Mitt Romney, the presidential candidate, would like to be a blank slate. Despite the fact that President Obama’s religion is consistently called into question, Romney’s is off limits. Despite the fact that Obama has proven his eligibility to be president, questioning Romney’s eligibility is off limits. Despite the fact that Romney is running on his business credentials, asking about Bain Capital, the company that provided his business credentials, is off limits. Despite the fact that he is running as a fiscally responsible candidate, asking about his tax returns is off limits. The mere mention of his term as Governor of Massachusetts is off limits. Now we can’t get a straight answer as to when he actually left Bain Capital and that could be a felony.
Official government documents claim that Romney left his post at Bain in 1999, so he could work with the Salt Lake City Winter Olympics. SEC filings, however, list Romney as the sole shareholder, CEO and president of Bain for a full three years beyond 1999. According to Bain financial disclosure forms, Romney was paid a salary during 2001 and 2002.
Politically, these three years could be a liability. They spanned the time of Bain’s greatest controversy, the time when Bain’s corporate clients were infamously going bankrupt or suffering massive layoffs. Throughout the campaign, Romney has distanced himself from the bankruptcies and layoffs by claiming he had nothing to do with them, that he was gone from the company at that time.
(1) What Romney said in this period:
According to a Boston Herald interview with Romney at the time, “Romney said he will stay on as a part-timer with Bain, providing input on investment and key personnel decisions.” (“Romney looks to restore Olympic Pride” Boston Herald 2/12/1999)
When Romney did finally surrender control in mid-2001, the Salt Lake Tribune reported the following: “In so, he gave up control over all of Bain Capital’s voting stock
(2) Interviews with Romney’s wife and his lawyer regarding this period:
In a Boston Globe interview with Ann Romney from November 2000 the reporter learned that Mitt Romney was dividing his time between running Bain and running the Olympics project. “The [Olympics] project is running smoothly now, though still requiring so much of Mitt Romney’s time that he has had to lessen his involvement with Bain Capital, his investment firm.” (“West Wings Sprout,” Boston Globe 11/11/2000). Please note: not end his involvement with Bain, but “lessen it”-precisely as Romney acknowledged in shifting to part-time management involvement in 1999.
Romney’s own personal lawyer has stated that he only became a passive investor in Bain in August of 2001: “[Bradley] Malt, who was designated by the campaign to address Romney’s time at Bain, said Romney finally resigned and reduced his role at the company to that of a passive investor in 2001 when it became clear that he was going to run for Massachusetts governor after the Olympics.” (“Cash, Advice on Tap at Romney’s Old Firm” Washington Post 10/21/2007)
(3) How Romney was compensated from 1999-2001:
In addition to being CEO and owner of Bain in 2001, Romney filed financial disclosures with the state of Massachusetts in 2002 and 2003 stating that for the calendar years 2001 and 2002, he received over $100,000 from Bain Capital Inc. in connection with his position as an executive, and another $100,000-plus in income in 2001 and 2002 from Bain Capital LLC in connection with his position as an executive of that management entity. These are listed alongside his Olympics salary under the Employment category. These documents may be downloaded from the website http://romneyfacts.com.
In other words, these sums represented compensation for service, not the profits from the investment funds which are listed separately on the filings.
(4) What filings with the Securities and Exchange Commission show:
According to the SEC database, there are at least 63 filings with that agency after March 1, 1999 that list various Bain entities and describe them as “wholly owned by W. Mitt Romney.”
So, according to Romney, his wife, his lawyer, Bain Capital and filings with the SEC, Romney was still employed by Bain after 1999. Factcheck called the administration’s claims “weak or non-existent” but offered little rebuttal other than to say that while Romney owned Bain, he didn’t run it. In other words, he received a salary but accepted no accountability?
The Boston Globe reports that Romney’s severance with Bain was not finalized until 2002.
Government documents filed by Mitt Romney and Bain Capital say Romney remained chief executive and chairman of the firm three years beyond the date he said he ceded control, even creating five new investment partnerships during that time.
Romney has said he left Bain in 1999 to lead the winter Olympics in Salt Lake City, ending his role in the company. But public Securities and Exchange Commission documents filed later by Bain Capital state he remained the firm’s “sole stockholder, chairman of the board, chief executive officer, and president.”
Also, a Massachusetts financial disclosure form Romney filed in 2003 states that he still owned 100 percent of Bain Capital in 2002. And Romney’s state financial disclosure forms indicate he earned at least $100,000 as a Bain “executive” in 2001 and 2002, separate from investment earnings.
Factcheck does concede that if Romney lied on SEC forms, he committed a felony. The question, it seems, boils down to the legal definition of “active role.” If Romney was still CEO and sole shareholder in a company, can he maintain a silent role? Does that mean that he is not responsible for ensuring that all of his company’s dealings are legal? The Boston Globe disputes his claim that he didn’t maintain an active role by saying that he created five new investment accounts.
Somehow, I doubt the SEC would allow the CEO, President and sole shareholder of a company to claim no responsibility for that company. In that sense, I suspect that a strong case could be made when Bain claimed that during that time, the company was “wholly owned by W. Mitt Romney,” that Romney was ultimately responsible for the running of the company even if it was true that he wasn’t active in the running of the company. If in fact Romney wasn’t actively involved in the running of the company, why was no one named as being responsible for the company?
While it’s doubtful that felony charges will ever be filed, at the very least, this is just one more way in which Romney manipulates the law to his own benefit. For some, Romney’s business savvy is an asset. For others, his lack of transparency and apparent lack of scruples is a frightening omen for a man who could be put in charge of enforcing the laws of the country.
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