Mitt Romney is one of the wealthiest men to ever run for U.S. president, thanks in no small part to the retirement agreement he struck with Bain Capital that has the private equity firm continuing to pay him almost 13 years after he left.
Under Romney's retirement agreement, he was to receive a share of the profits split by Bain's partners, both on the funds launched during his time at the firm and on all funds launched in the decade following his exit, albeit the latter at an ever-declining rate. A co-founder of the firm, Romney was also given the right to co-invest alongside Bain's partners.
Romney, who is worth between $190 million and $250 million, according to his campaigns, has not disclosed exactly how much he has earned from Bain since leaving the firm, first to head the 2002 Winter Olympics in Salt Lake City and then to run, successfully, for governor of Massachusetts. Nor is he required to do so. But, according to the 2011 filings he has had to make, Romney may have earned as much as $9.3 million from his Bain assets for the year covered, and his wife earned at least $4.1 million.
In addition to earning a share of the profits on their own co-investments at Bain, and possibly paying only the 15% carried-interest rate on them, according to the New York Times, Romney is still profiting from the explosive growth at Bain after he left. When he retired, Bain had $4 billion in assets under management. Now, it has $66 billion, and Romney remains eligible for a share of the profits earned by all of the firm's funds launched until February of 2009, and will continue to do so until all of them have been wound down.
At least, that is, if he fails in his second quest for the presidency. Should he win the White House next year, Romney will have to rid himself of all of his Bain investments; federal officerholders and not allowed to hold such investments.
While Romney is no doubt happy to enjoy the financial legacy of his Bain years, a picture of him and his fellow Bain partners playing with $20 bills following a successful 1980s fundraising is causing him grief. The Republican hopeful said he knew the picture would be used against him in the campaign, but defended it.
"We were successful in raising our first fund," Romney told Fox News yesterday. "It was about $37 million, an extraordinarily large amount of money that we raised from other people. And we posed for a picture just celebrating the fact that we had raised a lot of money."