TIME Pakistan

Pakistani Protesters Storm State TV Station as Fresh Clashes Erupt

PAKISTAN-UNREST-POLITICS
Pakistani supporters of politician-cleric Muhammad Tahir ul-Qadri and cricket turned politician Imran Khan shout antigovernment slogans after storming the headquarters of the state-owned Pakistani Television in Islamabad on Sept. 1, 2014 Aamir Qureshi—AFP/Getty Images

The attack comes just hours after the military calls for a peaceful solution to the political stalemate

Protesters stormed the headquarters of Pakistani Television (PTV) in Islamabad on Monday, taking it off air and beating up the station’s journalists, according to Reuters. The attack follows a bloody weekend in the Pakistani capital.

“They have stormed the PTV office,” an anchor said just before the transmission abruptly ended, Reuters reported. “PTV staff performing their journalistic duties are being beaten up.”

Paramilitary forces and soldiers later secured the station, which resumed broadcasting. Protesters left peacefully.

The storming of PTV came as fresh clashes erupted between stick-wielding protesters and police on Monday morning, just hours after the nation’s powerful military called for a peaceful solution to the political stalemate, according to Agence France-Presse.

Demonstrations against the government have been led for weeks by cricket icon turned opposition politician Imran Khan and outspoken politician-cleric Muhammad Tahir ul-Qadri, in a bid to remove Prime Minister Nawaz Sharif from power.

Khan insists that Sharif’s government finagled its way into office through rigged elections last year, and insists that the Prime Minister must resign, and fresh elections set, before the protests end.

The demonstrations that commenced in normally sleepy Islamabad on Aug. 15 have increasingly turned violent.

At least three people were reportedly killed over the weekend as protesters attempted to move deeper into the so-called red zone, where Parliament and executive offices, along with the Prime Minister’s residence and several embassies, are located.

On Monday, Khan urged his supporters to refrain from further violence in the wake of the recent bloodshed, according to Reuters.

“I call upon my workers to remain peaceful,” said Khan, addressing crowds from the top of a shipping container serving as a makeshift stage. “Do not carry out any acts of violence. God has given us victory.”

Domestic news outlet Dawn reports that the embattled Prime Minister and Pakistani army chief General Raheel Sharif are meeting in Islamabad to discuss the crisis.

TIME Hong Kong

China: No Open Nominations for Hong Kong Leader

Activists Take To The Streets As China Votes On Hong Kong Election Process
Protesters take part in a rally during the beginning of the Occupy Central movement outside the Central Government Offices in Hong Kong on Aug. 31, 2014. Lam Yik Fei—Getty Images

China's legislature on Sunday ruled against allowing open nominations in elections for Hong Kong's leader, a decision that promises to ignite political tensions in the Asian financial hub

Updated: Aug. 31, 2014, 8:40 a.m. E.T.

(BEIJING) — China’s legislature on Sunday ruled out allowing open nominations in inaugural elections for Hong Kong’s leader, saying they would create a “chaotic society.” Democracy activists in the Asian financial hub responded by saying that a long-threatened mass occupation of the heart of the city “will definitely happen.”

The legislature’s powerful Standing Committee said all candidates should be approved by more than half of a special nominating body in order to go before voters. That’s at odds with demands from Hong Kong’s pro-democracy camp, which staged a massive protest in July to press for genuine democracy in the Chinese territory over fears candidates would continue to be screened to assess their loyalty to Beijing.

Following the committee’s widely expected decision, pro-democracy supporters rallied in a park in front of Hong Kong government headquarters.

Hong Kong has enjoyed substantial political autonomy since returning from British to Chinese rule in 1997, when China’s communist leaders pledged to allow the city’s leader, known as the chief executive, to be eventually elected through “universal suffrage” rather than by the current committee of mostly pro-Beijing tycoons. But China’s growing influence in the city’s affairs has sparked fears that Beijing won’t hold up its end of the bargain.

Li Fei, deputy secretary general of the National People’s Congress’ Standing Committee, told a news conference that openly nominating candidates would create a “chaotic society.”

