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Published: Sunday, 7/2/2006

Investigators' handling of Noe case raises questions; just 1 of 24 alleged conduits prosecuted for donations

BY MIKE WILKINSON
AND JAMES DREW
BLADE STAFF WRITERS

Like a baseball box score, the Tom Noe campaign-finance cases have some important numbers:

$45,400. The amount of money Noe illegally laundered into the Bush campaign.

24. The number of people Noe allegedly used as conduits.

5. The number of campaigns into which Noe allegedly used conduits.

4. The number of public officials convicted last week of failing to disclose their Noe money.

But perhaps the number that has raised the most questions is 1 - the number of people prosecuted for being a conduit.

Despite evidence that Noe used more than two dozen people to help him multiply his political giving, only former Taft aide Doug Talbott has paid the price. He admitted last year to taking Noe money and contributing it to three Ohio Supreme Court justices.

Investigators last week released a report that showed former Republican state Rep. Sally Perz was a "probable" Noe conduit into the 2002 Taft campaign. It was the third instance in which Noe was identified as using others to make contributions.

Only Doug Talbott, a former aide of Bob Taft, was prosecuted as a conduit. Only Doug Talbott, a former aide of Bob Taft, was prosecuted as a conduit.
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But to date, Mr. Talbott remains the anomaly. None of the federal conduits was charged because they cooperated. Lynn Grimshaw, the special prosecutor, told The Blade on Thursday that he didn't charge Ms. Perz for allegedly being a state-level conduit because he was "satisfied with Ms. Perz being convicted of one misdemeanor offense." She pleaded no contest to an ethics violation for failing to disclose money for a meal from Noe at a Oct. 30, 2003, fund-raiser for President Bush.

Now investigators find themselves answering questions about their work. How hard did they look for Noe conduits into state campaigns? Were other conduits identified? Will they be prosecuted?

Catherine Turcer, legislative director for Ohio Citizen Action, said the decision to not charge the federal conduits or Ms. Perz for being a state conduit "is about people passing the buck, so to speak."

"We let them off the hook, which then makes one wonder whether using conduits is so commonplace. It won't stop being ordinary or common if they don't do more than slap them on the wrist. How do you stop this illicit, illegal, and inappropriate conduct if they give them a pass every time?" she said.

Trying to pin down conduit convictions is difficult, investigators say.

You need proof from one side or the other. In the federal case, U.S. Attorney Greg White said it was Justice Department policy to use the conduits, through an offer of immunity, to get the Noe conviction.

"It's very difficult to prove those type of matters without the cooperation of those [conduits], those who didn't put up the money," Mr. White said last week. "You need those people in essence to show the money trail."

Likewise in the state cases, said Paul Nick, chief investigative attorney for the Ohio Ethics Commission.

Ms. Perz invoked her Fifth Amendment rights "on more than one occasion,'' said David Freel, executive director of the Ethics Commission. She also would not consent to a sworn interview, Mr. Nick said.

Asked if charging Noe for giving money to a conduit could have provided more information about what happened with Ms. Perz, Mr. Nick replied: "It could have. That's the problem with these cases. In order to crack the nut, you need one side or the other to give a confession."

Mr. Freel said Noe was interviewed about his $2,500 check to Ms. Perz dated May 10, 2002 - the day she attended a Taft fund-raiser where she contributed the same amount. Mr. Freel would not comment on what Noe told investigators and said a transcript was not included in the investigative report "because it may be part of a broader investigation." He declined to elaborate.

When asked if there were other Noe conduits at the May 10, 2002, fund-raiser in Columbus for Gov. Bob Taft's re-election campaign that featured President Bush, Mr. Freel replied: "Not as far as I know." He said he didn't believe records were subpoenaed from the Taft campaign.

Inspector General Tom Charles declined to discuss the review of Ms. Perz's case or whether investigators are looking at the May 10, 2002, fund-raiser.

Mr. Nick said the check to Ms. Perz is the only questionable one from Noe in relation to the May 10, 2002, fund-raiser for Mr. Taft.

