Prosecutor: Noe needed money

The prosecutor said 96 percent of the coins Noe said he owned were borrowed.
TOLEDO (AP) -- A politically connected coin dealer accused of stealing from a 50 million state investment was deep in debt when he got the money, and he quickly used that money to pay back creditors, a prosecutor told a jury Monday.
Within a week Tom Noe put 1.75 million into his own business and wrote himself a 135,000 check to support "a lifestyle he felt he deserved," Lucas County Assistant Prosecutor John Weglian said in his opening statement at Noe's trial.
"He needed money," Weglian said. "He needed it desperately."
Noe, once a go-to guy for the Republican Party, has pleaded innocent to theft, money laundering, forgery and corrupt activity charges. He is accused of stealing more than 2 million and spending it on his business and renovating his home in the Florida Keys. He faces up to 10 years in prison on the corrupt activity charge.
The scandal has become a central political issue in Ohio over the past 18 months and has contributed to trouble for Republicans who have dominated the state since 1990.
Capitalizing on scandal
Democrats hoping to capitalize on the investment scandal in the November election say Noe was selected to oversee the state investment in coins because of his political ties.
Defense attorney William Wilkinson said Noe's contract with the Ohio Bureau of Workers' Compensation allowed him to borrow money from the investment fund or lend it to others.
"You can't steal something from the owner of property if they give you permission to use it," Wilkinson said.
The state fund for injured workers initially invested 25 million with Noe in 1998, followed by another 25 million in 2001.
Weglian told jurors that Noe put 1.75 million into his business after the first payment so that he could pay off bank debts.
He said Noe kept two sets of financial records -- one for the workers' comp agency and one for his own business. When state officials wanted to check on the status of the coins Noe told them he had bought, he created false documents and borrowed coins from other dealers to trick investigators, Weglian said.
"If Tom Noe wasn't a thief, he wouldn't have had two sets of books," Weglian said.
Noe spent only a fraction of the Bureau of Workers' Compensation investment money on coins, and when state investigators began looking into the investment in 2005, 96 percent of the coins Noe said he owned actually were borrowed from others, Weglian said.
Wilkinson said the bureau gave Noe wide authority to manage the investment and that he spent millions buying other collectibles such as historical documents and rare paintings.
The bureau knew in 1999 that the contract with Noe allowed him to use the money as he saw fit, and that no one from the bureau objected, Wilkinson said. It was just two years later that the bureau gave Noe an additional 25 million to invest, he said.
The fund will end up showing a profit because of all the investments in collectibles, Wilkinson said.
Ohio Inspector General Tom Charles testified that his office began looking into the fund after reading a series of newspaper articles in The Blade and receiving letters from several state Democratic senators urging him to investigate.
Charles testified that his investigators were initially turned away in May 2005 when they first attempted to check on the number of coins Noe had bought with the state's money.
The bureau's director of investigations, Tom Wersell, said investigators a month earlier gave Noe four days advance notice of a spot check they performed on coins at his business.
It was during that spot check that, prosecutors said, Noe produced fake documents explaining the whereabouts of coins bought with the state money.
Noe, once a member of state boards that oversee the Ohio Turnpike and Ohio's public universities, was a top GOP fundraiser who gave more than 105,000 to Republicans including President Bush and Gov. Bob Taft during the 2004 campaign.
In a different case, Noe pleaded guilty earlier this year to funneling 45,000 to Bush's re-election campaign and was sentenced last month to two years and three months in federal prison. He won't begin that sentence until after the state charges are resolved.
Investigations into the coin investments led to separate ethics charges against Gov. Bob Taft, who pleaded no contest last year to failing to report golf outings and other gifts.

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