Patterico's Pontifications

9/2/2012

Obama Political Appointee Resigns “Amid Allegations of Inappropriate Sexual Behavior”

Filed under: General — Patterico @ 5:47 pm



He knows how to pick ’em:

A senior Obama administration political appointee and longtime aide to Homeland Security Secretary Janet Napolitano resigned Saturday amid allegations of inappropriate sexual behavior lodged by at least three Immigration and Customs Enforcement employees.

Suzanne Barr, chief of staff to ICE Director John Morton, said in her resignation letter that the allegations against her are “unfounded.” But she said she was stepping down anyway to end distractions within the agency. ICE, a division of the Homeland Security Department, confirmed Barr had resigned. The Associated Press obtained a copy of Barr’s letter.

. . . .

In one complaint, Barr is accused of telling a male subordinate he was “sexy” and asking a personal question about his anatomy during an office party. In a separate complaint, she is accused of offering to perform a sex act with a male subordinate during a business trip in Bogota, Colombia. She’s also accused of calling a male subordinate from her hotel room and offering to perform a sex act. The names of two of Barr’s accusers were censored in affidavits reviewed by AP.

Your jokes and jibes at Obama below.

72 Responses to “Obama Political Appointee Resigns “Amid Allegations of Inappropriate Sexual Behavior””

  1. Find a way to work “Fast and Furious” into your joke for bonus points.

    Patterico (83033d)

  2. Running “Fast and Furious” … ly, from “unfounded” allegations.

    Yep, that’s convincing.

    SPQR (26be8b)

  3. sounds like there was a conspicuous absence of inappropriate sexual behavior really

    suzanne can’t get no satisfaction to save her life it seems

    happyfeet (3c92a1)

  4. Somewhere, in a quiet corner, Bill Clinton is sadly shaking his head…

    Gazzer (c57582)

  5. Her incompetence extended to her ability to command others.

    JD (804352)

  6. Imagine how this would be treated by the Left and MFM were it a Republican. Or a guy.

    JD (804352)

  7. The administration just wants to get this behind them. They freaked out over the “back of my throat” quote in the complaint. Talk about a war on men, this administration really has it.

    What’s weird about this whole thing is everyone assumed Big Sis’s immediate subordinates preferred women to men.

    Corky Boyd (c2186d)

  8. Can we have a pic of this chick. If she’s all that horny I have a friend who will help her out. And he works a lot cheaper than those six figure guys who turned her down.

    f1guyus (877ee1)

  9. I really think the left and the media live in some Bizarro world.

    I think Homeland Security is furiously trying to rein in the fast girls that Napiltano brought in for stuff and giggles.

    Things can go both ways, if you know what I mean. Not that there’s anything wrong with that.

    Ag80 (b2c81f)

  10. Administration sources claim Barr was quoted as saying “she was furious she got caught this fast.”

    daleyrocks (bf33e9)

  11. Napolitano had to get rid of Barr fast after she became furious over latter’s predilections. What with the Dem convention starting and all.

    Ag80 (b2c81f)

  12. The Administration is working furiously to get this out of the news as fast as possible.

    PatAZ (a00d6c)

  13. Yeah, but it was a heterosexual scandal!

    J-Nap (e1d89d)

  14. Suzanne Barr misinterpreted Secretary Napolitano’s directive to give ICE management Hummers.

    daleyrocks (bf33e9)

  15. 6. Imagine how this would be treated by the Left and MFM were it a Republican. Or a guy.

    Comment by JD — 9/2/2012 @ 6:18 pm

    Certainly not like this if it were a Republican:

    Former congressional aide accused of drugging and sexually assaulting women

    A former senior congressional aide was indicted this week in D.C. Superior Court on charges that he sexually assaulted two women after drugging them with a sedative that he allegedly put in their drinks.

    Donny Ray Williams Jr., 36, who served as staff director for a Senate subcommittee and worked in the offices of several members of Congress, gave at least one woman Ambien and assaulted her while she was unconscious, according to court papers.

    Note he’s just a generic congressional aide. And he worked for several generic members of Congress.