"This is the one that came up. It's the one we investigated and it was inconclusive. We didn't have an admission to its purpose. The law does not prohibit making a donation. The law prohibits making a donation that is intended from someone else. You can make the allegation, which was done in the report, but to prove it beyond a reasonable doubt is a whole different standard,'' he said.

Investigators indicated in the report given to Mr. Grimshaw that they would refer questions about the Perz-Taft contribution to the Ohio Elections Commission, but that never happened, said Mr. Nick, the commission's chief investigative attorney.

"We put that in front of Grimshaw as an option and said, 'Here is everything we think could be evidenced' and then left it to his discretion,'' Mr. Nick said.

Democrats still bristle that none of the conduits, especially the public officials convicted Wednesday for related state ethics violations, were prosecuted.

Chris Redfern, chairman of the Ohio Democratic Party, said the federal deals made with the 24 alleged conduits were inappropriate.

"For the U.S. attorney's office to offer immunity to all [conduits] is ridiculous," he said. "You need one person to get immunity and good investigators to get the other 23."

Mr. White said his office worked with officials in the public integrity section of the Justice Department on the case - hailed as the largest conduit scheme since the most recent revision of federal campaign-finance laws. He said it was prosecuted in Toledo like it would be in Indiana or California.

"We followed in this case according to the policy," he said. "Public Integrity tries to be consistent across the board."

Julia Bates, the Lucas County prosecutor whose initial investigation into Noe led to his federal charges, did not criticize Mr. White and his decision.

"They did what they thought was appropriate given what they were trying to accomplish," she said.

In the spring of 2004, after Noe's wife, Bernadette, made allegations about Joe Kidd, the former executive director of the Lucas County Board of Elections, that proved unfounded, Mr. Kidd told prosecutors about Noe's alleged conduit contributions to the Bush campaign, including his own. By October, bank records obtained by subpoena appeared to prove Mr. Kidd's conduit claims.

Ms. Bates then sent the matter to the U.S. attorney's office in Toledo, which began the investigation. Most of the alleged conduits later testified before a federal grand jury, including the four women found guilty last week. Noe was indicted in October and pleaded guilty in May; he awaits sentencing.

Ms. Perz was found guilty Wednesday of failing to disclose money from Noe for a meal - at the Oct. 30, 2003, Bush fund-raiser. She was fined $1,000 plus costs, as were three other prominent Republicans: Maggie Thurber, the first female GOP Lucas County commissioner; Toledo Councilman Betty Shultz, one of the longest-serving female politicians in the state, and Donna Owens, the first female mayor of Toledo and former Taft appointee to the state Industrial Commission, which resolves disputes over benefits provided by the Ohio Bureau of Workers' Compensation.

Noe faces more than four dozen felony counts in Lucas County Common Pleas Court on allegations that he stole millions of dollars from the two rare-coin funds he managed for the bureau. His trial is set for October.

Since 1990, campaign-finance records show that Noe and his wife have contributed more than $200,000 to candidates and political parties across Ohio and the country. That does not include the $45,400 he poured into the Bush campaign in the conduit scheme or the $4,000 he gave to Ms. Perz and Mr. Talbott for Governor Taft and the Supreme Court justices.

It also doesn't count the $65,000 he gave to the Lucas County Republican Party as loans; only $2,000 was paid back. Nor does it include the tens of thousands of dollars he raised at fund-raisers at his homes.

For more than a decade, Noe was a darling of Columbus. Former Gov. George Voinovich appointed him to the Bowling Green University Board of Trustees and later to the Ohio Board of Regents. Governor Taft reappointed him to the regents and selected him for the Ohio Turnpike Commission.

Noe resigned last fall as the toll climbed. Within months, the governor and some of his former aides were convicted.

But critics wonder if more could have been discovered, if more questions about politics and fund-raising could have been answered.

Ms. Turcer, the legislative director of Ohio Citizen Action, said the lack of charges against conduits - on the federal and state level - is a failure of the system.

"It is astonishingly painful to imagine that this kind of monkey business is happening and the judicial system does not seem to care," she said.

Contact Mike Wilkinson at: mwilkinson@theblade.com or 419-724-6104.



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