President Barack Obama won’t return campaign donations to executives, advisers and directors who have profited from offshore mergers that reduce corporate taxes using a technique he has called “unpatriotic.”

Responding to a Bloomberg News report that described connections between more than 20 Obama donors and the tax-cutting transactions, White House Deputy Press Secretary Eric Schultz said the president will keep the cash.

“We are not privy to the details and have no role in any individual company’s plans,” Schultz said at a briefing on Martha’s Vineyard where Obama is vacationing. “But what the president is focused on is stopping the problem.”

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He said there isn’t a double standard and that he would “understand the skepticism more if we weren’t doing something to tackle the problem.”

Donors involved with the tax deals include Blair Effron, an investment banker who hosted Obama for a May fundraiser at his two-level, 9,000-square-foot apartment on Manhattan’s Upper East Side. Others are Jim Rogers, co-chairman of the host committee for the 2012 Democratic National Convention; Roger Altman, a former senior Treasury Department official who raised at least $200,000 for Obama’s re-election campaign; and Shantanu Narayen, who sits on the president’s management advisory board.

Presidential Tensions

The administration’s connections to these donors are causing tensions for the president as he urges Congress to act against the deals and prods the Treasury Department for short- term steps to curb them. The president’s tough talk also may become a liability as Democrats seek corporate America’s cash this year as they try to preserve their majority in the U.S. Senate.

“It’s populist rhetoric,” said former U.S. Senator Bob Kerrey, a Nebraska Democrat who advises clients at Carmen Group Inc., a Washington consulting and lobbying firm. “And at some point it’s sufficiently misleading that it draws the attention away from the difficulties involved with an agreement to lower the corporate tax rates — that’s not an easy thing to do.”

It’s to Obama’s credit that he’s willing to criticize his donors, said Robert Weissman, president of Public Citizen, a Washington-based group that describes itself as a “countervailing force” to companies.

Criticizing Deals

“Campaign finance primarily comes from a very narrow band of very rich people,” he said. “It’s less of a problem of presidential hypocrisy than it is a problem of the state of the campaign-spending and campaign-donor world.”

Obama started criticizing the deals known as corporate inversions in July, after Medtronic Inc. and AbbVie Inc. announced the two largest such deals in U.S. history. Administration officials had started to worry that a wave of companies could follow the economic incentive.

In inversions, U.S.-based companies merge with a smaller foreign business and take a non-U.S. address for tax purposes, typically without moving their operations or executives. The deals, which are legal, let companies deploy cash overseas without paying U.S. taxes and make it is easier for them to reduce U.S. taxes on income earned in the country.

Obama said the deals are a “threat” to the U.S. and approvingly quoted others who called the companies involved “corporate deserters,” using the kind of language one doesn’t usually employ to describe supporters.

‘Stashing Offshore’

“It sticks you with the tab to make up for what they’re stashing offshore through their evasive tax policies,” Obama said in Los Angeles on July 24. The president also said the deals involve just a few big corporations and that the “vast majority of American businesses play by the rules.”

A Bloomberg News review of publicly available information identified the executives, directors and advisers involved in the recent wave of transactions. The tally doesn’t include the contributors at senior levels of such companies as Goldman Sachs Group Inc. and JPMorgan Chase & Co. that have advised companies on the mergers.

Effron is co-founder of Centerview Partners LLC, a New York investment firm. Centerview advised Abbott Laboratories, which is selling some of its non-U.S. businesses to Mylan Inc. in a deal that will let Mylan put its tax home in the Netherlands.

Pfizer Rejected

Centerview also advised AstraZeneca Plc as the London-based company rejected multiple offers from Pfizer Inc. that would have led Pfizer to take a U.K. address.

Effron was among Obama’s top campaign-donation bundlers, raising more than $500,000 and attending a 2011 state dinner — complete with Texas Wagyu beef and a performance by singer Janelle Monae — in honor of Lee Myung-bak, then-president of South Korea.

Most recently, on May 14, Effron opened up what Obama called a “gorgeous home” for an event that yielded up to $32,400 per person for Senate Democrats.

The “whole crew” organizing the event, Obama said, were “early investors and they’ve been with me through thick and thin.”

Effron declined to comment.

Republicans need a net gain of six seats to take control of the 100-member Senate. Analysts rate Democrats the underdogs in maintaining three seats they hold — in Montana, South Dakota and West Virginia — and the party is defending several others rated as tossups.

