Over the last week, plenty of ink has been spilled over when precisely Mitt Romney left his position as CEO of Bain Capital. I wasn’t sure why this mattered. I recognize, per this story from the Boston Globe, that Romney’s statement about the timing of his departure matters because of his responsibility for certain companies under Bain’s purview that laid off workers and went bankrupt:
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.
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.
But that just seemed like a little white lie, good for campaign fodder but mostly meaningless beyond that.
However, in this case, Romney is lying about an SEC filing. The statements filed with the SEC list him as the chief executive of Bain after when he stated publicly since way back in 2002 that he left (and that continues – statements from both Romney and Bain today say that he retired in 1999). There are legal implications to this:
Karmel, the former SEC commissioner, said the contradictory statements could have legal implications in some instances.
“If someone invested with Bain Capital because they believed Mitt Romney was a great fund manager, and it turns out he wasn’t really doing anything, that could be considered a misrepresentation to the investor,’’ she said. “It’s a theory that could be used in a lawsuit against him.”
What’s more, Romney has stated on official federal disclosure forms that he left Bain in 1999. If the SEC documents contradict that – and they appear to – Romney committed a felony.
Here’s what Romney has said:
Mitt Romney Public Financial Disclosure Report, Aug. 11, 2011: 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 signature appears on the line that states: “I certify that statements I have made on this form and all attached schedules are true, complete and correct to the best of my knowledge.”
Making false statements to the federal government is a serious crime (under 18 USC 1001) carrying possible fines and up to five years in federal prison.
Politico reports the same thing.
It would appear that Romney either lied to the SEC on disclosure forms there, or lied on separate federal disclosure forms. The Romney campaign has so far rebutted this by saying that SEC forms are idiosyncratic, and that he could have both left Bain in 1999 and still had to sign forms saying he remained the CEO for three years thereafter. Adding to the confusion is that Romney testified before the Massachusetts Ballot Law Commission in 2002, during his race for governor, that he took a “leave of absence” from Bain in 1999, not a full departure.
It’s not totally clear yet whether this constitutes semantic games or a real legal problem for Romney. Either way it doesn’t look great.
UPDATE: I should add that Mother Jones and Talking Points Memo got to the story about Romney not leaving Bain first. But the more important story, to me, are the legal implications, and there I think AmericaBlog nailed it by looking back at that Factcheck information.