The Bain of Romney's Campaign

At first blush, it would seem that either Mitt Romney lied in filings with the Securities and Exchange Commission ("SEC") or he's lying to the public as to when he left Bain Capital.  What has ignited the issue is the Boston Globe story today that carries a sub-headline of  "Firm’s 2002 filings identify him as CEO, though he said he left in 1999."  In addition to the SEC filings, Massachusetts disclosure filings reflect that Romney remained CEO through 2002.  Romney has gone to great lengths to stress that he was no longer with Bain when it bankrupted a number of companies and threw workers to the wolves.  Yes, you read that right, the filings with the SEC seem to indicate that rather than leaving Bain in 1999 as claimed, Romney may have stuck around for several more years.  Here are highlights from the Globe story:

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. 

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.

The timing of Romney’s departure from Bain is a key point of contention because he has said his resignation in February 1999 meant he was not responsible for Bain Capital companies that went bankrupt or laid off workers after that date.

A former SEC commissioner told the Globe that the SEC documents listing Romney as Bain’s chief executive between 1999 and 2002 cannot be dismissed so easily.  “You can’t say statements filed with the SEC are meaningless. This is a fact in an SEC filing,” said Roberta S. Karmel, now a professor at Brooklyn Law School.

The Globe found nine SEC filings submitted by four different business entities after February 1999 that describe Romney as Bain Capital’s boss; some show him with managerial control over five Bain Capital entities that were formed in January 2002, according to records in Delaware, where they were incorporated.

With all due respect and with due recognition of the consequences of filing untrue documents with the SEC (i.e., it's a felony), it would appear that Romney and his campaign are lying.  Andrew Sullivan neatly summarizes the issue this way:

The relevant question is why Romney was listed as CEO and sole owner and chairman for three years after he says he stopped having anything to do with Bain. I don't believe he was SuperMan, running the Olympics and a political campaign while involved in Bain's day-to-day operations. But either you own the company or you don't. And saying one thing to the SEC and another thing to us needs to be reconciled. Even if the shift was abrupt with Romney's departure for the Olympics, it's stunning to see it took Bain three years to correct the record. Legally, Romney is responsible for everything that happened while he was sole owner of the company. Which is what he told the SEC.

A piece in Politico looks at the political turmoil that the Bain issue may be starting to ignite.  Here are some excerpts:

The problem for the Romney campaign, when it comes to the Bain issue, is that things are reaching the point where the facts don’t really matter. The bigger problem is that the Bain cloud now hanging over the former Massachusetts governor is growing daily, and the Romney campaign still hasn’t found a compelling way to respond to what’s becoming the driving narrative, fairly or unfairly, of the 2012 campaign.

After the Globe reported that Romney formally led Bain longer than he’d previously acknowledged — an allegation that Team Romney adamantly contests — Republicans worried that their soon-to-be nominee hasn’t sufficiently answered numerous questions swirling around his Bain tenure.

But Republicans warned that none of that would make Bain go away as a political issue.  “Mitt Romney had an opportunity to answer these questions during the primary,” said Rick Tyler, who ran the pro-Gingrich super PAC that spent millions attacking Romney on the Bain issue. “ He did not answer these questions and now they’re coming up again.”  Tyler warned that the newest Bain twist has the potential to inflict real harm if Romney doesn’t start providing answers.

 Ana Navarro, a Republican strategist who worked for Jon Huntsman during the primary, said the controversy could be solved if Romney were to release his tax returns, acknowledging that no one wants to put their financials out there but that it has become necessary.  .   .   .   “He should just release the stupid taxes and eliminate the Obama campaign tactic of insinuating he’s got something to hide. The Obama people are going to keep the issue alive and it has the potential of mushrooming into a bigger issue,” she said. “It’s time to just pull off the band-aid.”

“It could be a real problem,” said GOP strategist Mark McKinnon. “The accumulation of stories about taxes and Bain and offshore and Swiss accounts and secrecy begin to put glue into the narrative Team Obama is pushing that could make it really start to stick.”

Not answering has the potential to eat away at Romney’s support in swing states.  “We’re starting to see evidence in some of the battleground states that this is working in the favor of the president,” O’Connell said. “There are only so many more of these chinks in the armor Romney can take.”

As I have noted before, the more I see about Romney, the less I like the man whatsoever and I trust him less and less by the day.