Political Spending Results In Fewer SEC Actions, Lower Penalties [Study]

Regulatory capture and undue influence from political spending are always a concern, but specific evidence of wrongdoing is hard to come by, and most accusations come from a vague sense that some firms (or industries) are getting a better deal than others. In her recent paper Political connections and SEC enforcement, London Business School professor of accounting Maria M. Correia shows that there is a strong statistical correlation between increased PAC and lobbying spending and softer Securities and Exchange Commission enforcement. “Politically connected firms are on average less likely to be involved in an SEC enforcement action and face lower…