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Obama camp: Romney "blind trust" isn't blind

Romney reports net worth between $190M-$250M
Republican presidential candidate Mitt Romney has filed his annual financial statement. His campaign says he had assets last year of between $190 million and $250 million.

The Obama campaign on Thursday suggested that presumptive Republican presidential nominee Mitt Romney's financial entanglements may create conflicts of interest that impact his policy positions.

The campaign grounded its arguments in two issues: One, the fact that Romney continues to receive payments from his old company Bain Capital, and two, the nature of his so-called "blind trust," which the Obama campaign says isn't really blind at all.

Last week, Romney disclosed that he received more than $2 million in fresh payments from Bain, the private equity firm he ran until 1999. Although Romney says his severance agreement with the company ended in 2009, the payment disclosed last week raised the possibility that he would continue to be paid by the company as president.

The Obama campaign called on Romney to release his retirement agreement with Bain and suggested that he is still tied to the company in some unspecified capacity.

"There has to be some reason for the preferential tax treatment that he is receiving," Obama for America General Counsel Robert Bauer said on a conference call with reporters. Bauer said the fact that Romney is paying a 15 percent tax rate on the income, the tax rate for carried interest, suggests Romney is performing services for the company despite claims that he is no longer tied to it.

University of Colorado law professor Victor Fleischer told CBS News that continued payments from the company to the candidate create a potential conflict of interest.

"It's a direct financial interest that runs from Bain to Mitt Romney, and it's not just the fact that he used to work there, it's not just the fact that he might be friendly to Wall Street generally or finance generally, but it's the direct link between how Bain Capital does as a company and Romney's personal financial interest," he said.

The Obama campaign also spotlighted what Bauer said is Romney's choice "to have a blind trust that is not really quite a blind trust." He said that Romney is not fully screened from his investment decisions because (1) the trust is run by Boston lawyer R. Bradford Malt, his longtime personal attorney, and (2) it would not qualify as a federal blind trust, since Romney has signed off on the broad outlines of his portfolio and thus has at least some knowledge of his investments.

In response to a question from CBS News about whether the Obama campaign was alleging that Romney had conflicts of interest that were impacting his positions, Obama press secretary Ben LaBolt pointed to Malt having sold investments in China and tied them to Romney's public statements.

Jan Baran, head of the Election Law and Government Ethics group at Washington law firm of Wiley Rein LLP, said that even if Romney had a federal blind trust, "all the assets that are put into the trust are known to everybody." He compared Romney's situation to that of wealthy former Senate majority leader Bill Frist, whose grandfather founded Hospital Corporation of America, stating that everyone assumed Frist had investments tied to the company.

"The reason a blind trust is created is to eliminate conflicts even though everyone knows what went into a blind trust," he said.

The Romney campaign, which acknowledged in December that Romney's trust would not qualify as blind under federal standards, called the effort to spotlight the issue "another tired distraction by the Obama campaign, which is frantic to avoid discussing the continued rejection of President Obama's agenda by the electorate and by members of his own party."

"As has been reported for years, Governor and Mrs. Romney's assets are managed on a blind basis. They do not control the investment of these assets, which are under the control and overall management of a trustee," said spokesperson Andrea Saul.

The Romney campaign told the Associated Press on Wednesday that Romney, whose net worth is estimated at between $190 and $250 million, will put his holdings in a federal blind trust if elected.