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January 25, 2012 12:35 PM What’s with Romney’s Swiss bank account?

By Steve Benen

Probably the biggest surprise in Mitt Romney’s limited tax-return disclosure was the revelation about a Swiss bank account. Given the bigger picture — including Romney’s cash in the Cayman Islands — this new angle isn’t helping the Republican’s campaign.

According to the former governor’s aides, Romney had $3 million in his Swiss account, held at UBS. Brad Malt, who helps oversee Romney’s investments, said told reporters yesterday, “It was a bank account, nothing more and nothing less.”

Not surprisingly, there are additional questions about why, exactly, Romney had $3 million stashed in Switzerland.

Martin Sullivan, contributing editor of Tax Analysts, a nonpartisan research organization, said he was surprised Romney had a Swiss bank account since such accounts were sometimes used to hide assets. “Why would somebody who knows he’s going to be so visible screw around with a Swiss account?”

That seems like a reasonable question. In fact, Democrats and their allies intend to keep asking it. Here’s a video the DNC unveiled over night:

It followed on the heels of this video from Americans United for Change:

“We know why Mitt Romney closed his Swiss bank account,” the narrator says in the video. “The question is, why did Mitt Romney open a Swiss bank account in the first place.”

Brian Beutler added some additional context, reporting, “Tax experts have noted to TPM in recent days that U.S. law changed shortly before then, to make it harder for U.S. persons to avail themselves of tax havens. Shortly thereafter the IRS gave people secreting their money abroad a time window for compliance. Taking camp Romney at its word, that wasn’t really their concern. Even if the account existed for purposes of diversification that could be politically embarrassing in and of itself, constituting a bet against U.S. currency. But to fully answer the question, we’d need to know if that bank account is declared in the years before the law changed.”

The release of Romney’s 2010 returns were intended to end questions about the Republican’s finances, but it’s actually helped do the opposite.

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.

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  • stormskies on January 25, 2012 12:45 PM:

    Amazing to learn this fucking 'elite' buffoon makes $57,000 bucks EVERY DAY just waking up and doing nothing ..........

    yep, just an everyday guy alright

  • MattF on January 25, 2012 12:46 PM:

    Oh, seriously, it's just a little convenient cash-stash. I mean, what if you get stranded in Berne? What are you going to do?

  • troglodyte on January 25, 2012 12:49 PM:

    Interesting. What if the dozen tax returns that Romney gave to McCain in 2008 (to vet his vice-press case) didnt report the Swiss account that appears in the 2010 return? Is that why Romney cant show the American people the same tax returns that he gave McCain's campaign in 2008?

  • Jimo on January 25, 2012 12:49 PM:

    I seem to remember multiple WSJ editorials denouncing pressure from the U.S. and others on Switzerland to be more cooperative with bank account identities as a means to detect tax fraud. Switzerland gave in eventually. Maybe that, not political concerns, is what inspired the Romney move to close the Swiss accounts.

    Detail question: where did the Swiss money go? Do we know it came back to the U.S. or did it move even further off the grid? My understanding is that Hong Kong and Singapore picked up a lot of ex-Swiss money after the privacy changes in Switzerland.

  • c u n d gulag on January 25, 2012 12:50 PM:

    Maybe because opening-up Swiss bank accounts is a cool thing for the richest of the rich to do?

    The Cayman's, and other places, are for the johnny-come-latelies.

    You want your old money yodeling, not raggaeing.

    Too voodoo-economicy.

  • zeitgeist on January 25, 2012 12:55 PM:

    someone (a 527 - it couldn't be the official Obama campaign or DNC) needs to do a commercial that starts with grainy video of Romney doing the "Obama wants to turn the United States into Europe!" line.

    then do a screeching stop. And say "Apparently Mitt Romney didn't think there was anything wrong with Europe when he was investing $3 million in Swiss accounts [show map of location of Switzerland] instead of investing it in the United States. But Mitt Romney says we can't expect the "job creators" to pay more taxes -- why not, if they are creating jobs in Switzerland, not helping Americans with good jobs here? Tell Mitt Romney to do the patriotic thing and put his money where his mouth is -- here in America."

    He'd scream about being called unpatriotic, but I guarantee you his numbers would drop (even farther than they already have.)

  • Anonymous on January 25, 2012 12:59 PM:

    The release of Romneyís 2010 returns were intended to end questions about the Republicanís finances, but itís actually helped do the opposite.

    Of course it's going to do the opposite. Romney was perfectly aware of that. Why do you think he was so cagey about it for so long?

  • BillFromPA on January 25, 2012 1:07 PM:

    Willard's whole approach to taxes baffles me. He's been running for Pres since before 2008, it's a given that any such candidate MUST release numerous years worth of tax returns. He could have bit the bullet a few years back and at least pay taxes at a middle class rate, avoid the Swiss Bank and Cayman stuff, then when Newt 'forced' him to do a release, he could have said, 'Look, I paid more than I have to. I could have paid 15% but I didn't. That would have made him into a Working Class Hero in the eyes of the repugs and possibly the indies. Instead he burnished his reputation as a greedy 1% er, out of touch with the majority of America.

  • booch221 on January 25, 2012 1:12 PM:

    Swiss Mitt!

    Believes in America...

  • Mimikatz on January 25, 2012 1:13 PM:

    IIRC it was UBS that was at the center of a sceme to hide assets of US citizens to avoid taxes, with as mentioned a persistent effort to get the Swiss to cooperate. Didn't some people get indicted over this? Even if Romney wasn't involved in that, just buying Swiss Francs for safety, it raises questions. He is going to be dogged by this until he releases returns back to 2000.

    Sure is tough to be rich.