    During that time, according to his profile on the LinkedIn Web site, Williams was staff director of a Senate Homeland Security and Governmental Affairs subcommittee.

    Even though they could find his LinkedIn profile.

    We all know what that means. He’s a Democrat.

    And though the Washington Post story fails to mention it: The staffer has worked only for Democrats, including: Senator Mary L. Landrieu of Louisiana, Senator Joe Lieberman of Connecticut, Rep. Jan Schakowskay of Illinois, Senator Herb Kohl of Wisconsin, and Rep. Elijah Cummings of Maryland, among others.

    Additionally, Williams appears to have worked in the Obama administration…

    This employment information is courtesy of Williams’s profile on LinkedIn, which the Washington Post was able to confirm is his account.

    If they have a “D” after their name, man or woman, they report as little information as possible. Even for a man accused of rape.

    They weren’t protecting him, though. They were hiding the fact he worked for Obama and other dems. Even though those facts were on the same LinkedIn profile the WaPo references in their own story.

    Steve57 (40573d)

  16. Remember kids: it pays to know your “fact checkers.”

    Naturally, since he’s a Democrat someone worked fast and furiously to delete that LinkedIn profile. Probably the WaPo itself, to hide it’s journalistic malpractice and do what the reporter editor instinctively did. Protect their party as good, upstanding members of the Democratic media complex. The above link sends you to a cached version.

    Steve57 (40573d)

  17. In the Post defense, according to the LinkedIn profile, he had two different jobs on the Hill,
    and one in at HUD.

    narciso (ee31f1)

  18. All joking aside, I think we should all remember that tomorrow morning, the Bank of American Stadium in Charlotte, N.C. will be hosting the Democratic National Convention.

    I hope all goes well for the Democrats while they participate in the convention at the Bank of America Stadium.

    Maybe Janet Napolitano will show up at the Bank of America Stadium, despite her furious troubles.

    But you would have to be pretty fast to ignore the convention at the Bank of America Stadium. I did hear that Secretary of State Hillary Clinton will not be at the Bank of America Stadium for the festivities, but I’m sure plenty of Democrats will fill the Bank of America Stadium, regardless.

    I can’t tell you how proud the Democrats must be to fill the Bank of America Stadium with their flags and banners. The Bank of American Stadium will have a spotlight shone on it unlike any other stadium, regardless of sponsor. However, in this case, it is the Bank of America Stadium proudly hosting the Democratic Convention. In the Bank of America Stadium.

    So, let no one forget, the Democrats are about to proudly lead us into a new future from Bank of America Stadium. The best damn Bank of America Stadium hosting Democrats ever.

    Ag80 (b2c81f)

  19. I mean it’s a bit of a poser, isn’t it;

    General Deputy Assistant Secretary
    Congressional and Intergovernmental

    April 2009 – Present (3 years 5 months)
    Staff Director
    US Senate Subcommittee on State, Local, and Private Sector Preparedness and Integration

    April 2010 – July 2011 (1 year 4 months)
    Staff Director
    United States Senate

    April 2010 – July 2011 (1 year 4 months)
    General Deputy Assistant Secretary for Congressional and Intergovernmental Relations
    Department of Housing and Urban Development

    April 2009 – October 2010 (1 year 7 months)
    Managed Deputy Assistant Secretary for Congressional Relations , Deputy Assistant Secretary
    Intergovernmental Relations

    narciso (ee31f1)

  20. Yes, I know only the closing will be held in the Bank of America Stadium. Work with me here.

    Ag80 (b2c81f)

  21. Really? Two jobs on the Hill?

    Staff Director
    Senator Mary L. Landrieu

    March 2007 – April 2009 (2 years 2 months)
    Staff Director
    Office of Senator Senator Mary L. Landrieu

    2007 – 2008 (1 year)
    Professional Staff
    Senate Homeland Security and Governmental Affairs Committee

    August 2002 – April 2007 (4 years 9 months)
    Professional Staff
    Office of Senator Joe Lieberman

    2002 – 2007 (5 years)
    Professional Staff
    Senate Homeland Security Committee

    August 2002 – March 2007 (4 years 8 months)
    Legislative Assistant
    and International Relations

    July 2001 – August 2002 (1 year 2 months)
    Legislative Assistant
    Representative Janice Schakowskay

    May 2001 – May 2002 (1 year 1 month)
    Legislative Correspondent/Legislative Aid
    U.S. House of Representatives

    November 2000 – July 2001 (9 months)
    Legislative Correspondent
    Office of Senator Herb Kohl

    January 2000 – May 2001 (1 year 5 months)
    Staff Assistant
    Congressman Elijah Cummings

    1999 – 1999 (less than a year)

    See any Rs there?

