Petro: Noe Took Nearly $6M Improperly

COLUMBUS (AP) -- Attorney General Jim Petro on Thursday accused a rare coin dealer at the center of an investment scandal of stealing about $6 million from the state for personal use. Financial documents from Toledo-area coin dealer Tom Noe show he improperly used $4 million of the money he received from the state insurance fund for injured workers to pay himself and his coin collection business, Petro said.

About $1 million of that money from the Bureau of Workers' Compensation was deposited in a bank account and used to pay off a loan for his business, Petro said. Noe "pilfered millions intended for Ohio's injured workers," Petro said.

Questions about the state's investment in rare coins have ballooned into an ongoing scandal involving $300 million in investment losses, state and federal investigations into state financial policies and possible ethics violations by Gov. Bob Taft involving golf outings he failed to disclose.

Petro, a Republican running for governor next year, also is questioning the source of an additional $2 million in assets that Noe liquidated, including homes, boats and cars he has sold in recent weeks. "We're asserting those assets were purchased with stolen money," Petro said.

An order issued by Franklin County Common Pleas Court Judge David Cain in May froze all personal and business assets of Noe and his wife. Petro on Wednesday asked Cain to enforce that order, alleging that in one instance last month Noe violated the agreement by selling a 2004 Jeep Liberty worth $18,285 to his sister-in-law. He cited documents gathered about the sale and an investigation by the Lucas County Prosecutor's Office.

Under the May agreement, Noe must get court approval for selling items above $15,000; Petro wants that reduced to $5,000.

Noe's attorney Jud Scheaf said Petro is raising old allegations about Noe's use of state dollars and says Noe is cooperating with authorities. "There's no need to do anything different than what the court has already ordered him to do and he's agreed to do," Scheaf said. "He's been abiding by the order that's in place."

Citing 120 boxes of documents gathered by investigators, Petro said that from March 1998 through May 2005, Noe took $2.164 million from state investment dollars and reported them as profit. Then, Noe's attorney on May 26 said for the first time that $10 million to $12 million of state funds invested in rare coins were missing, Petro said. "With this confession, it is becoming clear that these Coin Funds had never been profitable and that by paying himself a 'profit', Mr. Noe was converting BWC funds to his personal use," Petro argued Thursday in a court document prepared by William Becker, an assistant attorney general.

Also Thursday, Petro spokeswoman Kim Norris said agency lawyers were conferring with the state Inspector General about a lawsuit filed by Gov. Bob Taft's former top lieutenant trying to bar the release of records. Brian Hicks, now a Columbus political consultant, sued Inspector General Tom Charles on Tuesday in Franklin County Common Pleas Court.

Hicks is fighting Charles' request that he release information about gifts he may have received as Taft's chief of staff. Hicks' attorney, John Zeiger, called the request "a quintessential fishing expedition."

In addition, a workers' compensation spokesman said Thursday an investment account managed by Fifth Third Bank has lost almost $11 million since 2001. The losses, first reported by The Cincinnati Enquirer on Thursday, were due to the fund's underperformance, said BWC spokesman Jeremy Jackson. The account is being reviewed, he said.

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Posted by AEB

Sources: Attorney General's Office, The Associated Press