“These rights come from laws, they don’t come from the sky,” he said. “Many Hong Kong people have wasted a lot of time discussing things that are not appropriate and aren’t discussing things that are appropriate.”

Hong Kong’s most high-profile democracy group, Occupy Central with Love and Peace, immediately announced that a plan to “occupy” the city’s Central business district would go ahead, without specifying a date.

“OCLP has considered occupying Central only as the last resort, an action to be taken only if all chances of dialogue have been exhausted and there is no other choice,” the group said in a statement. “We are very sorry to say that today all chances of dialogue have been exhausted and the occupation of Central will definitely happen.”

Occupy Central has vowed to rally at least 10,000 people for the massive sit-in, which could still be months away because Hong Kong’s government must hold more consultations on Beijing’s guidelines and then formulate a bill to be passed by the city’s legislature. The group urged legislators to vote against it and “start the constitutional reform process all over again.”

Making clear that Chinese leaders intend to tightly control politics in Hong Kong, Li reiterated that candidates for chief executive should be loyal to China’s ruling Communist Party.

“He has to be responsible to Hong Kong and to the central government,” Li said. “If Hong Kong’s chief executive doesn’t love the country and love the party, then that can’t work in one country.”

Under Sunday’s guidelines, Hong Kong’s 5 million eligible voters will be able to vote in 2017 for two to three candidates selected by the 1,200-member nominating committee. Then, the chief executive-elect “will have to be appointed by the Central People’s Government,” the Standing Committee said.

“Since the long-term prosperity and stability of Hong Kong and the sovereignty, security and development interests of the country are at stake, there is a need to proceed in a prudent and steady manner,” it said.

Willy Lam, an expert on Chinese politics at the Chinese University of Hong Kong, said that the requirement that a candidate is supported by more than half of the nomination committee “will rule out a pan-democratic candidate.”

“Only if it’s lowered to 20 percent can a pan-democratic candidate get in,” as there could be enough political diversity in the committee to back a more democratically minded person, Lam said.

Beijing’s announcement comes after a summer of protests and counter-protests that have gripped Hong Kong, including a rally two weeks ago by pro-Beijing activists to denounce Occupy Central as threatening the city’s stability.

Political tensions spiked in June when Chinese officials released a policy “white paper” declaring that Hong Kong’s “high degree of autonomy … comes solely from the authorization by the central leadership.”

Many read the policy paper as asserting Beijing’s dominance of Hong Kong’s affairs and hit the streets and the Internet in protest. Occupy Central drew Beijing’s rebuke by organizing an online referendum that received nearly 800,000 votes on how to pick the city’s chief executive.

On Sunday, organizers of a similar referendum in the neighboring Chinese-controlled city of Macau said 95 percent of 8,688 people had voted in favor of its leader being elected by universal suffrage in 2019. Macau’s incumbent leader, Fernando Chui, was elected to a second five-year term by a Beijing-friendly committee on Sunday.

___

Associated Press writer Louise Watt contributed to this report.

TIME republicans

Women Find GOP ‘Intolerant,’ Report Says

The Republican Party's elephant symbol is seen on display on October 24, 2000 at the Republican campaign headquarters in El Paso, Texas.
The Republican Party's elephant symbol is seen on display on October 24, 2000 at the Republican campaign headquarters in El Paso, Texas. Joe Raedle—getty Images

A gender gap persists

Female voters have sharply negative views of the Republican Party, according to a new report of internal polling done by major GOP groups, the latest sign of the gender gap facing the party as it tries to recapture the White House in 2016.

Politico, which obtained a copy of the Republican polling, reports it found that many women consider the GOP “intolerant” and “stuck in the past.” The Republican groups that commissioned the polling, the Karl Rove-led Crossroads GPS and the American Action Network, hosted eight focus groups over the summer and survey about 800 registered women voters. Pollsters found that 49% of women have an unfavorable view of Republicans, while just 39% feel the same about Democrats, Politico reports. The establishment-friendly GOP groups are warning that Republican elected officials “fail to speak to women in the different circumstances in which they live” They’re advising officials to champion equal pay policies, and suggesting Republicans change the way they handle the issue of abortion: “Deal honestly with any disagreement on abortion, then move to other issues,” the report says.

