While prudence has for some time dictated that hedge fund managers only use registered broker-dealers to solicit investments from public pension funds, the law has not entirely kept pace with prudence.  That is, the term “broker” is defined in Section 3(a)(4) of the Securities Exchange Act of 1934 (Exchange Act) to mean a “person engaged in the business of effecting transactions in securities for the account of others.”  In a series of no-action letters, the SEC has adopted a broad understanding of the term “broker.”  Generally, absent an exemption, any entity that receives commissions or other transaction-based compensation in connection with securities-based activities is required, in the SEC’s view, to register as a broker-dealer.  However, the SEC has recognized a narrow exception to the broker-dealer registration requirement for so-called “finders” (although it is the activities of such entities, rather than their name, that determines the presence or absence of a registration obligation).  Generally, finders are entities that are compensated via a flat or hourly fee for bringing parties together for a potential securities transaction, but that do not receive commissions or other transaction-based compensation for such match-making.  Many of the intermediaries embroiled in the 2009 pay to play scandals styled themselves “finders” or “solicitors” whose activities did not require registration as a broker-dealer.  See “What Do the Regulatory and Industry Responses to the New York Pension Fund ‘Pay to Play’ Scandal Mean for the Future of Hedge Fund Marketing?,” Hedge Fund Law Report, Vol. 2, No. 30 (Jul. 29, 2009).  In part in response to those scandals – or more specifically, to the unregistered status of many of the participants in those scandals – the Dodd-Frank Wall Street Reform and Consumer Protection Act amended Section 15B of the Securities Exchange Act of 1934 to require registration with the SEC by “municipal advisors.”  On September 2, 2010, the SEC adopted temporary Rule 15Ba2-6T under the Exchange Act, which will require registration with the SEC by municipal advisors on Form MA-T by October 1, 2010 (i.e., within three weeks).  Notably, Dodd-Frank explicitly exempts from the municipal advisor registration requirement registered broker-dealers, registered investment advisers and Commodity Trading Advisers registered with the CFTC.