Update: Tiffany says Newt Gingrich has paid off his 12-month, no-interest charge account
Updated 7:00 p.m.
“With the permission of Speaker Gingrich, we can confirm that his Tiffany Time Account has a zero balance and that all payments were made in a timely manner.”
— Carson Glover, director of worldwide media relations at Tiffany & Co.
We have an update and new information to share on former House speaker Newt Gingrich (R-Ga.)’s purchases at Tiffany & Co. (Apologies in advance to readers who believe the Fact Checker is dealing with trivia in exploring this issue in such depth.)
Glover, a Tiffany spokesman, provided us Tuesday afternoon with the following statement, which we will quote in full.
Tiffany & Co. offers two forms of credit. The first is a Tiffany revolving credit card agreement with state-specific interest rates.
The second is a Tiffany Time Account. To meet competitive conditions, Tiffany makes Time Accounts available to revolving credit card customers who wish to purchase engagement rings over $1,000 or other merchandise valued over $5,000. On a transactional basis, this program offers interest-free borrowing for up to one year for credit-worthy Tiffany customers.
All customer information is confidentially held at Tiffany & Co. With the permission of Speaker Gingrich, we can confirm that his Tiffany Time Account has a zero balance and that all payments were made in a timely manner.
Let’s now deconstruct that and explain what it means. The Gingrich campaign will not comment, so there are several ways to interpret this — none of which suggest that Gingrich is as “frugal” as he claims.
First of all, several readers wrote us to say that they had purchased an engagement ring on a 12-month, no-interest plan. (We had overlooked a clause in the current Tiffany credit agreement that allows for no interest charges for some items at the point of sale.) That is clearly an option, but it did not really explain the fact that Callista Gingrich filed two years of consecutive reports — in 2005 and 2006 — showing she and Gingrich owed $250,001 to $500,000 to the jewelry company.
The financial disclosure forms list the Tiffany liability as a “revolving charge account,” not a “charge account.” (Gingrich’s American Express account is listed on the form as a “charge account.”) The Gingriches clearly had a revolving credit card with Tiffany, or else they would not have qualified for the Tiffany Time Account. (A revolving account is one in which the customer can carry a balance.)
The disclosure forms required Gingrich’s wife to report the balance of revolving charge accounts that exceeded $10,000 at the close of the calendar year. That suggests that the Tiffany balance was paid in full one year — i.e., within 12 months — but then Gingrich and his wife ran up another $250,000 to $500,000 the next year. Only two years of reports were filed.
Glover would not elaborate on the Tiffany statement, but it is worded to suggest that all of the Gingrich purchases were made on the Tiffany Time Account, even though they also had a Tiffany credit card. But we do not know that for sure. The phrase “timely manner” still could mean that they paid interest on their Tiffany card. The statement also does not address whether he has debts on his credit card.
We further do not understand why the Gingriches would pay off these charges over 12 months if they had the means to pay them off in full. In an interview Sunday with CBS’s “Face the Nation,” Gingrich said “it was paid off automatically” and he had “no idea” how long he owed it.
(Incidentally, though it may seem like a good deal that no interest is charged for 12 months, rest assured that Tiffany’s has already priced hidden interest into the original purchase price. Nothing in life is free.)
Gingrich, in a meeting with reporters on Monday, suggested puzzlement about what he and his wife spent at Tiffany’s. He suggested they were gifts for friends and family. That’s a lot of bling at Christmas! (Time magazine has identified seven apparent Tiffany pieces worn by Callista that would cost about $85,000.)
Of course, Tiffany’s does offer free cleaning of jewelry and even an upgrade program for diamond rings. Maybe that’s what Gingrich means when he claims he is frugal?
The Pinocchio Test
Tiffany has acknowledged that Gingrich was given a no-interest account, and that he now owes no money for his purchases. But the story still does not add up.
Were each of these purchases put on a 12-month extended payment plan, over and over again? Tiffany suggests this is generally done for certain purchases, such as a ring, so it still does not seem like the normal way of doing business.
Moreover, if Gingrich and his wife really ran up bills at Tiffany every year totaling more than $250,000, that completely undercuts his claims of being “frugal.” For that reason alone, our Three Pinocchio ruling stands.