Money, Solicitor General's Office

Solicitor General Don Verrilli's Surprising Credit Card Debt

Why does a wealthy former Biglaw partner carry credit card debt at high interest rates?

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Donald B. Verrilli, Jr. (Photo by Mark Wilson/Getty Images)

Your Honors, can you spare a dime? (Photo of Donald B. Verrilli Jr. by Mark Wilson/Getty Images)

Deities of the legal profession: they’re just like us! They carry too much credit card debt, at excessive interest rates.

Back in 2009, we arched an eyebrow at Supreme Court nominee Sonia Sotomayor’s $30,000 in dentist and credit card bills. Conventional wisdom in personal finance frowns upon carrying such big balances, especially given the usually high rates that accompany credit card debt (as opposed to, say, secured debt like a home mortgage).

But it seems that Justice Sotomayor isn’t the only high-flying legal eagle to ignore this advice. A tipster recently drew our attention to the financial disclosure forms of the outgoing Solicitor General, Donald Verrilli Jr. If you look at his 2012 form (page 13) and his 2015 form (page 6), you’ll see five-figure credit card balances at rates ranging from 12 to 23 percent. We share our source’s puzzlement:

How does a former longtime law firm partner consistently carry credit card debt with double-digit interest rates? What sort of basic personal finance lessons did he miss along the way?

Either he’s weirdly broke/illiquid (doesn’t seem to be the case!) or he’s casually indifferent to basic economic sense, which kind of suggests we need higher taxes (which we do)!

My money is on casual indifference. The amounts in question, while in the five figures, are probably too small for Verrilli to care about. On his home mortgage, a much more significant sum (between $500,001 and $1 million), he has a very nice rate of 3.125 percent.

So I wouldn’t be surprised if this consumer debt is just an oversight. If you look at the other pages of his disclosures, you’ll see ample liquid assets that could easily be used to eliminate those pesky credit card balances. Don Verrilli is not a poor man. Back in 2011, when the former Jenner & Block partner was confirmed as SG, his net worth clocked in at more than $4 million.

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The members of the Supreme Court like to “CVSG” — “Call for the View of the Solicitor General” — but they might want to ignore him when it comes to personal finance.

(P.S. One possibility that just occurred to me: could Verrilli be taking advantage of some kind of 0% APR balance transfer offer? If you avail yourself of such an offer and then have to list it in a federal financial disclosure, do you list the interest rate as the 0% introductory rate, or the rate that kicks in after the introductory period ends? If you know the answer to this question, please feel free to email me.)

UPDATE (6/6/2016, 11:10 a.m.): We’ve received some interesting reader mail in response to this story; thanks, readers! Several of the messages raise the possibility that Verrilli isn’t carrying a balance; pays his credit card bills in full each month, perhaps to get points or miles (which is a best practice of personal finance); and just happened to have a high-spending month at the end of the reporting period (maybe because of spending on holiday gifts right before the end of the reporting period on December 31).

This is certainly possible. It’s worth noting, however, that if you read a lot of federal financial disclosures (as we do here at ATL), you rarely see any credit card debt under “Liabilities” — which is why Verrilli’s jumped out at us. For example, take this 2014 report on the Supreme Court justices’ disclosures — the only justice who reported credit card debt was Sotomayor, even though the justices all presumably have credit cards that at any given time of the month have some balance on them.

Here’s the relevant guidance from the Office of Government Ethics on reporting credit card debt, which notes that the following type of debt does not have to be disclosed:

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Revolving charge accounts, such as credit card balances, if the outstanding liability did not exceed $10,000 at the close of the reporting period.

This explains why it’s rare to see credit card on federal financial disclosures. Many officials either (1) pay off all their credit card debt, or at least get it down to below $10,000, right before the end of the relevant reporting period, or (2) don’t have balances exceeding $10,000 in any event (whether they carry these balances or not).

In Don Verrilli’s case, he didn’t bother to get his debt below $10,000 prior to filing his disclosures (or perhaps he or his assistant misread the admittedly complex forms and instructions). So that’s why his credit card debt jumped out at us (and our initial tipster); it’s so unusual to see credit card debt listed on these forms for officials in his type of position.

Earlier: Solicitor General Don Verrilli To Step Down — Perhaps Before All SCOTUS Opinions Are Announced
Does Judge Sotomayor Need A Visit from Suze Orman?
Musical Chairs: Don Verrilli Confirmed As Solicitor General

David Lat is the founder and managing editor of Above the Law and the author of Supreme Ambitions: A Novel. You can connect with David on Twitter (@DavidLat), LinkedIn, and Facebook, and you can reach him by email at dlat@abovethelaw.com.

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