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Published: Thursday, 2/23/2006

Montgomery, Petro defend actions in Noe probe

BY STEVE EDER
BLADE STAFF WRITER
State Sen. Tim Grendell State Sen. Tim Grendell
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COLUMBUS - As State Auditor Betty Montgomery released a 300-page audit detailing the alleged crimes of Tom Noe, she noted that "what is startling, if not shocking, is the lack of oversight in the investment" with the rare-coin dealer and GOP contributor.

The audit offered a scathing report on Mr. Noe's handling of the state's $50 million rare-coin fund, alleging he owes the state $13.5 million. But politically, the findings focused back on Ms. Montgomery, who called for the audit amid scandal 10 months earlier.

Yesterday, political opponents - both Republican and Democrat - said they could not understand why Ms. Montgomery, a GOP candidate for attorney general, was so surprised by the breakdown considering her prominent oversight role as the state's chief auditor.

"That is like somebody shooting their parents and saying, 'Give me mercy because I'm an orphan,'‚óŹ" said state Sen. Tim Grendell, a Republican candidate for attorney general from Chesterland. "It is Betty Montgomery's job to be auditing and making sure this kind of theft of public assets didn't happen."

Mr. Grendell added, "If she's shocked, she should look in the mirror because she has no one to blame but herself."

State Sen. Marc Dann State Sen. Marc Dann
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Ms. Montgomery, who first learned of the Ohio Bureau of Workers' Compensation's $50 million investment with Mr. Noe in 2004, has been under scrutiny for waiting 43 days after The Blade reported on problems with the investment to order a special audit. Mr. Grendell and other political rivals charge that her delay could be attributed to "incompetence" or a failure to take action against a political contributor.

The auditor said yesterday it was "not a failure to act" and that a couple of missing coins - as reported in The Blade's initial April 3 story - was not enough to constitute a special audit. Ms. Montgomery said she had been in communication with investigators, and that a Blade report on May 1 that an additional 119 coins were believed to be missing made it clear that a special audit was necessary.

"That gave us, under our standards, the ability to open our own audit," Ms. Montgomery said. "We started acting immediately. Just because we are not waving a banner and shouting doesn't mean we are not doing something."

Still, Ms. Montgomery's spokesman told The Blade on May 10 that a special audit was not needed "at this point in time." An audit was not called for until May 16, and outside auditors were not hired until July 1.

Ms. Montgomery said yesterday that her conduct was "the professional way to do it," adding, "it's how I would do it again despite the pounding I'm getting from The Toledo Blade [for] waiting 43 days."

Keary McCarthy, a spokesman for Subodh Chandra, a Democratic candidate for attorney general and former director of the Cleveland law center, said yesterday: "It's a sad state of affairs when an auditor of state has to rely on newspapers to be the watchdogs of state funds."

State Sen. Marc Dann, a Democratic candidate for attorney general from suburban Youngstown, characterized Ms. Montgomery's special audit as "300 pages of coverup" because it did not hold statewide officeholders and bureau officials, including the governor, accountable for the breakdown in oversight.

Secretary of State J. Kenneth Blackwell, a Republican candidate for governor, said the special audit provides more evidence that his opponent in the GOP primary, Attorney General Jim Petro, failed to protect the state's interest and take swift legal action against Mr. Noe. Mr. Blackwell released an ad campaign this week accusing Mr. Petro trading influence for campaign contributions, which featured an image of Mr. Noe.

"The loss is real, but the pattern is even more disturbing," Mr. Blackwell said yesterday.

Mr. Petro, who filed a lawsuit against Mr. Noe in May, has deflected criticism of his handling of the case, saying he took legal action as soon as he had a strong enough case to move forward.

"Ken Blackwell has never let the truth get in the way of a good sound bite," said Bob Paduchik, Mr. Petro's campaign manager. "The fact of the matter is that Jim Petro has done more than any other state official to protect state dollars and go after Tom Noe, and Ken knows that is the truth."

With the primary elections about two months away, and the November elections on the horizon, Stephen Brooks, a political analyst, said he expected the audit's findings to hurt the Ohio GOP in general - not just Ms. Montgomery.

"These kinds of examinations and these kinds of quotes basically say to people, your government's not working," said Mr. Brooks, the associate director of the Ray C. Bliss Institute of Applied Politics at the University of Akron. "And if you've been in charge 12 years, that's not something you want to hear."

Politics Writer Jim Tankersley and Columbus Bureau Chief James Drew contributed to this report.

Contact Steve Eder at:

seder@theblade.com

or 419-724-6272.



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