Ohio BWC's coins investment just keeps getting better...
DAM
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This article is in todays Dayton Daily News.
COLUMBUS | The growing controversy surrounding Tom Noe, a Toledo-area coin dealer and prominent Republican, spilled over into the Ohio Supreme Court on Wednesday as five of the court's six Republican justices recused themselves from hearing two cases involving Noe and the Ohio Bureau of Workers' Compensation.
Chief Justice Thomas J. Moyer and four Republican justices - Evelyn Lundberg Stratton, Maureen O'Connor, Terrence O'Donnell and Judith Ann Lanzinger - all have received campaign contributions from Noe and his wife, Bernadette. Also, Noe of Maumee served as campaign chairman for Lanzinger in her successful 2004 supreme court campaign.
Justices Alice Robie Resnick, a Democrat, and Paul Pfeifer, a Republican, will continue to hear the two cases, with Resnick serving as chief justice because of her seniority. She will assign state appeals judges as visiting judges.
A review of state campaign finance records dating to 1996 found no contributions from the Noes to Resnick and Pfeifer.
Contributions from the Noes to the five Republican justices since 1996 were: Moyer, $5,250; O'Donnell, $5,250; Lanzinger, $5,000; O'Connor, $5,000; and Stratton, $3,210.79.
Moyer removed himself from the case because "the contributions could raise the perception that whatever decision is made could have been made on something other than the merits."
He said the reasoning of the other four justices was the same.
He said the situation demonstrates the need for a campaign system under which "at least at the supreme court level the justices should not be required to engage in a system that demands you have to raise ... over a million dollars."
The Noe controversy has been growing since April 3 when The (Toledo) Blade reported that the workers' compensation bureau had invested $50 million in rare-coin funds controlled by Noe, but that a bureau auditor had raised concerns about potential conflicts of interest and whether the state's money was being protected.
State Sen. Marc Dann, D-Warren, and The Blade have sued the bureau. Dann's lawsuit asks the high court to order the bureau to make available the inventory of coins in which it holds a financial interest, as well as records identifying from whom the coins were acquired.
The Blade said Dann's lawsuit "largely mirrors" its complaint.
Dann said he and the public have a right to know what the investments are.
Mark Landes, an attorney for Noe, said "trade secrets" are an exception to Ohio's public records law and that the coin collections involve trade secrets.
"Reputable coin people will tell you that you never reveal all of the inventory you have," Landes said.
He said Noe is a wholesaler. "If you want to go look at a wholesaler's coin, you sign a confidentiality agreement. They are very closely guarded," he said.
Although the bureau and Noe have defended the investment, the bureau, upon Noe's recommendation, has announced it would "dissolve the $50 million coin fund over a reasonable period of time sufficient to protect the state's investment."
The investment produced a return of $15 million since 1998, the bureau said. Noe and his partners have split $3.3 million as compensation, The Blade reported.
Landes said, "We believe that if the coins being held are widely known, the value of the assets of the state of Ohio will be diminished, there will be less money for injured workers."
For Dann, however, "There's a huge issue of why should we have our injured workers' money in this kind of risky, secret investment."
COLUMBUS | The growing controversy surrounding Tom Noe, a Toledo-area coin dealer and prominent Republican, spilled over into the Ohio Supreme Court on Wednesday as five of the court's six Republican justices recused themselves from hearing two cases involving Noe and the Ohio Bureau of Workers' Compensation.
Chief Justice Thomas J. Moyer and four Republican justices - Evelyn Lundberg Stratton, Maureen O'Connor, Terrence O'Donnell and Judith Ann Lanzinger - all have received campaign contributions from Noe and his wife, Bernadette. Also, Noe of Maumee served as campaign chairman for Lanzinger in her successful 2004 supreme court campaign.
Justices Alice Robie Resnick, a Democrat, and Paul Pfeifer, a Republican, will continue to hear the two cases, with Resnick serving as chief justice because of her seniority. She will assign state appeals judges as visiting judges.