    Obama looked so much larger than his rivals last night. So presidential, competent and even-tempered. It is a real relief after so much BS from the GOP to hear and see him live.

  • JM917 on January 25, 2012 1:18 PM:

    @ zeitgeist:

    I trust that you're working for the DNC or a pro-Obama 527. Right on target! I can't wait for those ads bashing old Europe-bashing Mitt. (Should be "Gott Mitt uns," to add one little letter and a cap to the old-fashioned belt buckle-slogans sported by German and Prussian army troops?)

  • Jo Hargis on January 25, 2012 1:19 PM:

    It's worth noting also that there's been a recent investigation by the US into those Swiss banks, whereby the banks were forced to release the names of US citizens secreting monies in their banks. If people saw this coming down the pike a year or two ago, it could well explain why he rushed to close this account.

    http://www.ira.com/justices-department-investigates-offshore-banks-over-taxes

  • Mimikatz on January 25, 2012 1:20 PM:

    http://www.forbes.com/sites/robertwood/2011/12/03/no-jail-in-ubs-tax-evasion-case/

    Here is a link to one story about UBS and hiding assets.

    How do you type a captcha word that is upside down?

  • DAY on January 25, 2012 1:20 PM:

    $2 mill is chump change. I want to know about the $100 million he transferred to his kids- without paying the gift tax on the money.

  • exlibra on January 25, 2012 1:23 PM:

    "Martin Sullivan, contributing editor of Tax Analysts, a nonpartisan research organization, said he was surprised Romney had a Swiss bank account since such accounts were sometimes used to hide assets."

    Sometimes? Until the -- fairly recent -- scandal with UBS and the change in Swiss laws of disclosure, hiding assets was the first and foremost attraction of Swiss banks, for years and years and years. Being tight-lipped and keeping secrets (no matter whose) is what made Swiss banks popular, not their interest rates.

    And Romney is damned lucky that Obama, contrary to the Repub fear-mongering, is not dragging us into "soshalizmus". In the good old USSR, a discovery of a Swiss bank account pretty much equaled to a death sentence (not to mention total appropriation of all assets by the state)

  • Sgt. Gym Bunny on January 25, 2012 1:30 PM:

    @ zeitgeist:

    I can hear Don LaFontaine's voice already!!!!

  • zeitgeist on January 25, 2012 1:44 PM:

    thanks JM and Sgt. But JM, I believe Benen is the only one a new job offer around here.

    That said, anyone who would like to offer me a crazy amount of money to be a consultant to a PAC (I understand from Newt that consulting can be a pretty lucrative gig) should feel free to contct me here in this thread.

  • HuskerBlue on January 25, 2012 1:51 PM:

    At this stage I'm going to belive that the Swiss bank account was for one primary purpose -- a hedge against a drop in the value of U.S. Currency.

    I had a Swiss bank account in the early 1980's for the same reason. I think I had no more than $100 bucks in it at the time (My total next egg was probably about $1,000 tops, spread out over silver, gold, mutual funds, an annuity fund, and a money market account).

    I'm not discounting the possibility of more nefarious intent, but I prefer to give the benefit of the doubt on this one until more evidence comes available.

  • Fred on January 25, 2012 1:54 PM:

    He had to stash that money; class warfare can get expensive!

  • WestBlue on January 25, 2012 2:26 PM:

    Not to rain on the anti-Mitt parade, but there is another explanation for the Swiss account -- although it begs as many questions as all the other ones. When you have a certain amount of money, and have some assets or controlling interests in entities that have some significant liability, smart accountants often suggest opening an overseas account to avoid complications from America's complicated and erratic tort system. For instance, if you are the managing partner of large holding company that might get sued, US tort law can lock up all assets of individuals pending the outcome of the suit. It doesn't happen often, but there are several cases in which this has happened, and the golf-course chatter solution is to open an overseas account to keep some ready cash in case everything else is locked up.

    I have no idea if this is what Gov. Romney was doing, of course, but it is a possibility. That said, it's still $3 million stashed out of the country which whatever the reason looks exceedingly bad. But it could have been due to good liability protection strategies -- or at least ones favored by the country-club set -- instead of anything more nefarious.

  • zeitgeist on January 25, 2012 2:42 PM:

    HuskerBlue and WestBlue raise valid points but wholly ignore the context.

    Yes, you might make the decision to have Swiss accounts for those very legitimate and rational reasons. Just like it may have been rational for Bain to break up companies and lay off workers. Or Newt may have rational reasons for serial divorces (hey, having been through one, I know that things go on in private relationships that outsiders neither know nor suspect).

    But you and I aren't running for President. You and I aren't inventing attacks on the sitting President that involve using "Europe" as a term of derision. You and I aren't leading a fight against fair taxation of unearned income as "un-American" or unfair to "job creators."

    In short, it really doesn't matter why Mitt has Swiss accounts or if his reasons are lawful, logical, etc. What matters for purposes of a national election is that (a) he is hypocritical on complaining that we may become more like Europe; (b) he is using legal maneuvers for tax avoidance or asset protection that are not available or known to most Americans -- he is leveraging the advantages of being rich, and everyone else has to pay more because of it; and (c) he is idling that money overseas when investment is needed here, and when he is running for an office that includes in the job description being the biggest cheerleader for the USA.

    A lot of people don't run for President because they don't like the trade-offs. This is one of those: you can have Swiss and Cayman accounts. You can run for President of the United States during a recession. It is exceedingly difficult, and with fair and good reason, to do both.

  • rikyrah on January 25, 2012 2:44 PM:

    @ zeitgeist:

    LOVE IT

    LOVE IT
    LOVE IT

  • chi res on January 25, 2012 4:47 PM:

    Jeez, can't a guy keep a little change in a local bank to support his European wives anymore??

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