Report: N.Y. AG investigating Romney's Bain Capital
NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman has reportedly subpoenaed more than a dozen firms, asking for documents that would show details about their tax strategies.
Among those firms subpoenaed: Mitt Romney's own Bain Capital, the New York Times reported Saturday.
Romney, the Republican nominee for president, co-founded Bain in 1984. The company, headquartered in Boston, specializes in private equity, venture capital, credit and public market investments.
Since its inception, Bain has invested in or acquired hundreds of companies. Among them: Burger King, Clear Channel Communications, Domino's Pizza, Dunkin' Donuts, The Sports Authority, Staples, Toys R Us, Warner Music Group and The Weather Channel.
According to the Times, some of the other firms subpoenaed include Kohlberg Kravis Roberts and Company, TPG Capital, Sun Capital Partners, Apollo Global Management and Silver Lake Partners.
The newspaper reported that Schneiderman, a Democrat, is seeking documents that would show whether the firms converted certain fees collected from investors into fund investments.
Such investments are taxed a much lower rate, the Times noted.
Schneiderman's office has declined to comment on the report.
However, New York's GOP chairman, Ed Cox, told the New York Post Monday that the attorney general's investigation of Bain is "blatantly political."
"The timing of the release of information on the investigation of private equity firms by someone whose involvement in the Albany Democratic sexual-harassment scandal is going to be investigated by (state) JCOPE (Joint Commission on Public Ethics) is blatantly political," Cox told the newspaper.
"This issue is something the IRS, which is responsible for tax payments, has looked at. This has been a longstanding practice by almost half the private equity firms out there, and for Schneiderman to do this now is just another example of the attorney general abusing his office for political purposes and harming the economy of New York City and New York State."
Cox contends Schneiderman -- who was selected earlier this year by President Barack Obama to co-chair a national mortgage crisis unit aimed at investigating home lending by banks -- is trying to shift attention away from his role in a secret sexual harassment settlement.
Last month, it was revealed that Assembly Speaker Sheldon Silver, a Democrat, approved a hush-hush deal with two former high-ranking members of Assemblyman Vito Lopez's staff, in which they were given more than $100,000 in taxpayer money to avoid further litigation.
Lopez, also a Democrat, gave another $32,000 of his own money to keep the accusations against him quiet.
Schneiderman's office denied any involvement in the deal.
However, emails and other evidence show that lawyers for the attorney general worked with the speaker's staff to craft the settlement, the Post reported.
From Legal Newsline: Reach Jessica Karmasek by email at email@example.com.
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