A review of state campaign finance records dating to 1996 found no contributions from the Noes to Resnick and Pfeifer.
Contributions from the Noes to the five Republican justices since 1996 were: Moyer, $5,250; O'Donnell, $5,250; Lanzinger, $5,000; O'Connor, $5,000; and Stratton, $3,210.79.
Moyer removed himself from the case because "the contributions could raise the perception that whatever decision is made could have been made on something other than the merits."
He said the reasoning of the other four justices was the same.
He said the situation demonstrates the need for a campaign system under which "at least at the supreme court level the justices should not be required to engage in a system that demands you have to raise ... over a million dollars."
The Noe controversy has been growing since April 3 when The (Toledo) Blade reported that the workers' compensation bureau had invested $50 million in rare-coin funds controlled by Noe, but that a bureau auditor had raised concerns about potential conflicts of interest and whether the state's money was being protected.
State Sen. Marc Dann, D-Warren, and The Blade have sued the bureau. Dann's lawsuit asks the high court to order the bureau to make available the inventory of coins in which it holds a financial interest, as well as records identifying from whom the coins were acquired.
The Blade said Dann's lawsuit "largely mirrors" its complaint.
Dann said he and the public have a right to know what the investments are.
Mark Landes, an attorney for Noe, said "trade secrets" are an exception to Ohio's public records law and that the coin collections involve trade secrets.
"Reputable coin people will tell you that you never reveal all of the inventory you have," Landes said.
He said Noe is a wholesaler. "If you want to go look at a wholesaler's coin, you sign a confidentiality agreement. They are very closely guarded," he said.
Although the bureau and Noe have defended the investment, the bureau, upon Noe's recommendation, has announced it would "dissolve the $50 million coin fund over a reasonable period of time sufficient to protect the state's investment."
The investment produced a return of $15 million since 1998, the bureau said. Noe and his partners have split $3.3 million as compensation, The Blade reported.
Landes said, "We believe that if the coins being held are widely known, the value of the assets of the state of Ohio will be diminished, there will be less money for injured workers."
For Dann, however, "There's a huge issue of why should we have our injured workers' money in this kind of risky, secret investment."
Dan
0
Comments
This coin fund is a highly inappropriate way to invest public funds where transparency is mandated. Certainly heads need to and will roll after the dust settles.
In the meantime, it makes for a GREAT read.
Simply knowing that the policy is secretive would have made me far more anxious than otherwise about the bonifides of this coin fund. What a surprise to learn, then, that we now see all these discrepancies from sound investment management practices, resulting in desolution of the fund and emerging civil and possibly criminal charges aginst the principals. Perhasp someone ought to consider taking legal action as well against those who allowed the fund to operate in this non-transparent manner.
<< <i>Mark Landes, an attorney for Noe, said "trade secrets" are an exception to Ohio's public records law and that the coin collections involve trade secrets.
"Reputable coin people will tell you that you never reveal all of the inventory you have," Landes said. >>
Good lord, that's about the worst reasoning for anything I've heard this month.
I think I would dump any key date they had many multiples. Like the 1932-d quarters, etc. You could speculate all day on this. Oh it will be nice to see what they hold.
Mutual funds are required by law to disclose holdings on a semi-annual basis. Some voluntarily report holdings more frequently. Despite that the market for truly rare, investment-grade coins is much thinner than for even small cap stocks, small cap fund managers would probably prefer not to disclose their holdings. When a smaller small cap fund is on a bad performance streak, hedge fund managers delight in shorting the small cap fund's holdings, which can create a viscious cycle. Some say that this was in part responsible for the severity of the tech fund meltdown in 2000-2002. The principals at Pilgrim and Baxter (PBHG funds) were caught illegally shorting the assets in their own mutual funds!
As the assets are being sold, I see no advantage for the state to disclose the assets. After the fund is completely liquidated, I would favor full disclosure.
