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Tom Noe stands between attorneys Bill Wilkinson, left, and Jud Scheaf during a news conference.
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Noe says Ohio rare-coin funds made $11M; state questions claim

Noe says Ohio rare-coin funds made $11M; state questions claim

COLUMBUS - Seven months ago, attorneys for Tom Noe told authorities that they could expect a shortfall of up to $13 million in Ohio's $50 million rare-coin venture. But yesterday Mr. Noe and his attorneys said the Ohio Bureau of Workers' Compensation investment should be worth $61.8 million when all of the ventures' inventory, stock, and loans are accounted for, leaving a profit of about $11.8 million.

At a news conference yesterday, Mr. Noe, speaking publicly for the first time since authorities raided his Monclova Township headquarters in May, refused to answer questions from reporters. His attorney, Bill Wilkinson, would not comment about his earlier statement about a $13 million shortfall or more recent allegations of theft.

"Our purpose in coming here today was to try to help the public understand the actual results from operations of the coin funds, so no one would be misled by the inaccurate characterization of the coin fund as a failed one," Mr. Wilkinson said.

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Lucas County Prosecutor Julia Bates dismissed the news conference as an attempt to sway the public, prospective jurors, and newspaper publishers.

"They're sending spin out into the world," said Ms. Bates, whose office is criminally investigating Mr. Noe and possible wrongdoing associated with the coin funds.

Even if the coin funds have increased in value, it doesn't necessarily mean a crime wasn't committed, she said.

Ms. Bates said Mr. Noe's attorneys could be attempting to influence public opinion to weaken calls for vigorous prosecution. But it won't have any affect on her investigation, which has been ongoing since August, when a special grand jury began hearing evidence in Lucas County, she said.

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Attorney General Jim Petro in May filed a lawsuit against Mr. Noe in an effort to recover money believed to be missing from the coin funds. Mr. Petro has presented evidence to the court that Mr. Noe stole $4 million from the coin funds.

Mark Anthony, a spokesman for Mr. Petro, noted yesterday that Mr. Noe and his attorneys did not answer questions about the coin funds' shortfall and the alleged theft.

"They could not, and still cannot, account for $13 million in the coin-fund assets, and we brought compelling evidence of at least a $4 million in conversion," Mr. Anthony said.

Mr. Anthony also said the numbers presented by Mr. Noe and his attorneys were "hypothetical."

"Hypothetical numbers always make sense in a hypothetical world," Mr. Anthony said.

Ohio Inspector General Tom Charles stressed that in addition to the Lucas County grand jury, a federal grand jury is hearing evidence about the investment scandal within the Bureau of Workers' Compensation.

"So what one individual has to say, I have no comment on it," said Mr. Charles, who added that he was not aware of any plans for Mr. Noe to meet with prosecutors during his stay in Columbus.

During the 15-minute news conference in a room at his lawyers' office, Mr. Noe and his attorneys stood in front of a poster-sized graphic explaining how they believe the coin funds turned a "profit."

Mr. Noe and his attorney said they used information from public reports, Development Specialists Inc., which is the firm that the state hired to liquidate the rare-coin investment, and other "third" parties to reach their estimate of $61.8 million.

The estimated figure includes:

●$7.9 million in alleged profits already distributed to the bureau.

●$16.775 million, which has already been liquidated.

●$100,000 in outstanding stock.

●$4.08 million in outstanding loans.

●$33 million in coin inventory.

Retired Judge William Bodoh, who was appointed to oversee the liquidation of the coin funds, said the projections presented at the news conference do not seem to line up with the actual numbers from coin-fund records.

"We are in the midst of liquidating the funds and this does not appear to reflect liquidation," said Mr. Bodoh, who plans to study the information presented by Mr. Noe.

According to the bureau's records, Mr. Noe told the agency that the coin funds would earn about 10 percent a year, for a total profit of $27.5 million on the $50 million investment. The profit distribution of $7.91 million Mr. Noe presented yesterday did not match that ambitious claim.

Nor did the profit distribution accurately reflect the financial health of the coin funds. On Aug. 22, 2001, Mr. Noe paid the bureau $776,839 in profits from the first coin fund. Mr. Petro has accused Mr. Noe of taking those "profits" from the second coin fund, which the bureau created only weeks earlier.

And while Mr. Noe bragged about beating the stock market, much of his alleged profits were due to the secretive purchase of one stock, the Escala Group, in 2002. According to the second coin-fund's general ledger, coin sales only generated a 3 percent return.

Mr. Noe spoke during the news conference when prompted by his attorneys only about an outstanding loan with a Florida-based coin-grading company and a dispute with one of his former employees in Colorado.

Authorities were forced to obtain a warrant to raid Mr. Noe's Monclova Township headquarters in May after he refused to allow them to inspect the state coin-fund inventory.

Asked at yesterday's news conference why authorities needed a search warrant, Mr. Noe responded: "First of all, I'm not answering any questions, as we've said before."

In October, Mr. Noe, a Republican contributor and fund-raiser, was indicted on three felony charges alleging he laundered money into President Bush's re-election campaign.

Mr. Noe is free on a $350,000 bond and living in a $2 million home in the Florida Keys.

Scott Travers, a coin expert and author, said the coin market is the strongest he has seen during his career and he expected liquidators to be able to sell off the remaining coins at a "significant profit" - even if money was misappropriated.

"I would not be surprised that if even there were $10 million or $14 million or $12 million missing - to see those coins sell for an amount over and above the original investment of the state of Ohio," Mr. Travers said.

Franklin County Prosecutor Ron O'Brien said until the coin funds are liquidated, their value can't be accurately determined.

"Until the coin funds would be liquidated, any comments by me or Mr. Wilkinson regarding the value are estimates," Mr. O'Brien said.

Jen Detwiler, a spokesman for state Auditor Betty Montgomery, said the forensic accounting firm hired to examine the state's rare-coin investment is working with federal and state prosecutors. She said the findings would not be released until the documents, which are part of the investigation, become public.

Referring to the limited remarks yesterday by Mr. Noe and the brief presentation by his attorney, Ms. Detwiler said: "We do not pretend to know what they are saying, because they did not say anything."

Staff writers Mike Wilkinson and Joshua Boak contributed to this report.

Contact James Drew at: jdrew@theblade.com or 614-221-0496.

First Published December 22, 2005, 11:33 a.m.

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Tom Noe stands between attorneys Bill Wilkinson, left, and Jud Scheaf during a news conference.
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