    Oh, and at HUD? He was there after he left Landrieu’s staff in March 2009 as a Deputy Assistant Secretary. Who’s administration appointed him to that position?

    Steve57 (40573d)

  22. I am being fair to the WaPo. If a congressional aide who only worked for Republicans did this, that would be in the headline.

    As far as working for the Senate committees, that was when he was on the staff of Senate Democrats. The committees, just like they have to have Democrat and Republican Senators, have to have staffs made up of their aides.

    Steve57 (40573d)

  23. It’s the WaPo that has no defense.

    Steve57 (40573d)

  24. Suzanne Barr misinterpreted Secretary Napolitano’s directive to give ICE management Hummers.
    Might as well close the thread right there.

    Gazzer (c57582)

  25. This story has been in the New York papers (or at least one of them) for weeks – several stories over a period of time. I’ve been thinking when and how to mention it. What happened now is that she finally resigned, after having been on a leave of absence for some time.

    BTW, did you know that the TSA has been guilty of racial profiling – not of Muslims, but of blacks. In Boston.

    Now you may ask, why would they expect to find terrorists by paying special attention to blacks?

    A. They weren’t looking for terrorists!

    Sammy Finkelman (2ae267)

  26. The evidence was mounting; the resignation is a transparent admission of culpability. One victim’s allegations can be dismissed as the mere agitation of a disgruntled employee; when three accusers come forward, you know something’s up. Odd coincidence that all of this went down mere days after I had finished re-reading Michael Crichton’s excellent novel “Disclosure;” a fun read and one of his best works. Women are just as capable of abusing their power in the workplace as men are. Crichton took heat from the feminist crowd for defying the standard conventions and assumptions with respect to that notion, but its truth has been validated many times over.

    Guy Jones (851e14)

  27. 19. I mean it’s a bit of a poser, isn’t it;

    Comment by narciso — 9/2/2012 @ 7:21 pm

    Ahh, you are of course being sarcastic.

    Steve57 (40573d)

  28. Can that Fluke get her job?

    mg (44de53)

  29. Just a nudge, Former Obama administration and Dem congressional staffer, would have been more accurate.

    narciso (ee31f1)

  30. It could have been worse. Just imagine the uproar within the department if it had been Napolitano making these demands.

    Kevin M (bf8ad7)

  31. 29. Just a nudge, Former Obama administration and Dem congressional staffer, would have been more accurate.

    Comment by narciso — 9/2/2012 @ 7:38 pm

    I agree. That’s what I was driving at.

    Steve57 (40573d)

  32. #28

    Then Fluke wouldn’t need birth control?

    steveg (831214)

  33. There’s a worse scandal erupting in the New York state senate, where Democrats were secretly using taxpayer funds to pay off women alleging harrassment by a Democrat state assemblyman.

    SPQR (26be8b)

  34. Suzanne Barr, chief of staff to ICE Director John Morton, said in her resignation letter that the allegations against her are “unfounded.” But she said she was stepping down anyway to end distractions within the agency.

    — Sounds like its time to issue a lifetime ban and demand a blood sample!

    Icy (e071b2)

  35. Her mother, Roseanne, will be very disappointed. (yes, joking…. i think)

    Aaron "Worthing" Walker (23789b)

  36. Whoever her mother is, I’m sure that she’s very proud of her daughter right now.

    (“What did I teach you? If you want to get ahead, you blow the guys ABOVE you in the chain of command!”)

    Icy (e071b2)

  37. And speaking of MENSA member Rosanne Barr, here is the latest bon mot of wisdom from the third-party candidate:
    “most billionaires r violent pedophiles & consumers of violent pedo porn. they get a kick out of being heartless cruel empty cocaine addicts.”