Forgiving Loan

Rogers helped finance the 2012 convention in Charlotte, North Carolina, as chairman and chief executive officer of Duke Energy Corp. He spoke at the convention the same day that Obama accepted the party’s nomination, where he called for investments in nuclear, wind and solar energy.

Under Rogers’ leadership, the utility company with its headquarters seven blocks from the convention site forgave a $10 million loan it made for the event, claiming it as a business expense.

The president and first lady Michelle Obama recognized Rogers at events in 2012, and he attended a 2011 state dinner in honor of German Chancellor Angela Merkel at which James Taylor performed.

Rogers is a director of Applied Materials Inc., which has a pending inversion transaction with Tokyo Electron Ltd. that will place the combined company in the Netherlands.

Rogers, who was replaced as Duke’s CEO in 2013, didn’t respond to a phone call or an e-mail seeking comment.

‘Understandable’ Considerations

Altman is the founder and executive chairman of Evercore Partners, a New York investment firm that advised Shire Plc, which has a pending inversion deal with AbbVie.

Altman was deputy Treasury secretary in President Bill Clinton’s administration and was a bundler for Obama. He said on July 31 that it was “understandable” why companies were considering inversions.

“It’s a shame that the differential between U.S. corporate tax rates and comparable global partner tax rates is so wide that a lot of corporations feel impelled to redomicile,” he said on Bloomberg Television.

Asked whether he supports Obama’s proposals, Altman said, “We just need to get on with tax reform.” Through a spokesman, he declined to comment for this story.

Narayen is the chief executive officer of Adobe Systems Inc. and a director of Pfizer, which earlier this year proposed the largest inversion in history.

Democratic Donor

In 2012, he gave $30,800 to the Democratic National Committee, $2,500 to Obama and more than $6,000 to other Democratic committees and candidates, according to data compiled by the Center for Responsive Politics, a Washington group that tracks money in politics. He attended Obama’s first state dinner in 2009, for Manmohan Singh, then-prime minister of India.

Narayen came to a 2010 White House forum on modernizing government and joined Obama’s management advisory board. Through a spokeswoman, he declined to comment for this story.

Many of the executives involved in inversions donate frequently to Republicans, including Alexander Cutler, the CEO of Eaton Corp., Miles White, the CEO of Abbott, and Ian Read, the CEO of Pfizer.

Obama is backing legislation proposed in Congress to make it more difficult to complete the deals.

The measure hasn’t advanced. Republicans are opposed and crucial Democrats on the Senate Finance Committee, including Mark Warner of Virginia and Bob Casey of Pennsylvania, haven’t endorsed the legislation.

Seeking Action

In part because of that deadlock, Obama said on Aug. 6 that he wants the Treasury Department to act “as quickly as possible” on rules that would make inversions less attractive.

Though the president’s attention to inversions is recent, the direction of his policy isn’t a surprise. He campaigned twice on ending tax breaks that he says ship jobs overseas.

The administration included an anti-inversions proposal in its budget for the first time this year. In 2009, by contrast, as part of its bailout of the auto industry, the Treasury Department helped the Michigan parts supplier Delphi Corp. emerge from bankruptcy as a U.K. company.

The Internal Revenue Service is now challenging Delphi’s claim to be a U.K. company for tax purposes.

The most visible Democratic executive engaged in an inversion deal is Heather Bresch, the CEO of Mylan and daughter of Senator Joe Manchin, a West Virginia Democrat. Bresch gave $1,000 to Obama in 2008, plus $10,000 to the West Virginia state Democratic Party in 2010.

Pfizer Executive

One of Obama’s biggest bundlers, Sally Susman, is an executive vice president at Pfizer who gave more than $89,000 to Democrats in 2011 and 2012 combined.

Robert Pozen, a director of Minneapolis-based Medtronic who teaches at Harvard Business School, donated to Obama in 2008 and regularly gives to Democrats, including Senators Al Franken of Minnesota and Elizabeth Warren of Massachusetts. In an e-mail, Pozen declined to comment.

In the Wall Street Journal earlier this year, he wrote that the U.S. tax code gives companies a “perverse incentive” to move operations and workers out of the country. Pozen called for a 17 percent “global competitiveness tax” on U.S. companies’ foreign profits.

Then there’s Glenn Tilton. The former CEO of UAL Corp. and JPMorgan executive is a director of both AbbVie and Abbott. Tilton, who declined to comment, donated to politicians in both parties — including $5,000 to Obama’s opponent, Mitt Romney, in the 2012 presidential race.

He received an administration post that now looks awkward for a president concerned about shipping the tax base out of the U.S. — a spot on Obama’s Export Council.

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