Republicans are expected to easily keep their majority in the House and may even recapture the majority in the Senate during the coming midterm elections. But the gender gap will be more troublesome in the 2016 presidential election, especially if Hillary Clinton is the Democratic nominee.

[Politico]

TIME 2016 Election

Pro-Clinton Group Touts Her Record on Women

Celebrity Sightings In New York City - July 30, 2014
Hillary Clinton is seen arriving at The Carlyle Hotel on July 30, 2014 in New York City. Alessio Botticelli—GC Images/Getty Images

Hillary Clinton’s shadow campaign emphasizes her empowerment of women

A group dedicated to defending and promoting Hillary Clinton’s record ahead of a possible 2016 presidential bid used Women’s Equality Day to tout her record of promoting women Tuesday.

The group Correct the Record released a two-page document entitled “Breaking Glass: Women’s Economic Empowerment.” The document, given exclusively to TIME, looks at Clinton’s work to promote women’s and girls’ issues as Secretary of State. The issue was Clinton’s top policy priority. The push came after her failed 2008 presidential bid, during which she didn’t highlight the historic nature of her candidacy until the end of the campaign, famously saying only in her concession speech that her bid to be the first female president represented “18 million cracks in the glass ceiling” for the 18 million votes she’d received in the primaries.

Many Clinton advisers who’d worked on the campaign have said in retrospect that they wished they’d emphasized the historic opportunity she had to be the first female president earlier. Clinton lost the women’s vote in 16 state and territorial primaries to Barack Obama. Already this time, Ready for Hillary, another arm of Clinton’s shadow campaign, has focused on outreach to female voters as a priority.

Correct the Record’s promotion of Clinton’s record also speaks to that push, highlighting the work that she’s done to further women and children globally. The group notes that Clinton created the office of Ambassador-at-Large for Global Women’s Issues and raised women’s issues at all international economic forums. She launched the Equal Futures Partnership to advance women in politics and the private sector. Along with Asian Partners she pushed through the San Francisco Declaration, an agreement to realize women’s economic potential. With help from Middle Eastern countries she launched the Strategic Dialogue with Civil Society, which brought together and empowered activists in the region to work on women’s economic and political. In Latin America and the Caribbean she launched WEAmericas to help women grow small businesses. In Africa, she created the African Women’s Entrepreneurship Program to help train women qualify for the African Growth and Opportunity Act, a trade agreement that gives privileged trade status to certain African countries and businesses. And she directed the Invest for the Future program in Southern and Eastern Europe and Eurasia to focus on women’s entrepreneurship.

“Hillary Clinton championed such unprecedented and impassioned work at the State Department to advance women’s entrepreneurship and empowerment that it would take an entire book to fully chronicle her efforts,” said Adrienne Watson, a spokeswoman for the group. “Correct The Record put together this ‘Breaking Glass’ record analysis to highlight Clinton’s many successes, including several multilateral partnerships and programs which raised the profile of women’s issues and resulted in greater economic engagement of women around the world.”

TIME Thailand

Thai Junta Leader Assumes Prime Minister Post

Prayuth Chan-ocha
General Prayuth Chan-ocha speaks after he accepted a written royal command issued by King Bhumibol Adulyadej certifying his appointment as the country's 29th Premier in Bangkok on Aug. 25, 2014 Thai Spokesman Office—AP

Prayuth, who is expected to name his Cabinet next month, has said elections could be held in 2015

(BANGKOK) — Thailand’s junta leader, who seized power in a military coup three months ago, officially assumed his new post as prime minister on Monday following an endorsement from the country’s monarch.

During a ceremony in Bangkok, Gen. Prayuth Chan-ocha accepted a written royal command issued by King Bhumibol Adulyadej certifying his appointment as the country’s 29th premier. Bhumibol, who is 86 and in poor health, was not present at the ceremony.

Thailand’s junta-appointed legislature voted overwhelmingly last week to name the 60-year-old army chief to the new post. He was the only candidate.

Prayuth is due to retire from the military next month and will hold both jobs until he does so.

