Ohio Scandals May Give Democrats a Lift

If the Democrats get traction on the scandal issue in Ohio, it likely will be because of the dealings of Noe, an entrepreneur who parlayed his political ties into the chairmanships of the Ohio Turnpike Commission and the Ohio Board of Regents.

In Toledo, he chaired the Lucas County Republican Party, as did his wife, Bernadette, and contributed generously to GOP candidates at all levels. He was so anxious to honor his pledge to the Bush-Cheney campaign, prosecutors said Oct. 27 in issuing a three-count indictment, that he funneled money through friends, including local elected officials.

Noe was later named one of 19 Ohio "Pioneers," those who had raised at least $100,000 for the president's successful reelection. There is no evidence that Bush-Cheney officials knew of the alleged laundering operation, investigators said. A total of $6,000 contributed directly by the Noes to the presidential campaign and the Republican National Committee has been donated to charity, said RNC spokesman Aaron McLear.

Investigators for the Ohio Ethics Commission, highway patrol, attorney general's office and an array of other agencies have uncovered a web of business transactions they are still trying to untangle. Central to the case are two stakes of $25 million each that Noe was given by the Bureau of Workers' Compensation to invest in rare coins, artwork and other collectibles.

The money, a small fraction of a fund valued at more than $15 billion, was intended as a creative way to diversify the bureau's portfolio. After the Toledo Blade revealed Noe's coin investment contract in April, an agency spokesman said that "there is not one iota of evidence showing politics played a role."

Investigators continue to examine that issue. Taft said he was fooled by Noe and did not know of the coin stake until the Blade reported it -- a point disputed by Noe. Ohio Inspector General Thomas P. Charles asked Taft about his staff receiving benefits, leading to the governor's disclosure of 52 gifts from an array of people -- such as golf outings, meals and hockey tickets -- that he had failed to report as required by public ethics laws.

A tearful Taft pleaded no contest Aug. 18 to misdemeanor charges. After vowing earlier not to tolerate ethics violations in his administration, he said he had failed to live up to his own standards and public expectations.

"I am disappointed in myself," said Taft, the son and grandson of U.S. senators and the great-grandson of President William Howard Taft. "I just want to say there are no words to express the deep remorse that I feel over the embarrassment I have caused."

Two Taft aides pleaded no contest to accepting items of value from Noe. Ohio newspapers have identified two other former staff members as having received loans from Noe, who allegedly treated members of the governor's staff so often that dinners were called "The Noe Supper Club."

"It was a two-way street, back and forth, where influence was used and influence was sought," said one investigator who spoke on the condition of anonymity because the inquiry is continuing.

Noe's attorney has said more than $11 million is missing from the coin fund that Noe established with workers' compensation money. Attorney General Jim Petro (R), who has joined the large field of contestants for next year's open governor's race, filed a civil lawsuit accusing Noe of diverting as much as $4 million for his own use.

Ethics specialists and prosecutors working on the continuing investigation say they do not yet know whether state money was channeled to political campaigns or what Noe may have received in return for his largess.

The Bureau of Workers' Compensation, meanwhile, fired 69 investment managers this month and announced that it will shift $7.2 billion from the stock market into safer fixed-income investments. The coin investments -- the ones the bureau can find -- are being liquidated.