toledoblade.com -- Noe transferred $3.18M to his own firm

COLUMBUS — A seemingly endless stream of cash flowed into Tom Noe’s personal business, Vintage Coins and Collectibles, from Ohio’s $50 million rare-coin ventures that the former Toledo-area coin dealer managed, documents show.

During the last 18 months of the failed venture, Mr. Noe authorized at least $3.18 million in checks to Vintage Coins from the coin funds, a Blade review of 15,000 pages of transaction records show.

A spokesman for Attorney General Jim Petro’s office confirmed yesterday that the checks are being examined as part of the investigation into the coin funds.

On Thursday, Mr. Petro charged that Mr. Noe stole nearly $4 million from Ohio beginning on the same day the Toledo-area coin dealer received his first installment of $25 million from the state in 1998.

Yesterday morning, an attorney for Mr. Noe’s wife, Bernadette, said Mrs. Noe — a former chairman of the Lucas County Republican Party — is “surprised and stunned” by the developments, which have “strained” their marriage.

However, later in the day, the Noes were spotted together by Blade reporters in Columbus with their lawyer.

They refused to comment on Mr. Petro’s charges.

Also yesterday, Gov. Bob Taft, who initially defended Mr. Noe — one of his most steadfast campaign contributors — said during an appearance in Cincinnati that Mr. Noe was “obviously not what he appeared to be.”

The Democratic National Committee responded to this week’s news by repeating its calls on President Bush to return the more than $100,000 that Mr. Noe raised for his re-election campaign.

DNC Chairman Howard Dean said in a statement: “We are learning more every week about the extent to which the Republican Party’s culture of corruption has polluted the Republican-dominated government in Ohio.”

Dozens of checks

Dozens of checks were written from the accounts of Capital Coin to Vintage Coins during the past 18 months, ranging from just a few thousand dollars to $600,000.

From Jan. 1 through May alone, Mr. Noe authorized more than $1 million in checks to Vintage Coins.

The Blade, so far, has received three boxes of transaction records from the state’s coin funds, but the attorney general has said there are up to 120 boxes packed with records of the venture.

Most of the checks contain no explanation for the transfer of funds.
The totals are typically rounded numbers and some were unsigned in the records obtained by The Blade.

A spokesman for National City Bank of Toledo — the bank named on many of the checks — was unable to confirm whether the checks written to Vintage Coin were eventually signed or whether the bank has been contacted by statewide investigations into Mr. Noe.

“At this time, we cannot disclose specific information about our customers and their accounts because this information is confidential and we respect their privacy,” said Tom Tennant, a spokesman for the bank.

Mark Anthony, a spokesman for the attorney general’s office said, “We’re looking at all these documents to determine what to add to our case.”

Additionally, there were a number of noteworthy transactions from coin fund accounts:

*On March 29, 2005, a Capital Coin partner, Rare Coin Alliance, issued a check for $75,000 to Capital Coin Fund II. That same day, Capital Coin Fund II issued a check for the same amount back to Rare Coin Alliance.

*On March 2, 2005, Spectrum Numismatics International Inc., in Irvine, Calif., issued a check for $33,976 to “Tom Noe.” However, National City Bank records show that the same amount was deposited in Capital Coin Fund II accounts one day later.

*On March 24, 2002, Numismatic Professional Ltd., a state coin fund subsidiary in Evergreen, Colo., issued a check for $119,150 to “Vintage or CCF II.” In effect, the check was written to both Mr. Noe’s personal account and to the state’s Capital Coin Fund II.

There is also a number of checks written from Vintage Coins to the coin fund and its various subsidiaries.

One check from Vintage Coins, written on April 22, 2005, was directed to Capital Coin Fund II for $6,515.

On May 6, 2005, Vintage Coins wrote a check for $9,875 to Capital Coin Fund II. There was no explanation for why either check was written.

“Our lawyers are looking at the same documents but for a slightly different purpose,” Mr. Anthony said. “I’m reticent about making any analysis.”

Strain on the marriage

An attorney for Mrs. Noe said yesterday the new allegations have “put a strain on the [Noes’] marriage” and that Mrs. Noe is “surprised and stunned by what she is discovering.”

“She never had suspicions that her husband was engaged in this kind of behavior,” said Buswell “Buzz” Roberts, who is representing Mrs. Noe in her civil matters.

“Any spouse in this situation would be very surprised and disappointed,” he said.

Although her attorney yesterday said their marriage was strained, the Noes were together when spotted by a Blade reporter last night in a downtown Columbus parking garage with one of their attorneys, Douglas Grover.

The Noes got into the same garage elevator with the reporter.

After exiting the elevator, Mr. Grover said he would not comment on Mr. Petro’s allegations about his clients. When the reporter turned to interview the Noes, they had disappeared.

The reporter found the Noes hiding in a garage stairwell.

When asked to respond to Mr. Petro’s allegation, Mr. Noe said, “Didn’t you talk to my attorney?”

When asked again for a reaction in his own words, Mr. Noe repeatedly replied, “No. Thank you,” each time more firmly than the time before.

Mrs. Noe also declined to comment and walked away.

The Noes were meeting with their attorney, who is with the firm Thompson Hine LLP, which has an office in the One Columbus building, adjacent to the Leveque Tower where The Blade has its Columbus bureau.

While the first Blade reporter was attempting to interview the Noes, a second Blade reporter went to the garage exit gate.

Mr. Noe left the garage driving a black Cadillac, after paying the $12 parking fee.

