Romney’s Bain Woes Boil Down To A Paper Trail That Doesn't Add Up
Official Records Show Presidential Candidate’s Federal Filings Contradict Filings Made With the State of Massachusetts
The mainstream media reports now zeroing in on presidential candidate Mitt Romney’s role at Bain Capital entities after 1999 can be a bit confusing and seem to focus primarily on whether he said one thing publicly yet was doing something quite different behind the scenes.
Specifically, the questions now being raised about Romney’s role with Boston-based private-equity firm Bain Capital and its affiliates after 1999 center on whether he had an active management position with any of those entities while he was at the same time heading up, between 1999 and 2002, the nonprofit Salt Lake Organizing Committee for the Olympic Winter Games of 2002, which took place in February of 2002.
Most of the press reports also focus on Bain Capital filings with the US Securities and Exchange Commission that seem to show he was active in the firm's management after 1999, and what he has said in public statements over the years — in essence, that he had no active involvement in Bain entities after 1999.
From a recent story published by Los Angeles Times reporters:
The SEC documents are significant, because they appear to contradict Romney’s statements — repeated in his latest TV interviews — that he left Bain in 1999 when he was put in charge of the 2002 Winter Olympics in Salt Lake City. Some of the Bain activity underlying the Obama [campaign ad] attacks occurred from 1999 to 2002, when Romney formalized his departure from Bain.
“Now, my understanding is that Mr. Romney attested to the SEC multiple times that he was the chairman, CEO and president of Bain Capital,” Obama said. “And I think most Americans figure if you’re the chairman, CEO and president of a company that you are responsible for what that company does.”
However, there is a much more fundamental problem with the nature of Romney’s involvement with Bain post-1999. And that problem boils down to documents he filed with the state of Massachusetts and with the federal government as part of his current presidential bid.
The information contained in these various documents show why presidential candidate Romney is in so much hot water over the work he did for Bain entities and the claims he made, in sworn statements, in legal filings, including his public financial disclosure for his presidential run, filed with the US Office of Government Ethics.
There is no ambiguity in the fact, if the various statements and filings are examined, that Romney lists himself as working in an "executive" or "managing member" role for various Bain affiliates after 1999, when he claimed in a filing with the US Office of Government Ethics that he had “no active role with any Bain Capital entity” nor has he been “involved in the operations of any Bain Capital entity in any way” since Feb. 11, 1999.
If he can’t reconcile that contradiction, then he is faced with explaining to voters why he lied on a federal financial disclosure document, which is quite a different thing than trying to defend his lose lips on the campaign trail.
Following are excerpts from various statements and filings Romney made with the US government and with the State of Massachusetts.
Executive Branch Personnel Public Financial Disclosure Report filed with the US Office of Government Ethics on August 12, 2011 [Link to document here.]
• "Mr. Romney retired from Bain Capital on February 11, 1999 to head the Salt Lake Organizing Committee. Since February 11, 1999, Mr. Romney has not had any active role with any Bain Capital entity and has not been involved in the operations of any Bain Capital entity in any way."
Romney’s Massachusetts State Ethics Commission Statement of Financial Interests for Calendar Year 2002 [Link to document here.]
Romney became governor of Massachusetts on Jan. 3, 2003.
• Salt Lake Organizing Committee
Position Held: President
Gross Income: Over $100,000
• Bain Capital Inc.
Position Held: Executive
Gross Income: Over $100,000
• Bain Capital LLC
Position Held: Executive
Gross Income: Over $100,000
Massachusetts State Corporation Filing for Bain Capital Investors LLC [Link to documents here: 1999, 2000, 2001, 2002.]
“The name and business address of the managing members of the LLC are as follows:
W. Mitt Romney…”
Separate filings for Bain Caital Investors LLC were all made with the State of Massachusetts on Dec. 10, 2012, for the years 1999, 2000, 2001, 2002 — all listing Romney as a “managing” member.
Annual Nonprofit Tax Filings for the Salt Lake Organizing Committee [Link to documents here: 2000, 2001.]
Following is information from the Year 2000 and 2001 Form 990 Filings for the SLOC [the Salt Lake Organizing Committee] for the Olumpic Winter Games of 2002, held in February of 2002. The SLOC 2000 fiscal year ran from July 1 2000, to June 30, 2001. The SLOC 2001 fiscal year ran from July 1, 2001, to June 30, 2002.