On May 22, Prayuth oversaw a coup in which the military toppled Thailand’s elected civilian government. Analysts say his new post cements the military’s control of government.

The move was the latest in a series of moves by the junta to consolidate power on its own terms. In July, the military adopted a temporary 48-article constitution and appointed the legislature.

Prayuth, who is expected to name his Cabinet next month, has said elections could be held in 2015.

Prayuth has said the army had to stage the coup to end half a year of political deadlock between protesters and the government, and to stop sporadic protest-related violence that had killed dozens of people and wounded hundreds more. While stability has been restored, it has come at a steep price: Thailand’s democratic institutions have been entirely dismantled, and the country’s authoritarian rulers have crushed all dissent.

Last week, Human Rights Watch issued a statement criticizing the deterioration of human rights in the country.

“Since the May coup, the generals have tightened rather than relaxed their grip on power,” said Brad Adams, Asia director at Human Rights Watch. “Instead of the promised path back to democracy through free and fair elections, Thailand’s military seems to be opting for a road to dictatorship.”

“As both prime minister and junta leader, Gen. Prayuth can wield broad power without accountability,” Adams said. “This marks a dark day for human rights and the future of democracy in Thailand.”

Associated Press writer Todd Pitman contributed to this report

TIME justice

Students Challenge Texas Voter ID Law in Court

A voter completes her ballot on November 6, 2012 in Fort Worth, Texas.
A voter completes her ballot on November 6, 2012 in Fort Worth, Texas. Tom Pennington—Getty Images

Trial set for September

Students in Texas have a question for their state lawmakers: Why us? In September, they’ll get to pose that question in court.

Over the last year, laws that advocates say place unnecessary burdens on voters have advanced across the country. But a law in Texas is causing a particular stir due to its potential to place the harshest burdens on the youngest voters. A lawsuit challenging it that was filed last year goes to trial Sept. 2.

“We work to engage people—young people—in this process,” said Christina Sanders, state director of the Texas League of Young Voters, which is among the plaintiffs in an upcoming voter identification case in the state. “The hurdles these laws create makes it more difficult for us to engage.”

“More than cases of apathy, it becomes a case of disenfranchisement,” she added.

For Sanders and the Texas League of Young Voters, the Supreme Court’s Shelby County v. Holder decision—which nullified key portions of the landmark Voting Rights Act—has given them a case of judicial déjà vu. The group’s first action after its founding in 2010 was joining in the initial challenge to the law that restricts the type of identification voters can use at Texas polls, a lawsuit that prevented the measure from taking effect in 2012. But because of the Supreme Court’s decision that invalidated the portion of the Voting Rights Act used to block the law, it was able to take hold almost immediately after the high court’s ruling. The NAACP’s Legal Defense Fund, on behalf of the League, joined the Department of Justice lawsuit last year in an effort to once again seek refuge from the law in the courts.

The state has said the ID requirement is an effort to prevent in-person voter fraud. In a 2013 editorial, Texas Attorney General Greg Abbott said requiring voters to present government issued IDs is “the first step in the process is to ensure that only those that are legally allowed to vote actually vote.” He called the efforts to block the law misguided, noting that some 83% of adults and 84% of registered voters support voter ID laws, according to a 2013 McClatchy-Marist poll.

“To those that oppose voter ID laws, how about instead of trying to incite racial violence and protests, you walk the walk and help those you believe to be poor or disenfranchised without photo ID to acquire a photo ID,” Abbott said.

Under the law, seven forms of identification are accepted at Texas polling stations, among them state drivers’ licenses and identification cards, election identification certificates, military IDs, passports, citizenship documents with photos, and concealed handgun licenses. And noticeably absent from that list: student identification cards.

In Texas, voter turnout for youth was among the lowest in 2012 at 29.6%, according to the Center for Information and Research on Civic Learning and Engagement (CIRCLE) at Tufts University. But voting rights advocates worry these laws will only further discourage young people from voting in the state. Between 600,000 and 800,000 voters may be ineligible to vote under the Texas law, many of whom may be students given the fact that nationally only about 65% of 18 year-olds have licenses, according to a 2011 University of Michigan study.

