The FBI and Securities and Exchange Commission rounded up an insider-trading ring on Thursday, and I imagine that’s the image that most people have when they think of securities fraud: grimy, low-level people skulking around, swapping ill-gotten information. But there’s a more pervasive form of securities-industry nastiness, one that is far more common, far less publicized, and far worse. The most disturbing aspect of this scheme is that it may be legal.

The polite name for it is “pay to play.”

Personally, I call it “bribery.”

That’s the name for a fact of life in the municipal bond and pension fund business: If you’re a bond underwriter or money manager and you want business from a local government, you’ve got to play along. And pay, by making a hefty campaign contribution to the local pols (or their pals) who decide who gets what contract.

While the insider-trading scam dominated the financial headlines, it received far less attention when, on Wednesday, JPMorgan Chase & Co. signed a consent decree with the SEC for alleged pay-for-play transgressions. The company agreed to pay $75 million in penalties and to forfeit $647 million in fees to settle charges that it paid $8 million in an “improper payment scheme” to get a sewer-bond contract in Jefferson County, Alabama. If that sounds stinky, almost like bribery, it’s because that’s what it was—allegedly.

I have to say “allegedly” because the SEC, in keeping with its longtime and incomprehensible practice, levied those hefty penalties—albeit a drop in the bucket compared to JPMorgan Chase’s third-quarter earnings of $3.6 billion—in a settlement in which the company neither admitted nor denied wrongdoing, while at the same time consenting to a cease-and-desist order against ever doing it again—or else!

Yes sir, I’d be scared. Wouldn’t you? I mean, you sure wouldn’t bribe/pay/give an honorarium to somebody to get business if you knew that you might have to pay a penalty of a whopping one fifth of what you earn in three months! And promise not to do it again, let’s not forget. (The irony is that this happens to be a hefty penalty compared to the fines imposed by the SEC in similar situations in the past.)