involved in getting lucrative government contracts...

TORRES-SPELLISCY: The people who lose out on those deals are the people who were trying to get the business through honest means.

OVERBY: The federal pay-to-play rules target the investment firms that handle public pensions and the banks and brokerage houses that underwrite municipal and state bonds. These two sectors are multitrillion-dollar industries that operate in every state. So if a governor runs for federal office, the pay-to-play rules shut down contributions from these financial players.

In 2012, pay-to-play rules affected Texas Governor Rick Perry in the Republican primaries and New Jersey Governor Chris Christie as he was vetted as a possible running mate for Mitt Romney. For 2016, the rules could affect Christie again and New York Governor Andrew Cuomo. Both are said to be considering White House bids.

But so far, one of the biggest pay-to-play cases has to do with state politics in Massachusetts. Back in 2010, the state treasurer, Tim Cahill, ran for governor. A Goldman Sachs vice president was helping his campaign and also lobbying the treasurer's office for underwriting deals on some state bonds. Cahill lost and then after the election...

(SOUNDBITE OF NEWS BROADCAST)

UNIDENTIFIED MAN: The Securities and Exchange Commission, the SEC, has subpoenaed records from former state treasurer Tim Cahill and Goldman Sachs.

OVERBY: That was from Boston TV station WCVB. Under a negotiated settlement, Goldman Sachs paid out $14 million.

STEFAN PASSANTINO: The fact that a penalty of that size can be imposed or consented to by a bank really shows that the SEC is very serious about enforcement.

OVERBY: Stefan Passantino is a lawyer who also tracks pay-to-play laws at paytoplaylawblog.com.

PASSANTINO: I really treated that Goldman Sachs penalty as the warning bell for the regulated community.

OVERBY: Goldman could have fared worse. Washington campaign finance lawyer Ken Gross says the Securities and Exchange Commission could have barred it from doing business with Massachusetts for two years.

KEN GROSS: Banned from millions and millions of dollars of business.

OVERBY: And Gross says it doesn't take much at all to trigger the rules.

GROSS: I mean, literally, a $500, a $1,000 contribution can have that effect.

OVERBY: A $1,000 contribution might be a stretch for a typical household, but it's not much at all in the financial world. And that's just one way the pay-to-play rules spotlight the huge disparity between Wall Street money and ordinary campaign money. Another part of that disparity: The Federal Election Commission has never, under the campaign finance laws, penalized anyone even a third as much as the SEC penalized Goldman Sachs. But attorney Jacob Frenkel says the pay-to-play rules aren't really necessary. Bribery is already illegal. And what's more...

JACOB FRENKEL: In our society, campaign contributions for the purpose of gaining access to candidates is lawful.

OVERBY: No matter if those candidates already hold office. The pay-to-play rules have faced only one constitutional challenge. They survived but as the Supreme Court narrows the scope of campaign finance laws, lawyers say another challenge is likely. Peter Overby, NPR News, Washington.

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