A snarky ad juxtaposes an off-key Mitt Romney leading a crowd singing America the Beautiful with claims on the screen saying the Republican candidate has parked millions of his personal fortune far from U.S. shores.



"He had millions in a Swiss bank account," the ad says, and in "tax havens like Bermuda … and the Cayman Islands."



It ends with: "Mitt Romney’s not the solution."



We rated the Swiss bank account claim True. Here we’ll dig into the Cayman Islands charge.



Romney has released his tax return for 2010 and an estimate for 2011 indicating that his income was $21.7 million in 2010 and $20.9 million last year. His financial disclosure, which is required of all presidential candidates, shows that Romney’s personal wealth is somewhere between $85 million and $264 million, according to the Washington Post.



News organizations have analyzed how Romney has invested his money, gleaned the greatest tax benefits and maximized profits at Bain Capital, the private equity firm he founded.



The Cayman Islands is mentioned in several of the reports:



* Romney utilized shell companies in the Cayman Islands and Bermuda to attract foreign investors to Bain, according to 2007 documents analyzed by the Los Angeles Times.



The Times identified one such fund as BCIP Associates III Cayman. It’s listed on Romney’s 2007 financial disclosure as having paid him more than $1 million the previous year in dividends, interest and capital gains.



* Early in 2012, ABC News reported that Romney "has as much as $8 million invested in at least 12 funds listed on a Cayman Islands registry. Another investment, which Romney reports as being worth between $5 million and $25 million, shows up on securities records as having been domiciled in the Caymans."



That fund, called BCIP Trust Associates III, is part of his individual retirement account and provided between $1,000,000 and $5,000,000 in income, the disclosure shows.



David S. Miller, a tax attorney with Cadwalader, Wickersham & Taft LLP in New York, told PolitiFact that tax-exempt entities, including IRA accounts, sometimes invest through Cayman Islands corporations to reduce their U.S. taxes. "Congress did not deliberately allow tax-exempts to reduce their U.S. taxes by investing through Cayman Islands corporations," Miller said. "However, the practice is widespread and the IRS has approved of it."



Miller agreed that it’s accurate to call the Cayman Islands a tax haven.



"That phrase usually refers to whether the jurisdiction imposes taxes and the Cayman Islands doesn’t," he said.



Other, more nuanced advantages exist for high net-worth individuals who put their money in foreign corporations. For example, a high net-worth individual can’t deduct the management fee paid to a fund manager, but a foreign corporation can.



"There are other advantages for U.S. taxpayers who invest through foreign corporations. They’re relatively subtle, but the advantages increase as the tax rates increase," Miller said.



Finally, in a transcript of a conference call hosted by the Romney campaign in January 2012, the trustee for the Romney family’s financial investments -- Brad Malt of the law firm Ropes & Gray -- acknowledged the existence of the Cayman investments.



"These are investments in third-party entities," Malt said, likening them to stock in Toyota.



He continued: "Each of these investments is in a blind trust. … This means the decision to make the investment was made by me, not by Gov. Romney. … I should say I, in turn, have no control over where these funds are formed. … When we make an investment in a Cayman fund, we're presented with investment documents, the sponsor has already chosen where the fund is to be organized, and to be perfectly clear, the blind trusts are a tiny part of the investor base of these funds."



He went on to emphasize that each of the Cayman funds files a U.S. tax return, which reports the blind trust's share of the fund income. "Every dime of that, in turn, is reported on Gov. Romney's tax returns," Malt said.



When we asked the Romney campaign for a response to the Obama ad, a spokesman emphasized these same points -- that Romney has paid all taxes he owed, that investment decisions were made by the trustee and the trustee does not decide where the funds are "domiciled."



Our ruling



Obama’s ad says Romney had millions of dollars in the tax-friendly Cayman Islands.



Romney’s trustee acknowledged investing Romney’s money in funds located there, and several are listed on his financial disclosures. Those forms indicate the value of those investments is in the millions.



There's no evidence of anything illegal or improper, but it's clear that Romney had millions in the Caymans. We rate the claim from the Obama ad True.