May 26, 2005

Ohio Officials Now Believe More Than $10 Million in Rare Coins Is Missing

By Carrie Spencer
Associated Press Writer

COLUMBUS, Ohio (AP) - A scandal over Ohio's investment in rare coins deepened Thursday as authorities learned that more than $10 million in coins may now be missing. The state said it would prosecute and sue the fund's former manager.

Authorities originally had suspected that coins worth an estimated $400,000 had vanished, but an attorney for the fund manager told inspectors that $10 million to $12 million is missing, the state attorney general's office said.

That is about 20 percent of the $55 million investment by the Bureau of Workers' Compensation, which got into rare coins in the late 1990s as a way to hedge its investments in stocks and bonds.

"Such criminal action is outrageous and will not be tolerated," Gov. Bob Taft said in a news release. "We will pursue all legal avenues possible to recover these funds for injured workers and employers."

The focus of the investigation is Tom Noe, a private coin dealer and Republican donor who led the coin investment. Democrats have alleged that Noe was awarded the state's business in return for campaign contributions to Republicans, who control most of state government.

Officials do not know what assets are missing or where those items are supposed to be, bureau spokesman Jeremy Jackson said. Investigators had gone into Noe's coin shop under a court order issued Thursday morning, but weren't able to remove coins from their cases to inspect them and verify authenticity, Jackson said.

The bureau had made $15.3 million from the investments while Noe has collected about $3.8 million in commission. His shop outside Toledo had one of the two largest coin caches in the collection.

About a dozen cars were in the shop's lot Thursday, and a sign on the door read, "Closed for inventory." No one answered a knock.

"Mr. Noe will continue to cooperate with the investigation," said Jud Scheaf, a legal partner with Noe's attorney. He could not provide more details.

Questions about the investment surfaced in April when The Blade newspaper of Toledo found that two 1800s-era gold coins had disappeared. Noe said they were sent to a Colorado coin dealer but got lost in the mail in 2003.

The newspaper then reported that 119 other coins were missing. Noe said he thought the coins had been stolen by the Colorado dealer, whom he hired to assist with the fund.

The state responded by announcing plans to sell off its coin collection, which represents less than 1 percent of the bureau's total $14 billion in investments. AP-ES-05-26-05 1947EDT

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