- any government investment needs to have full disclosure, especially when the person in charge of the money is getting a cut.
- rare coin funds have good reasons not to disclose their holdings
And thus, rare coins are a poor choice for government investments.
This business has enough hanky-panky as it is and using public funds to secretly invest in items which are fairly illiquid just doesn't cut it for me. It would be far too easy for someone who wasn't ethical to skim tons of untraceable money out of such funds, as long as the actual investments are not public.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
Details here
<< <i>I seen a special report on the news that Noe's coin shop was raided today. >>
It was raided yesterday. They showed state investigators there on the 11PM news last night and said they would be there all night!
<< <i>State of Ohio ripped by a (non-wannabe) Dealer? nah, can't happen(?) >>
Watch it, Noe is probably a friend of hers!!
{{This is one reason why judges should be appointed and not elected. }}
This is one reason why I disagree vehemently:
From the Commercial-Appeal Memphis TN
Drug bust is erased by judge
Says suspect with 33 pounds of cocaine not nervous enough
By Lawrence Buser
Contact
May 21, 2005
On a winter evening last year a veteran sheriff's deputy pulled over a silver Chevy Malibu with Texas tags for speeding on Interstate 40 and hit a jackpot.
Behind the wheel was Eric Berrios, a tall, bespectacled native of Puerto Rico who said he was headed to Maryland. Shelby County Deputy Kelly Nichols thought Berrios seemed unusually nervous, his hands shaking as he handed over his driver's license.
Nichols put Berrios in the back of the squad car to question him and, after getting written permission to search his car, found 33 pounds of cocaine -- worth more than $1 million on the street -- hidden near the front fender.
Berrios was charged with a drug crime that would carry up to 25 years in prison.
But in a hotly contested case headed for a state appeals court, a judge has ruled the deputy questioned and detained Berrios too long for a routine traffic stop and the driver did not appear to be nervous enough on the officer's dashboard video to suspect criminal activity.
The result: the charge against Berrios is 33 pounds lighter.
"(The cocaine) is fruit of the poisonous tree and cannot be used against the defendant," Criminal Court Judge Paula Skahan said in an 11-page ruling.
Defense attorney William Massey applauded Skahan's ruling, a rare decision in a suppression hearing because, he said, the law governing such search-and-seizure stops is "officer friendly."
"At what point does good police work violate our rights to privacy?" Massey said. "Most citizens will side with good police work until it's their right to privacy that's violated."
State prosecutor Valerie Smith said the reason such suppression rulings are rare is because officers do their jobs properly and follow the law.
"The law and the Fourth Amendment (against unreasonable searches and seizures) are not meant to be get-out-of-jail-free passes," said Smith, who is appealing Skahan's ruling. "Laws are there to protect the citizens of Tennessee from persons possessing 33 pounds of cocaine."
Berrios was stopped at 7:39 p.m. on Feb. 25, 2004, on the north leg of I-40 near Watkins headed east. He was doing 53 in a 45 mph construction zone.
Judge Skahan had no problem with how the consent was obtained, even complimenting Nichols for his "nonthreatening, professional and courteous manner." But, she said, there was no legal reason this particular speeding stop should have gotten to that point.
She did not rule out the possibility that nervousness can be a criminal indicator, but said her multiple reviews of the dashboard video did not convince her Berrios was nervous enough to become a suspicious character worthy of further investigation.
"Nichols's detention was a process designed to exploit the underlying traffic stop, culminating in the asking and receiving of consent to search the vehicle," Skahan said in an expanded ruling Friday.
Earlier this week Skahan lowered Berrios's bond to $25,000 from $150,000.
"Right now when I walk out of here I'm starting from scratch again," said Berrios, who lived in Houston but said he hopes to move in with a brother in Philadelphia. "This is the only blemish I've had in my life."
And he won't be getting the cocaine back. Illegal drugs typically are incinerated when a case is completed.