    Icy (e071b2)

  38. R.I.P. Reverend Sun Myung Moon

    Icy (e071b2)

  39. ___________________________________________

    Whoever her mother is, I’m sure that she’s very proud of her daughter right now.

    The biggest, ultimate irony in such scandals dates back to Clinton and Monica, and how the major loudmouths about sexual harassment — referring to women libbers, the NOW crowd — became strangely quiet about or even tolerant towards one of the most notorious sexual players and scammers (which is a nice word for someone who has instances of reported rape hovering in his background) in US history.

    Mark (88885c)

  40. Hey, at least she was going after men!

    From the pics I have been able to find of her, she seems pretty attractive, and while she’s not exactly thin, she isn’t a porker by any stretch of the imagination.

    Which kind of makes me wonder: given the three complaints, and how men normally react to approaches from attractive women, just what kind of a bitch was she that they’d actually complain about it? From The Washington Post:

    In one complaint, Barr is accused of telling a male subordinate he was “sexy” and asking a personal question about his anatomy during an office party. In a separate complaint, she is accused of offering to perform a sex act with a male subordinate during a business trip in Bogota, Colombia. She’s also accused of calling a male subordinate from her hotel room and offering to perform a sex act. The names of two of Barr’s accusers were censored in affidavits reviewed by AP.

    Unless the suggested sex act included a strap-on, while I can see a man deciding to decline the invitation, for any number of reasons, it’s difficult for me to see a man being so offended and upset that he’d make a formal complaint about it. Most men would at least be flattered, even if they declined, unless they saw some sort of threat to their jobs if they did not comply, or she was just such a rotten boss that they saw this as a great way to get rid of her.

    And that’s the serious part of the complaint, that the lovely Miss Barr was creating a hostile and punitive work environment for those who did not comply.

    Let’s be clear here: the Chief of Staff for the Director of Immigration and Customs Enforcement is a person who must hold a high-level security clearance. The Director ICE is going to be the point man on immigration questions, as well as security at our international ports, and that makes him an important part of the war against the Islamists; his Chief of Staff is going to be very much “in the know” about ICE security work. And yet, ICE selected someone so fornicating stupid as to tell a male subordinate, “I want your c*** in the back of my throat.”

    What, with an attitude like that and money to boot, she couldn’t get lucky at a DC singles’ bar?

    She isn’t joining the ever-lengthening unemployment line under President Obama because she was uncontrollably horny; she’s joining that line because she is undeniably stupid.

    The heterosexist Dana (f68855)

  41. Dana, we’re any of the men that she approached married? or had girlfriends?

    Miss Barr IS attractive, but there is something seriously wrong with her, psychologically.

    Icy (e071b2)

  42. “were”

    Icy (e071b2)

  43. Whether they were married or not, I do not know, but that’s why I included, that “I can see a man deciding to decline the invitation, for any number of reasons.”

    Miss Barr IS attractive, but there is something seriously wrong with her, psychologically.

    We probably wouldn’t think so, had she been making these advances away from work, in a single’s bar. Oh, we’d think that she was a slut, surely enough, but it wouldn’t be considered evidence of a psychological problem.

    My diagnosis is simple stupidity.

    The Dana who isn't a psychiatrist (f68855)

  44. “She isn’t joining the ever-lengthening unemployment line under President Obama because she was uncontrollably horny; she’s joining that line because she is undeniably stupid.”

    The heterosexist Dana – Please don’t be so horribly judgmental, Ms. Barr apparently had needs and was looking for someone to satisfy them.

    Is that wrong?

    daleyrocks (bf33e9)

  45. What happens on the road stays on the road.

    daleyrocks (bf33e9)

  46. so what’s the problem
    just one more liberal dem
    gettin’ her freak on

    Colonel Haiku (3d37b7)

  47. REPORT: Obama ‘pioneering contributor’ to devastating subprime lending bubble…

    http://dailycaller.com/2012/09/03/with-landmark-lawsuit-barack-obama-pushed-banks-to-give-subprime-loans-to-chicagos-african-americans/

    Colonel Haiku (3d37b7)

  48. The Icy who isn’t a psychiatrist thinks that anyone who so brazenly crosses that supervisor/subordinate line — especially someone that holds a law degree, and who I guarantee you was required to sign a non-harassment form as a condition of employment — on multiple occasions with multiple victims is, in one from or another, cuckoo for cocoa puffs.