• SLOC Form 990 from 2000:
Lists W. Mitt Romney as President and CEO, working an average of 40 hours a week as President and CEO and earning no compensation or benefits, but being paid $26,180 in expenses. Romney is also listed as being a member of the SLOC Board of Trustees and working on average 3 hours a week for no pay. [There is no breakout of what the expenses were, or if any of the expenses involved reimbursement for travel, lodging or meals related to trips to Boston or other locations where Romeny might also have been taking care of Bain-related business. The IRS would be able to obtain copies of the expense receipts for that period, or Romney could choose to make them public.]
• SLOC Form 990 from 2001
Lists W. Mitt Romney as President and CEO, working an average of 40 hours a week and earning $922,980 in compensation and getting another $476,000 in contributions to his employee benefit plans, and being paid $16,980 for expenses. Romney is also listed as being a member of the SLOC Board of Trustees and working on average 6 hours a week for no pay. [Again, there is no breakout of what the expenses were, or if any of the expenses involved reimbursement for travel, lodging or meals related to trips to Boston or other locations where Romeny might also have been taking care of Bain-related business. The IRS would be able to obtain copies of the expense receipts for that period, or Romney could choose to make them public.]
There is a footnote explaining that Romney’s pay for SLOC for fiscal 2001 “includes compensation paid by 6/30/02 for prior years; payment of compensation was contingent on successful and profitable games.”
In The Footnotes
It also interesting to note that in Romney's filing with the State Ethics Commission in Massachusetts for calendar year 2002, he distinguishes between jobs listed as "employment" and positions held with Bain entities in which he had a "passive" role. A footnote in the filing for those "passive" positions states the following: "This designation indicates that while Governor Romney was listed as a general partner of this entity and therefore, in theory, had management authority, in fact he played no active role in the management of the entity."
The listings in that same Massachusetts ethics filing in which Romney identifies himself as an executive with Bain Capital Inc. and Bain Capital LLC for 2002 include no such footnote, seemingly indicating that he had an "active role in the management" of those busniesses.
The Bain entities in which Romney indicates he was a "passive" leader are as follows: BCIP Associates, BCIP Associates II, BICP Associates III, and BCIP Trust Associates, In each of those he is listed as a "general partner." And for BCIP Associates and BCIP Associates II, the filing shows he received gross income of $100,000 in 2002 at each of those entities.
UPDATE: July 15, 11:45 pm Central
The Romney campaign’s answer to Bain-gate is the counter-attack Obama by accusing him of engaging in “political cronyism."
From the Seattle Times: “Romney's campaign will launch a fresh assault this week accusing President Obama of political cronyism at the expense of middle-class workers.”
The Obama campaign plans to respond, according to the same article, by pointing out the extreme cronyism Romney engaged in while governor of Massachusetts and as part of his leadership of the 2002 Olympic Games, through the Salt Lake Organizing Committee, or SLOC, for which Romney served as president and CEO.
More from the Seattle Times story:
“Obama campaign officials see this as a weak line of attack, in part because, they said, Romney played favorites by steering tax breaks to some companies over others as governor of Massachusetts.
" ‘It's clear that Mitt Romney will do anything to avoid answering serious questions about his tenure as a corporate buyout specialist,’ Obama spokeswoman Lis Smith said. ‘But launching false attacks that only boomerang on his record of cronyism in Massachusetts and the Olympics won't do it.’ "
And, judging by the SLOC’s 2000 and 2001 form 990s [tax forms] filed with the IRS, there will be plenty of material to draw from -- specifically some two pages of listed conflicts of interest.
• “Marriott Hotels is an official supplier of the 2002 Olympic Winger Games. Mitt Romney, the CEO of SLOC, is a member of the Board of Directors of Marriott.” [According to NPR, "the Marriott and Romney families have long been close" and J.W. and Richard Marriott are major donors to Romney's campaign through the super-PAC Restore Our Future.]
• “SLOC entered into a contract with Greater Park City Company for use of the Park City Ski Area during the 2002 Olympic Games. At the time, a member of SLOC’s Board of Trustees was also a member of the Board of Directors of Greater Park City Company….”
• “In October 1998, the [SLOC] Board of Trustees approve a contract with Layton Construction Company for construction services in the building of the speed skating oval. The president and principal shareholder of Layton Construction served on the Board of Trustees of SLOC until February 1999, when he resigned.”
• “Members of SLOC’s Board of Trustees (or their spouses) also serve on the Boards of Directors and/or own companies that operate utility companies, retail gift stores, department stores, hotels and restaurants. SLOC has purchased goods and services from these entities in the normal course of business.”
[You can find the full 990 filings at these links 2000 and 2001.]