Ryan Haygood, director for the Legal Defense Fund’s political participation group, said student IDs were specifically left off the list because they fail to prove whether a student is a citizen or a resident, though he said there have been no instances of student non-citizens attempting to vote in person.

“There are two ways you can win an election, get more people to participate or get less of your opponents potential voters to participate,” Haygood said. “These laws prey on groups that have been historically marginalized.”

About 45% of eligible 18 to 29 year-olds voted during the 2012 presidential election, casting over 20 million votes, according to CIRCLE. That rate was a bit below the 51% mark from from 2008 but an overall boost compared to the 15 million cast in 2000.

Sanders said preventing students from using their state college IDs to vote causes “an extra hurdle,” and one many advocates don’t understand.

“We haven’t heard really good rationale for it,” said Dale Ho, director of the American Civil Liberties Union’s Voting Rights Project. While states have argued that because student IDs often do not have addresses they can’t verify residence, voter ID laws, Ho said, are justified not as a means of confirming residence, but a way to confirm identity.

“It doesn’t make any sense to exclude student IDs on the basis of an address,” he says. “It leads us to think the only reason why they’re excluding student IDs is that they don’t want students to vote.” Younger voters tend to vote disproportionately Democratic, and laws passed in Texas and elsewhere increasing restrictions on student IDs have been pushed by Republicans.

And the Lone Star state isn’t the only state where the student vote may be at risk. As the New York Times reported in July, students in North Carolina have filed a lawsuit saying the state’s restrictive voting measures, which also prohibit the use of state university IDs at the polls, violate the 26th Amendment—the one that says the right to vote “shall not be denied or abridged by the United States or any sate on account of age.”

TIME Congress

Sen. John Walsh Plagiarized Final Paper for Master’s Degree

John Walsh
Sen. John Walsh, D-Mont., speaks during an event in the Capitol Visitor Center on the importance of the Land and Water Conservation Fund, July 23, 2014. Tom Williams—CQ-Roll Call,Inc.

A Walsh campaign spokeswoman says the plagiarism was a "mistake"

Montana Democratic Senator John Walsh plagiarized portions of a final paper required for his Army War College master’s degree, which he earned in 2007 at the age of 46, his campaign confirmed Wednesday. The charges endanger the Democrats’ control of the Senate as the Republican Party is attempting to pick up a net six seats this fall.

As first reported by The New York Times, Walsh passed off passages of his 14-page paper, titled “The Case for Democracy as a Long Term National Strategy,” as his own, without proper attribution to Harvard University and Carnegie Endowment for International Peace documents. Walsh told Jonathan Martin, a Times reporter, that he did not plagiarize, but an aide did not contest the charge, according to the Times article.

Lauren Passalacqua, a Walsh campaign spokeswoman, told TIME in a statement that the plagiarism was a “mistake.”

“This was unintentional and it was a mistake,” wrote Passalacqua. “There were areas that should have been cited differently but it was completely unintentional. Senator Walsh released every single evaluation that he received during his 33-year military career, which shows an honorable and stellar record of service to protecting Montana and serving this country in Iraq.”

Walsh served in the Montana National Guard for over 30 years before winning Montana’s lieutenant governor race in 2012. Earlier this year, after President Barack Obama nominated Sen. Max Baucus (D-Mont.) to be the next ambassador to China, Gov. Steve Bullock appointed Walsh to the Senate. Walsh is currently running for another term in the Senate against Republican Rep. Steve Daines.

Outside election experts have given the edge to Daines. The Charlie Cook Report ranked the race as “lean Republican” in June, and Kyle Kondik, the managing editor of Sabato’s Crystal Ball, recently wrote that the seat was one of the three best Republican pickup opportunities in the Senate. Walsh has been gaining on Daines, however — a recent poll by the left-leaning Public Policy Polling showed that Walsh had trimmed an early 17-point Daines advantage down to seven points.