    Icy (e071b2)

  49. Now, having said that, if she just needs someone to tickle her tonsils . . .

    Icy (e071b2)

  50. Icy – C’mon, who here has not gotten a little wasted at an office party and xeroxed their naked butt and faxed it to their boss? Show of hands.

    daleyrocks (bf33e9)

  51. “…she is accused of offering to perform a sex act with a male subordinate during a business trip in Bogota, Colombia…”

    Bogota?
    Did she clear that with the Secret Service first?

    AD-Restore the Republic/Obama Sucks! (2bb434)

  52. 51. “…she is accused of offering to perform a sex act with a male subordinate during a business trip in Bogota, Colombia…”

    Bogota?
    Did she clear that with the Secret Service first?

    Comment by AD-Restore the Republic/Obama Sucks! — 9/3/2012 @ 12:22 pm

    Not to mention the Colombians. I understand you need a special license, annual physical exams, and are confined to certain sections of the city if you’re offering such services.

    Steve57 (40573d)

  53. 45. What happens on the road stays on the road.

    Comment by daleyrocks — 9/3/2012 @ 10:40 am

    Not necessarily.

    Pro tip: never get involved with the boss when she’s a psycho b***h. You just deserve what you’re going to get when she tearfully accuses you of assault.

    And in case any of you are getting any ideas when I say “pro tip,” a fool learns from his own mistakes. A wise man learns from other people’s mistakes.

    I may not be wise, but I’m no fool.

    Steve57 (40573d)

  54. No one deserves epic nonsense from some psycho… even though, and but of course, it is all foreseeable from afar. They say that love at first sight is someone recognizing their Mother or Father.. which is great until the details emerge…

    steveg (831214)

  55. “I may not be wise, but I’m no fool.”

    Steve57 – Well, you might consider investing in a sarcasm meter.

    daleyrocks (bf33e9)

  56. I tried downloading the one that goes with Mozilla Firefox, but it won’t work with my security suite.

    Steve57 (40573d)

  57. Besides, I was riffing off your post mostly to respond to people who were wondering why a man would turn this down. Or file a formal complaint.

    Steve57 (40573d)

  58. Comment by SPQR — 9/2/2012 @ 8:36 pm

    33. There’s a worse scandal erupting in the New York state senate, where Democrats were secretly using taxpayer funds to pay off women alleging harrassment by a Democrat state assemblyman.

    I typed something about this on Monday and today but I think I lost it. That computer is too slow, and once I started it I didn’t want to abndon it and start all over. It’s not really good.

    Well, first of all, it’s the New York State Assembly. The State Senate is Republican for now.

    Assembly Speaker Sheldon Silver is in possible trouble, as is New York State Comptroller Thomas D. DiNapoli, and Attorney General Eric Schneiderman. Both signed off on this, although there is some sort of claim that lower ranking people did it, or they were asked limited questions. Technical questions. Both of these two are former members of the New York State legislature. Schneider was a State Senator from Manhattan and DiNapoli was an assemblyman who was actually intially voted into office by the legislatiure at the very beginning of 2007, when Alan Hevesi resigned shortly after winning re-election. They hadn’t wanted him to do anything earlier because otherwise a Republican might be elected.

    When the legislature votes to replace a statewide elected official, (also I think to pick the Regents) they vote as a joint body, one vote per member, which meant that Assembly Speaker Sheldon Silver basically picked him.

    The State Senate has 61 or 62 – it’s going to 63 now – members and the Assembly has 150. The Republicans have what’s now a wafer thin majority in the State Senate (they actually lost it for a while) and the Assembly has almost a 2/3 Democratic mnajority. All under the constraints of Supreme Court reapportionment law. The wonders of gerrymandering!

