Romney in 1994: Blind trust argument an "age-old ruse"

By Lisa Wangsness, Globe staff

It only took the Democrats a few hours after Mitt Romney released his personal financial filing to dig up an interesting tidbit from Romney's 1994 challenge of Senator Ted Kennedy.

During that campaign, Romney objected to Kennedy's blind trust's purchase in 1981 of a property in Washington D.C., which the trust then leased to federal tenants. Romney called it "a conflict of interest, pure and simple" and rejected Kennedy's argument that he was knew nothing about the trust's investments.

"The blind trust is an age-old ruse," Romney told the Boston Globe in October of that year. "You give a blind trust rules. You can say to a blind trust, don't invest in properties which would be in conflict of interest or where the seller might think they're going to get an advantage from me."

Romney's personal financial filing showed that Romney's trust owned some potentially controversial stocks, including China Petroleum & Chemical, which has links to Sudan, and several gambling companies(including MGM and Harrah's, which were sold).

It also showed that the trustee, Ropes & Gray's Brad Malt, got rid of some stocks that he thought clashed with Romney's political views, including two foreign oil companies with connections to Iran. (At some point, however, Malt was making money for Romney -- or trying to make money for him -- by investing in those companies.)

Like Kennedy, Romney's campaign has responded to questions about those investments by saying that Romney was not aware of the blind trust's contents until yesterday, when the FEC filings were made public. The campaign has also said that Malt tried to align the trust's holdings with Romney's politics "to the best of his ability."

Asked about Romney's 1994 remarks, Romney spokesman Kevin Madden wrote:

"The governor's trust is in fact a blind trust. There is an important distinction bewteen the references you cite. The trustee in charge of executing the governor's assets made it very clear during his explanation of the terms of the administration of the trust that he made transactions that, to the best of his ability, (were) consistent with the governor's public positions and statements.

"For instance, in order to avoid the appearance of any conflict or impropriety, the trustee did not invest in Massachusetts municipal bonds."