More Bain pain for Mitt Romney

Two big stories about Mitt Romney and Bain should be causing him and his campaign a ton of heartburn today. First, the Boston Globe has joined the chorus of those who are calling baloney on Mitt Romney's claim to have left Bain Capital in February of 1999. The headline tells the story pretty well:

I guess traditional media doesn't feel comfortable saying "Mitt lied," but one way or the other, that's what we've got here. Mitt Romney and Bain Capital told investors that he was running the firm as late as 2002. They subsequently created a severance package retroactive to February 1999, but that doesn't change the fact that in 2002, Romney still claimed he ran Bain. Now he claims he didn't. Either he was lying then or he's lying now. Either way, he's lying.

But the Boston Globe story isn't Romney's only problem today. David Corn, whose reporting for Mother Jones set the stage for the Globe story, breaks another big story: In 1998, Mitt Romney invested millions in a Chinese firm whose business model was to help U.S. companies outsource jobs into China.

On April 17, 1998, Brookside Capital Partners Fund, a Bain Capital affiliate, filed a report with the Securities and Exchange Commission noting that it had acquired 6.13 percent of Hong Kong-based Global-Tech Appliances, which manufactured household appliances in a production facility in the industrial city of Dongguan, China. That August, according to another SEC filing, Brookside upped its interest in Global-Tech to 10.3 percent. Both SEC filings identified Romney as the person in control of this investment: "Mr. W. Mitt Romney is the sole shareholder, sole director, President and Chief Executive Officer of Brookside Inc. and thus is the controlling person of Brookside Inc." Each of these documents was signed by Domenic Ferrante, a managing director of Brookside and Bain.

At the time Romney was acquiring shares in Global-Tech, the firm publicly acknowledged that its strategy was to profit from prominent US companies outsourcing production abroad.

Not only was Romney still at Bain according to his own timeline during this investment, but after making his initial investment, he soon split the holdings between Brookside and Sankaty High Yield Investors'the secretive Bermuda shell company that Romney failed to disclose in his financial disclosure forms but that appears in his 2010 tax returns.

Combined, these two stories represent a serious blow to Romney's credibility. The first one shows he has misrepresented his affiliation with Bain and the second one undercuts his claim that he never invested in any firms focused on outsourcing. These sorts of reports are exactly the reason why Mitt Romney needs to reveal more of his tax returns'and they are exactly the reason why he doesn't want to do it.

8:07 AM PT: Writing at The Boston Phoenix, David Bernstein has a really good take on The Globe's report. Definitely must-read.