He again refused to comment, telling the garage attendant to call security.

The lawyer sat in the passenger seat and Bernadette Noe, a coat draped over her head, sat in the back of the car.

Judge David Cain of the Franklin County Common Pleas Court has set a 9 a.m. hearing on Monday to hear new complaints by Mr. Petro in the Noe case.

Mr. Petro said yesterday he would ask the court to order the Noes to ask for approval before selling any assets above $5,000 in light of the accusations that Mr. Noe stole from the state.

Mr. Roberts said yesterday Mrs. Noe “has had nothing do with any of things [Mr. Noe] has been accused of.

“The state is not backing down from its position that she may have been a recipient of funds improperly taken by her husband,” he said. “We dispute these allegations.”

Mr. Roberts said there has been no change in the couple’s marital status, but Mrs. Noe is living in Florida, where she is attempting to find work.

Mrs. Noe, an attorney, has applied for positions with law firms in Florida, Mr. Roberts said.

Meanwhile, “She’s trying to keep her family together. It’s hard for her entire family — it’s been hard for her father.”

Mrs. Noe’s father is Francis “Buddy” Restivo, a retired Lucas County Common Pleas Court judge and former Toledo Municipal Court jurist.

Taft speaks in Cincinnati

Gov. Bob Taft was in Cincinnati yesterday on a bus tour across the state with U.S. Health and Human Services Secretary Mike Leavitt to hold town hall-style meetings about a new Medicare prescription drug program. The drug program begins next year.

He spoke with a group of reporters about the rare-coin scandal after the meeting.

“Mr. Noe was obviously not what he appeared to be. ... He misled many, many people,” he said. “I think everybody was misled. The Bureau [of Workers Compensation] was misled, the state was misled, the people of Ohio were misled, I was misled, many people were misled, about the nature of Tom Noe.”

Mr. Taft also responded to questions about how Mr. Noe began contributing to his campaign only a week after he transferred $1.375 million from the state rare-coin fund to his own accounts after receiving his first $25 million from the bureau in 1998.

“We’re reserving all the dollars contributed by Tom Noe and setting that aside until we can find out the source of those monies, so we can reimburse the proper party, whether it’s the state or whomever it may be,” he said. “We’re prepared to repay that to the proper authority once we understand what’s happened here. We still have a lot to understand. The criminal investigation is still under way.”

Mr. Noe is facing state and federal investigations, including a probe into whether he laundered money into President Bush’s re-election campaign.

The President’s political advisers have said the $4,000 contributed directly by Mr. Noe would be returned, but the rest of the money he raised for the campaign would not be returned for now.

DNC Chairman Howard Dean accused Mr. Noe of using “public money to buy influence at the highest levels of the Republican Party, including President Bush’s re-election campaign. President Bush should follow the lead of Ohio Republicans who have returned Tom Noe’s tainted cash.”

A spokesman for the Republican National Committee could not be reached yesterday.

Accountability?

Mr. Noe never answered to the bureau or an accountant for the checks he cut from the state coin fund to his own separate businesses.

The bureau stipulates that its investment managers submit an audited financial statement each year.

All of the investment’s transfers, transactions, holdings, and returns are supposed to be independently verified by the audit.

Accounting firms Plante & Moran and Doyle & McDonnell collected thousands of dollars from the fund but only inventoried documents and assets made available by Mr. Noe.

“Plante & Moran did not do an audit,” Attorney General Jim Petro said Thursday. “Plante & Moran did a review. A review provides no assurance.”

The firm’s June, 2004, review excluded $7 million worth of coins because those assets were “not on-site.”

The inventories contained hundreds of pages that listed coins, their grades, values, and serial numbers.

They neglected to include other alleged fund investments such as loans, mortgages, and collectibles ranging from presidential Christmas cards to paintings.

Executives with Plante & Moran and Doyle & McDonnell were unavailable for comment.

With the coin funds denounced by the attorney general as a Ponzi scheme, the bureau plans to evaluate its audit processes as part of its larger overhaul of investment procedures.

“That is currently under review,” spokesman Jeremy Jackson said. “Obviously, with a somewhat fractured infrastructure and issues with accountability and controls, this falls under Ennis Knupp’s broad review of our investment operations.”

As part of its investigation, the State Auditor Betty Montgomery said she is performing the thorough examination that the coin funds never received during their seven-year existence.

Mr. Petro served as auditor until 2002.

Jen Detwiler, a spokesman for Ms. Montgomery, said the bureau’s investments are regularly audited by an outside firm, KPMG. The reviews are based on “a strict set of nationally accepted auditing standards.” Ms. Montgomery was not available to speak with The Blade yesterday, Ms. Detwiler said.

Ms. Detwiler said KPMG uses a sampling process to detect problems with investments.

“In the case of BWC, it does not appear there is an indication there was a concern about the coin fund,” Ms. Detwiler said. “That being said, in light of what we know now, we are going back as part of our special audit and we are doing a transaction-by-transaction audit of the coin fund.”

Ms. Detwiler said it is not clear why the audit did not detect problems with the bureau’s coin fund.

“Once all the facts have come to light and we are in a position to understand exactly what transpired, we will be in a position to make that type of assessment,” she said. “This is an ongoing matter. We are not going to draw a conclusion before we have the facts.”

Staff writers Christopher D. Kirkpatrick and Jim Provance contributed to this report.

Contact Steve Eder at:
seder@theblade.com
or 614-221-0496.

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