TIME Hong Kong

Hong Kong, China’s Freest City, Grapples With Political Reform

HONG KONG-CHINA-DEMOCRACY
Demonstrators rally against the Occupy Central movement to show their support to the Hong Kong government in Hong Kong on July 15, 2014. Hong Kong's government has unveiled its vision for electoral reform as public pressure for democracy grows and activists pledge to take over the city if their demands are not met Philippe Lopez—AFP/Getty Images

An official, 100-plus-page report to Beijing on Hong Kong's political development is unlikely to satisfy the city's increasingly frustrated democracy activists, but Hong Kongers are beginning to tire of confrontation

Two weeks ago, tens of thousands of Hong Kongers — perhaps even hundreds of thousands, depending on whose estimates you believe — marched for the right to nominate candidates for the city’s top job. Civil nomination, as it’s locally known, would make Hong Kong the only place on Chinese soil with such a free and open manner of choosing its leader.

On Tuesday, they were flatly told by their current leader, Chief Executive Leung Chun-ying (or “C.Y.,” in the Cantonese fashion for abbreviation), that future Chief Executives would not be elected that way. Instead, there would be incremental changes of the existing system, under which candidates are put forward by a nominating committee and then voted on by an electoral college (which presently consists of just 1,200 establishment types but could be expanded). This method of doing things, Leung said, represented “mainstream opinion” in Hong Kong.

Hong Kong’s democratic camp was livid. “We’re pretty disappointed — we’re pretty angry,” Johnson Yeung, an activist with the Civil Human Rights Front, which organizes the annual July 1 protest march, told TIME on Tuesday night. “The Chief Executive is telling lies about the majority of society. The majority of people support civil nomination.”

Leung was speaking on the release of the findings, which will be submitted to Beijing, of a five-month public consultation on the city’s constitutional development. The process was made up of town-hall meetings — between nervous officials and often fractious members of the public — and a review of written submissions from individuals and groups, of which nearly 125,000 were received. As a view-gathering exercise, it was undeniably thorough and when Leung says that it has “truthfully collected views of the people of Hong Kong,” he isn’t just politicking.

At the same time, reformists claim — also with some justification — that their voices deserve more prominence. Besides the support for civil nomination expressed on the July 1 march, they also point to an unofficial, civil-society-backed referendum in June in which nearly 800,000 people voted on their preferred methods of choosing their leader, with civil nomination being involved in each of those methods. Leung only indirectly referred to the march and the referendum in his report — referring to views other than those that have been officially gathered is a rookie political error when dealing with Beijing, and yet they remain glaring lacunae in the eyes of many.

The truth about what Hong Kong people want is, of course, more nuanced. There can be little doubt that Hong Kong’s well educated, sophisticated and forward-looking population would like as much say as possible in determining how the territory is governed. But at the same time, the number of those who have the appetite for a protracted political confrontation with Beijing must be very few. And confrontation it will be, for the simple fact that civil nomination is not permitted under Hong Kong’s miniconstitution, known as the Basic Law, which came into effect when Britain returned sovereignty of Hong Kong to China in 1997. Say what you like about China, but it is a scrupulous observer of formal agreements.

Hong Kongers — sober, decent, pragmatic and hardworking — are mostly not the sort of people who gravitate to the barricades and the streets. Neither do they need to be made aware of the political realities of having China as a sovereign power, for the simple fact that postwar Hong Kong has only ever existed with China’s permission. In the 1960s, the local joke was that Mao Zedong could send the British packing with a mere phone call.

With that vast, brooding power lying just over the Kowloon hills, tiny Hong Kong’s style has always been to play China cleverly — to push where it can (in matters such as education and national-security legislation, where it has won important battles) and to back off where it cannot. When establishment figures talk of having, as Chief Executive, “a person who loves the country and loves Hong Kong” it is coded speech, referring to somebody who is a master of that game and who is not like, say, Leung Kwok-hung (no relation to C.Y. Leung) — a radical legislator who hurls objects around the debating chamber and who once set fire to the Chinese flag. The election of somebody like Leung Kwok-hung to the position of Chief Executive would be the only excuse Beijing needs to employ repressive machinery far beyond anything Hong Kongers have imagined. The threat of the Occupy Central movement to bring Hong Kong’s financial district to a standstill if its demands for civil nomination are not met will also play beautifully into Beijing’s hands.

