(Bloomberg) -- The Bloomberg Billionaires Index lowered its net worth calculation for U.S. Commerce Secretary Wilbur Ross to $860 million from $3 billion after determining that figures he provided couldn’t be independently verified.
The revaluation follows a Forbes report last week that concluded Ross inflated the size of his fortune to the media for years. Bloomberg’s previous calculation included historical compensation figures submitted by Ross in an on-the-record email exchange in 2016, before he joined President Donald Trump’s cabinet. Those figures have now been removed.
Ross declined to comment through Commerce Department spokesman James Rockas.
The revised wealth calculation:
- Reduces his participation in profits of three WLR Recovery funds to an average of 51 percent from 100 percent, and to 15 percent for some of his later funds, based on new information provided by two former insiders at the investment company.
- Asserts Ross has earned about $500 million in total profits from the funds, based on Bloomberg data on their size and performance, and a description of their fee structure in a December financial disclosure to the Office of Government Ethics.
- Includes $265.5 million that Ross was to receive over six years after selling W.L. Ross & Co. to Amvescap Plc’s private capital division in a 2006 deal, according to Amvescap’s SEC filings.
- Assumes $40 million in compensation for his more-than-three-decade investing career before W.L. Ross, based on a 1990 New York Times story, as well as an April 2000 lawsuit from his ex-wife. That period included stints as a president of brokerage Faulkner, Dawkins & Sullivan, and as an executive at wealth management firm Rothschild Inc.
- Applies the highest federal and New York State income taxes to his earnings and an average annual appreciation of 4.5 percent.
- Values his art collection -- featuring works by Belgian surrealist Rene Magritte –- at $125 million based on information published in a December 2014 Haute Living article, Bloomberg News reports and recent auction prices. The original valuation of $250 million included a figure provided by Ross.
- Includes real estate assets valued at $43 million.
Asset valuations that Ross listed in his December financial disclosure aren’t used in the analysis. Filers are required to value some holdings within ranges and others with a minimum value. Ross reported assets with a minimum value of about $320 million. But using figures at the high end, they are worth about $660 million -- or more -- including his art collection and three cash accounts each holding at least $50 million.
“You really don’t get a real picture of what the finances are like,” said Larry Noble, a senior director at the Campaign Legal Center, a non-partisan election-law center in Washington. “You can’t figure out the top end. There’s a real public interest in knowing the financial interest that these people have.”
The Forbes story concluded that Ross was lying after he told a reporter who asked about the amounts that $2 billion of assets were transferred into family trusts that didn’t need to be disclosed. A Commerce Department spokesman told Forbes there was “no major asset transfer to a trust” between Trump’s election in November 2016 and Ross’s financial disclosure the following month.
On Monday, six Democratic senators cited that discrepancy in a letter to the agency’s inspector general, seeking an investigation to clarify the value of Ross’s personal wealth and to ensure he’s meeting divestment and recusal requirements.
“Secretary Ross’s disclosure documents were compiled by legal counsel and accountants,” the department’s main public affairs office wrote in an unsigned email to Bloomberg last week. “The relevant rules were followed, and the documents were closely reviewed and approved by ethics officials at the Department of Commerce and the Office of Government Ethics. We regret any earlier miscommunication.”
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