    The districts don’t actually have to be the same population – they can deviate maybe up to 5% and before 2010 prisoners in upstate prisons were counted upstate. The republicans also try for a few friendly Democratic State Senators. A few have switched parties over the years. They also drew a district for now convicted crook (and phony) Carl Kruger. This time they created a “super-Jewish” district for Simcha Felder (previously the Jewish population, particularly Boro Park, was split among several districts)
    but they are also trying to elect an actual Republican, David Storobin, who won the special election to succeed Carl Kruger. His posters in Boro Park (I saw them Sunday) say re-elect him, although I think his district has only a small overlap with the older one.

    Sammy Finkelman (d22d64)

  59. Now about that scandal.

    There were actually two different pairs of women this year who complained about sexual harassment by Assemblyman Vito Lopez..

    It broke into the news – On August 24? – when Assembly Speaker Sheldon Silver suddenly removed 71-year old Brooklyn Assemblyman Vito Lopez from the Chairmanship of the Housing Committee, reduced his staff and ordered him not to hire any intern or anyone under the age of 21 or (although the allegations involved women slightly older) There was a quick censure – it actually went through the ethics committee. I think teh zSpeaker may have the power to remove a person from the chairmanship. In any case this not only cost Lopez prestige and power but money, because members of the legislature get extra pay “in lieu of” something for holding different positions, some almost honorary. They are called “lulus” I think this is also true for the New York City Council and in both places the speaker has enormous power.

    It developed that there had been a l

    Sammy Finkelman (d22d64)

  60. Now about that scandal.

    There were actually two different pairs of women this year who complained about sexual harassment by Assemblyman Vito Lopez..

    It broke into the news – On August 24? – when Assembly Speaker Sheldon Silver suddenly removed 71-year old Brooklyn Assemblyman Vito Lopez from the Chairmanship of the Housing Committee, reduced his staff and ordered him not to hire any intern or anyone under the age of 21 or (although the allegations involved women slightly older) There was a quick censure – it actually went through the ethics committee. I think teh zSpeaker may have the power to remove a person from the chairmanship. In any case this not only cost Lopez prestige and power but money, because members of the legislature get extra pay “in lieu of” something for holding different positions, some almost honorary. They are called “lulus” I think this is also true for the New York City Council and in both places the speaker has enormous power.

    It developed that there had been a l

    Sammy Finkelman (d22d64)

  61. It develioped that there had been a lawsuit and asettlement involving two other women earlier this year. Sheldon Silver completely bypassed the ethiocs committee. Theer had even been some changes in the ethics rules this year.

    Initially the two women had sued for $1.2 million. They settled for somethinbg like severance pay. One woman got $60,000 plus and the otehr got $20,000 plus and two law firms got $54,000. The check was actually made out to a law firm. Vitio Lopez kicked in $32,000 of his own money (or what is supposed to be his own money)

    There was also a confidentiality provisions that penalized a woman who talked $10,000.

    Now the (moral and possibly legal) justification for bypassing the ethics committee is that teh women wanted it. Only Gloria Allred popped up to say they didn’t ask for that.

    This caused a problem.

    Sammy Finkelman (d22d64)

  62. In the meantime Vito Lopez was pressured into resigning as Kings County Democratic leader, but he still wants to retain his district leadership and his seat in the assembly.

    He’s running unopposed in the Sept 13 Democratic primary, and while there is a Republican , he’s basically just there so that they have a candidate. Some official from the League of Women Voters didn’t really like the fact that, left alone he’s almost assured of re-election.

    So now they want Vito Lopez to resign from teh Assembly.

    Sammy Finkelman (d22d64)

  63. Sheldon Silver was quoted in the Wall Street Journal today as saying that

    “I think we should not have agreed to a settlement that contained a confidentiality clause. We should have sent the case to the ethics committee regardless.”

    He’s been saying there was a mistake in terms of transparency, but he did nothing that his actions were both legal and moral.

    Asked abouit whether the women didn’t want the case to go to teh ethics committee, he said:

    “I think we’ll have to wait for that information to come out”

    Some people don’t want Sheldon Silver to play as proiminent a role at the Democvratic National convention as he will. He will announce the votes of the new York delegation. Silver said he was doing this for many years, and theer should be no change.

