Tags: romney | blind | trust | goldman

Critics: Ann Romney Blind Trust Invested in Questionable Site

Tuesday, 03 Apr 2012 11:09 AM

 

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A blind trust in the name of Ann Romney, wife of Republican U.S. presidential hopeful Mitt Romney, was an investor in a fund run by Goldman Sachs Group Inc that had invested in a media company which critics say facilitates sex trafficking.

While there is no suggestion the Romneys knew about the investment, the disclosure highlights the difficulty for politicians and their families when they invest in blind trusts that are supposed to protect them from conflicts of interest and ethical questions.

According to an August 2011 financial disclosure report by the Romneys, Ann Romney's blind trust had an investment valued between $15,001 and $50,000 in Goldman's GS Capital Partners III.

Goldman said on Sunday that GS Capital Partners III signed a deal last Friday to sell its 16 percent stake in Village Voice Media, which owns the website Backpage.com, back to management.

Critics argue that Backpage.com facilitates the trafficking of underage prostitutes and sex slaves, although others question that.

Andrea Saul, a spokeswoman for Romney, stressed that the funds were managed on a blind basis, "so the trustee, not the Romneys, make their investment decisions."

"Furthermore, the trustee invests in funds, but, as a passive investor, has no control over the funds' investments."

Goldman's divestiture is the latest development in a growing controversy over online adult advertising that has pitted celebrities, law enforcement officials, members of Congress and New York Times columnist Nicholas Kristof against Village Voice Media.

The private media company has the largest share of revenue in the United States from online advertising of adult services.

It has responded aggressively, challenging critics' data with editorial investigations and claiming that it goes to far greater lengths than competitors in cooperating with law enforcement and monitoring its ads for illegal activity.

The original size and timing of the blind-trust investment were not disclosed, though in 2007 the Ann Romney trust reported during Mitt Romney's previous failed attempt to get nominated as Republican presidential candidate that its investment in the Goldman fund was then worth between $100,001 and $250,000. In Ann Romney's 2010 tax return, which was made publicly available in January, the trust's investment in the Goldman fund was reported as showing a $28,226 loss.

Goldman could not be immediately reached for comment on questions about the Ann Romney trust investment. GS Capital Partners III invested $30 million in the Village Voice in 2000. This was a fraction of fund's capital, which totaled $2.78 billion.

Goldman Sachs said the fund lost the vast majority of its investment when it sold its Village Voice stake last week.



© 2014 Thomson/Reuters. All rights reserved.

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