A compromise is being offered. Within the constitutional report’s prose are certain suggestions that, while subtle, would mark unprecedented concessions on China’s part, should the National People’s Congress approve them. Namely, C.Y. Leung calls for some amendments to the structure of the controversial nomination committee, which vets potential candidates for the Chief Executive election, that may render it a more democratic grouping.

“I see that as a concession. I see that as a position that allows for a democrat to get through to the election,” says David Zweig, a professor of social science at the Hong Kong University of Science and Technology. “General public nomination — it’s not going to happen. It can’t comply with the Basic Law.”

And that, in the end, is the peculiar agony of Hong Kong — to be a city of politically mature individuals that was simply handed back from one sovereign power to another, without any consultation, unable to determine its fate. Today, it is culturally, legally, historically and linguistically distinct from the rest of China, but it will never be able to parlay that into greater autonomy than what it presently enjoys. It will always be a subject territory.

It turns out that many Hong Kong people only want to get on with their busy metropolitan lives and are O.K. with that. They do not want to choose between democracy or death, and that political realism is itself an important milestone. In that sense, when C.Y. Leung said, “Today is a historical moment in the constitutional development of Hong Kong, we will be able to leave our differences behind in a rational and pragmatic way,” he was absolutely right.

With reporting by P. Nash Jenkins / Hong Kong

MONEY financial advisers

Political Campaigns Can Be Hazardous for Financial Advisers

Political campaign supporters
Blend Images - Hill Street Studi—Getty Images

A Pennsylvania firm agreed last month to pay a $300,000 fine after the SEC alleged it had violated campaign-contribution rules.

Election season is under way, which means opportunities are mounting for public retirement plan advisers to do the wrong thing.

Investment advisers and certain employees who donate to many types of political campaigns are not allowed to advise state and local governments for two years, according to a 2010 U.S. Securities and Exchange Commission rule. Advisers who stray over that line can face tough consequences.

The SEC’s “pay-to-play” rule is in place to prevent advisers from using campaign contributions to persuade state and local governments to hire them. States, municipalities and government agencies typically have their own versions.

Advisory firms that fail to follow those rules can face hefty penalties.

In the SEC’s first such enforcement case against an investment adviser, TL Ventures Inc agreed on June 20 to pay nearly $300,000 to end charges that it received advisory fees from state and city pension funds after one of its associates had donated to a Philadelphia mayoral candidate and the Pennsylvania governor in 2011.

The Wayne, Pa., private equity firm neither admitted nor denied the SEC’s allegations.

The case is rattling advisers, said New York lawyer Jisha Dymond, who counsels companies and candidates about political law.

MANY MINEFIELDS

Advisers must also slog through other versions of pay-to-play rules from individual states and municipalities, Dymond said.

Among the concerns: conflicts between the rules. In New Jersey, for example, advisers to public pensions cannot contribute to state political party committees. But the SEC does not impose that restriction, Dymond said. Advisers can, however, get in trouble with the SEC for pushing others to contribute to political parties.

“In an election year, there’s so many different ways to hit a trip wire in terms of compliance,” Dymond said.

In the coming months, gubernatorial elections will be held in 36 states and U.S. three territories, according to the National Governors Association. That is in addition to state and municipal elections slated for November.

The SEC rule applies mainly to advisory firm executives and employees responsible for snagging business from state and local governments.

It typically does not involve federal elections, such as U.S. Senate campaigns for November midterm elections. But it could kick in when a state governor runs for a federal office. That is because he or she can still influence the selection of state financial advisers, said Ronald Jacobs, a Washington lawyer who specializes in political law.

ELECTION PREP

Now is an ideal time for firms that advise pensions to review their campaign donation procedures and the various rules, lawyers say.

Remind employees who fall under the rule that the firm’s compliance staff must approve their contributions in advance, said Jacobs.

Some advisers simply ban contributions. “It’s easier than trying to figure out nuances,” said Stefan Passantino, a Washington lawyer who advises companies and candidates on pay-to-play issues.

But that might be overkill, Jacobs said. Many advisory firms limit their business to a specific state or municipality, or their employees live in a certain area. That makes it easy to decide which rules apply.

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