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This is MORNING EDITION, from NPR News. I'm Renee Montagne.

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And I'm Steve Inskeep. Good morning. Let's look a little more closely at one of the questions about Mitt Romney's overseas investments. Some of those questions this week arose from a report in the latest issue of Vanity Fair. It describes how the day before Romney was sworn in as governor of Massachusetts a decade ago, he put a corporation he'd set up in Bermuda in a blind trust held by his wife, Ann. Romney insists he did nothing wrong. NPR's David Welna has been trying to find out what that investment was all about. Here's his report.

DAVID WELNA, BYLINE: Sankaty is a cape on Nantucket Island, known for its lighthouse. Six-hundred miles to the south. Sankaty is also the name of an offshore investment account Mitt Romney established in Bermuda 15 years ago. Romney first revealed his ties to this offshore entity in the 2010 tax return he released in January. Earlier this week, on Fox News Radio, he defended his actions.

MITT ROMNEY: I have followed the law. I have paid my taxes as due. I have also disclosed, through all of the requirements of the government, every asset which I own, fairly and honestly.

WELNA: So what was the advantage of setting up Sankaty High Yield Assets Investors Limited, hundreds of miles off the North Carolina coast? The American lawyer who set up Romney's corporation in Bermuda declined to comment for this report. So did Romney's longtime associate, Brad Malt, who administers the trust where it's now held. But there was another option.

UNIDENTIFIED WOMAN: Ladies and gentlemen, welcome to beautiful Bermuda. Local time is 2:45.

WELNA: Bermuda may be tiny, but it's got loads of lore. Two centuries ago, the British hatched plans here for the War of 1812. These days, Bermuda attracts cruise ships as well as foreign money.

UNIDENTIFIED MAN: (Singing) Lean on me when you're not strong...

WELNA: At the Bermuda Bistro at the Beach, policeman Andy Morgan steps away from a sing-along to talk about Mitt Romney's investment.

ANDY MORGAN: If he's registered here, he's registered here for a reason; maybe to the benefit of the shareholders of that company.

WELNA: It turns out, for a $20 fee, you can check out the documents that established Romney's own corporation, at Bermuda's Registrar of Companies.

UNIDENTIFIED WORKER: And that is the file on the company.

WELNA: OK.

The folder I'm handed at the registrar is slim, just 10 pages. Romney's name does not appear anywhere on these pages. The entity he created in October 1997 is described as a holding company, initially authorized to have 12,000 shares worth a dollar each.

Within three years, seven other Sankaty investment funds were also established in Bermuda. U.S. records show at least $25 million worth of stock, most of it for Domino's Pizza, was sold from Romney's holding company while he was governor of Massachusetts. Here in Bermuda, government officials seem extremely reluctant to discuss Romney's investment. Nea Talbot is with the Department of Communication and Information.

NEA TALBOT: Bermuda doesn't want to get too drawn into - we don't want to get drawn in it at all.

WELNA: Nor does the law firm that's the Bermuda address for Romney's holding company. It's located in a gleaming, five-story building known as Thistle House, in the heart of Hamilton, Bermuda's bustling capital.

In the marble-floored lobby of this building that appears to be home, in name only, to Romney's Bermuda account, corporate finance lawyer Steven Rees Davis is getting a coffee. He won't say which firm he works for, but he's annoyed that Romney's business in Bermuda is now making waves.

STEVEN REES DAVIS: It's the American politicians that make it out to their public that, you know, anybody who does business with Bermuda is like a dirty old man dealing with pirates.

WELNA: As Rees Davis notes, U.S. law actually lets Americans lower their tax bills by parking investments in Bermuda, which has no income tax.

REES DAVIS: Why would you operate in a certain manner, and pay a certain amount of tax; when legally, you could just change that, do something differently, and pay less tax? So why would you buy bottles of Goslings Rum duty-free when you leave the country, when you could go buy it at Front Street and pay full duty for it? Why do we do that? Well, because we get it duty-free. Everybody does it.

WELNA: Experts say Romney appears to have set up a retirement account in Bermuda, with hedge fund-type investments that would otherwise be taxed in the U.S. James Hines is an international tax expert at the University of Michigan.

JAMES HINES: We don't have full knowledge of Gov. Romney's tax situation, so we can't say for sure. But yeah, it looks like a way of - you can call it tax avoidance; you can call it facilitating investments that otherwise, wouldn't be profitable.

WELNA: If you had enough money to buy a company, Hines says, you could do it, too.

David Welna, NPR News, Hamilton, Bermuda.

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