Politico makes a good point about how reporters are having something of a hard time assessing Mitt Romney’s tenure at Bain Capital:
So far, the definitive and comprehensive answers to these questions have proven elusive to even the country’s best journalists because of the very private nature of private equity. The greatest privacy-destroying force known to man — an American presidential campaign — is going head-to-head with one of the most secretive redoubts of the American economy and for now, the door of Bain’s vault is holding.
“Bain, even for a private equity firm, is particularly private,” said Josh Kosman, author of “The Buyout of America: How Private Equity Is Destroying Jobs and Killing the American Economy.” “Most private equity firms are because once you look behind the numbers, there is much they don’t want you to see”…
In November, Josh Hicks, writing “The Fact Checker” column in The Washington Post, tried to verify a common Romney claim: “In those hundreds of businesses we invested in, tens of thousands of jobs net-net were created,” but had to leave its report with “verdict pending.”
“Neither Bain nor the Romney campaign gave us the information when we asked for it,” Hicks wrote. “Bain also declined to answer with a yes or no whether its companies created more jobs than it eliminated during Romney’s tenure.”
— Remember that American Banker investigation that showed how Obama’s Justice Department sat on a HUD investigation that reported banks forced mortgage insurers to pay them $6 billion in kickbacks over a decade?
The Consumer Financial Protection Bureau is taking up the case, the Banker reports. Separately, The New York Times reports that New York’s Department of Financial Services is investigating big banks, including JPMorgan Chase and Bank of America:
(Benjamin) Lawsky’s office issued 31 subpoenas or other legal notices related to the case in early October, just as the state’s insurance and banking departments were merged under his new agency. His office has already turned up instances where mortgage servicing units at large banks steered distressed homeowners into insurance policies up to 10 times as costly as the homeowners’ original plans.
In some cases, those policies were offered by affiliates of the banks themselves, raising questions about conflicts of interest; in other cases, there may have been kickbacks between unrelated companies, according to the person briefed on the investigation.
We don’t know, of course, what role press scrutiny played here. But it sure didn’t hurt.
— Courthouse News Service reports that famed supply-side economist Arthur Laffer, of the Laffer Curve, is being sued for his involvement in a $3 million Ponzi scheme.
Laffer Associates employee told Courthouse News in a telephone interview today that Laffer has severed ties with the Laffer Frishberg Wallace Economic Opportunity Fund.
“He was affiliated with them at one time, but he’s not anymore,” the employee said…
“Mr. Laffer lent his name to Wallace and Bajjali for a fee to increase the credibility of their offerings, and effectively vouched for the credibility of the limited partnerships,” the complaint states.
(h/t Justin Wolfers)
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.