Excerpt: Several recent actions taken by the Securities and Exchange Commission SEC) indicate that there is increasing attention being paid to public pensions ? and not just in their role as institutional investors. While the SEC's proposed restrictions on so-called 'pay to play' activities of investment advisors was not a surprise, an 'informal inquiry' into certain public pension fund activities initiated by the SEC's Division of Enforcement, and the recent announcement of the creation of a new 'Municipal Securities/Public Pension Unit' to look into unfunded and underfunded pension liabilities, among other things, are sounding alarm bells. Even the SEC's acting chief accountant has gotten into the act, expressing concerns with pension plan smoothing activities.

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