    Silver said Monday that he asked Lopez on Friday to resign but his response was inaudible.

    Sammy Finkelman (d22d64)

  64. In the meantime we have the question of whether criminal charges could be filed against Vito Lopez. Longtime (since the 1989 election) Brooklyn District Attorney Charles Hynes (whom I never liked) who was supported by Lopez and was seeking his endorsement for the 2013 election went into couyrt and got a special prosecutor – the Staten Island DA.

    Sammy Finkelman (d22d64)

  65. Gloria Allred claims it was a violation of satte labor law not to investigate, but I don’t the legislature is like a corporation and an Assembklyman isn’t an employee maybe his staff is.

    Sammy Finkelman (d22d64)

  66. Sammy, you’ve drifted off-topic . . . again.

    Icy (3cd0cb)

  67. Meanwhile New York State Attorney General Eric Schneiderman made public an investigation that could impact on Mitt Romney, if you are not paying careful attention..

    It concerns the question of whether management income was converted into capital gains. Thirteen companies, including Bain Capital, were subpoenaed in early July, and this now became public.

    This involves what is called a fee-waiver conversion – the firms waive the fee and asks them to invest the money instead in certain funds managed by them. Mitt Romney himself didn’t take advantage of this, by the way, although others at Bain did.

    This practice is well known. It’s been discussed in academic papers. The IRS looked into this maybe 5 years ago, or for five years, and decided not to do anything.

    It’s a grey area of the law. Some companies in the same line of business don’t try this.

    This investigation is unusual for New York, because New York State tax law, unlike federal law, does not make a distinction between ordinary income and capital gains. A person familiar with his office’s thinking said review came out of a his office’s newly created taxpayer protection bureau.

    There is also the issue of whether some firms claimed money received wasn’t income but a return of capital.

    This looks very political.

    Sammy Finkelman (d22d64)

  68. “Meanwhile New York State Attorney General Eric Schneiderman made public an investigation that could impact on Mitt Romney, if you are not paying careful attention..”

    Sammy – Your logic makes no sense. You say Romney did not avail himself of this, but it could affect him? How does that work?

    The taxation of private equity has been an issue for years. Whether the carried interests private equity firms receive in sale of interests in portfolio companies are taxed as ordinary income or at capital gains rates has been repeatedly and hotly debated and generated massive campaign contributions from the private equity community in support of their position. This appears to be just the latest skirmish in that battle.

    daleyrocks (bf33e9)

  69. Comment by daleyrocks — 9/4/2012 @ 12:01 pm

    Sammy – Your logic makes no sense. You say Romney did not avail himself of this, but it could affect him? How does that work?

    The same way all the people fired by Bain after he left affects him. Or the dead wife of the steelworker.

    The Democrats make a general statement and you have to go into the weeds to find out it has nothing to do with him personally.

    Sammy Finkelman (d22d64)

  70. Some people might describe that as lying about Mitt Romney..

    Sammy Finkelman (d22d64)

  71. The taxation of private equity has been an issue for years. Whether the carried interests private equity firms receive in sale of interests in portfolio companies are taxed as ordinary income or at capital gains rates has been repeatedly and hotly debated and generated massive campaign contributions from the private equity community in support of their position. This appears to be just the latest skirmish in that battle.

    Is this exactly the same thing as carried interest? The Wall street Journal article today (or other articles I have seen) didn’t use that word)

    Sammy Finkelman (d22d64)

  72. “Is this exactly the same thing as carried interest?”

    Sammy – Not quite. Fund documents normally specify a management fee to be paid to the sponsor of the fund and method for how it is to be calculated. From your description, what the fund sponsors are doing is requesting investors to waive payment of the management fee and instead credit them with an increased ownership interest in the underlying fund or a specific investment now or at some point in the future.

    It is predictable why it raises tax concerns. Constructively, the sponsor in entitled to receive cash compensation, theoretically to offset operating expenses, e.g. salaries of Bain Capital employees. Instead they decide to forego it in return for an additional investment in the fund.

    It sounds like income to me.

    daleyrocks (bf33e9)


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