[MSN] Less than a month before Election Day, a politically connected coin dealer accused of embezzling from a state investment in rare coins went on trial Monday in a scandal that has rocked Ohio's Republican Party.

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Coin Dealer Trial Begins in Ohio Scandal 
- By JOHN SEEWER, Associated Press Writer
Monday, October 16, 2006 


(10-16) 12:38 PDT Toledo, Ohio (AP) -- 


Less than a month before Election Day, a politically connected coin dealer
accused of embezzling from a state investment in rare coins went on trial
Monday in a scandal that has rocked Ohio's Republican Party.


Tom Noe, 52, is accused of stealing more than $2 million from a fund for
injured workers and spending it on his business and renovating his home in
the Florida Keys.


"He needed money. He needed it desperately," prosecutor John Weglian said in
opening statements.


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.


He is charged with corrupt activity, theft, money laundering and forgery. If
convicted, he could get up to 10 years in prison on the corrupt activity
charge alone.


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 loan it to others.


"You can't steal something from the owner of property if they give you
permission to use it," Wilkinson said.


Federal prosecutors have not said whether any of the coin money was used for
political contributions. If the state money had been funneled to campaigns,
authorities could have sought a stiffer penalty.


The scandal has raised Democrats' hopes of retaking the governor's office
from the GOP, which has dominated the state since 1990. Democratic Rep. Ted
Strickland has held a double-digit lead in the polls over Republican nominee
Ken Blackwell, Ohio's secretary of state.


The state invested $50 million with Noe from 1998 to 2001, but Weglian said
he spent only a fraction of that figure on coins.


Prosecutors 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.


Wilkinson said the workers' comp agency gave Noe wide authority to manage
the investment and that he spent millions buying other collectibles such as
historical documents and rare paintings. He also said the workers' comp fund
will end up showing a profit because of Noe's investments in collectibles.


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 more
than two years in federal prison. He will not 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.


The trial is expected to last at least six weeks, through the Nov. 7
election.


URL:
http://sfgate.com/cgi-bin/article.cgi?file=/n/a/2006/10/16/national/a123858D
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