Pay-To-Play Regulation Survives a Challenge

A federal court left intact a rule that makes it difficult for some political candidates to raise money from Wall Street.

The Washington-based U.S. Court of Appeals dismissed an attempt to overturn the 2010 Securities and Exchange Commission regulation which bars banks, hedge funds and private equity firms from giving campaign contributions to governors and other state officials.

The decision was a procedural one: the court ruled Tuesday that the two state Republican Party committees who challenged the rule had waited too long to file their lawsuit.

Known as the pay-to-play rule, the SEC regulation prohibits investment advisers from overseeing ...