According to Lee Fang of ThinkProgress, Romney, Tagg Romney and Spencer Zwick, a fundraiser for the Romney campaign, partnered with executives from Stanford Financial Group to create a new subsidiary "wealth management business."
Tagg Romney and Zwick launched Solamere Capital in 2008, with Mitt Romeny making an initial investment of $10 million. Stanford Financial, the firm headed by Sir Alan Stanford, collapsed in 2009, and Stanford himself was charged by the SEC in 2009. In the same year, Tagg partnered with Tim Bambauer, Deems May, and Brandon Phillips, formerly of Stanford Financial, to form Solamere Advisors, a wealth management firm.
"They probably made, their pay there was like $15,000 total. Those guys got totally screwed by the whole thing," Tagg Romney told ThinkProgress. "It almost ended their whole careers because they moved all their clients over [to the Stanford Financial Group], and then the place was shut down two months after they moved their clients over. They hadn't made any money yet. They had bonuses and everything promised to them, but they didn't make any of their money. So they made no money."
He also claimed that they had been cleared of wrongdoing related to the scheme, but, according to ThinkProgress, the charges have not been dropped. And:
Moreover, a court-appointed audit of the Stanford Financial Group found that several of the former Stanford brokers made far more than what Tagg claimed:
- Solamere Advisors managing partner Tim Bambauer made $1,143,392 in incentive pay selling fraudulent CDs to investors.
- Solamere Advisors partner Deems May made $465,000 in incentive pay selling fraudulent CDs to investors.
- Solamere Advisors operations manager made Brandon Phillips $70,000 in incentive pay selling fraudulent CDs to investors.
Read the full report here.