Like everyone else I am having trouble thinking about anything other than the coronavirus pandemic and the shockwaves it has sent, and will continue to send, through the system. As it began to unfold I found myself thinking, talking, and posting about it fairly constantly. In an effort to try to keep it confined to a given time and place, both physically and psychologically, I am keeping a diary of it all.
Follow this Category for all entires.
April 17: Today’s entry will be a little bit different than usual. If you want to hear about my life in quarantine, come back tomorrow. This is a pretty good story, though.
The woman from the state auditor’s office kept looking out the window next to the front door. Then she’d check her watch, pace around a bit, and do it again. She had been to that door a half dozen times in the previous half hour. Each time, from where I was sitting, it looked like the same old parking lot of the same old office park in the same boring Toledo, Ohio suburb. I had no idea what she was expecting.
After she finished looking for the fourth or fifth time she came back and joined her colleagues at the conference table in the middle of the room. There were a half dozen of them in business casual standing around the table counting coins. Rare, collectible coins, stored in little plastic and cardboard covers, several dozen per box.
One of the auditors would take out a coin and read its label – “1841 Liberty Seated Half Dime” – and another would check it off a list. “1921 Walking Liberty Half-Dollar.” “Check.” Three teams of two auditors each, methodically checking the stock of rare coins against a list on their clipboard.
This wasn’t a normal audit. Less than a week earlier my client – the guy who owned the coin and sports memorabilia shop in the front of the building and whose personal office was in the back of the building in which we were all now sitting – found his name plastered on every newspaper in the state. He was in the news because it was revealed that the State of Ohio had, several years prior, given him $50 million from the state worker’s compensation fund to invest on its behalf.
Now, it was not unusual for the state to give money from its various trust and pension funds to private investors to handle. Until a few years back these public funds only invested in bonds, but when Republicans took over they changed the law to allow them to invest in all manner of private securities in order to realize a greater return. Or, if you’re the skeptical type, in order to benefit private financial interests who could then take healthy commissions from public investments. I’ll let you make up your own mind about what the real motivation was. Point was, there were dozens if not scores of private businesses out there managing millions and millions of public funds on behalf of the State Ohio. It was, by May 26, 2005, the day I was sitting in this office, watching auditors count coins, public knowledge.
Normally, though, these investments were stocks and real estate investments. The $50 million given to my client, however, was invested in something a bit less conventional: rare coins and collectibles, which made up his personal business.
He had written up quite official-looking prospectuses and made representations about what kind of return the taxpayers of Ohio would realize on shares in funds that invested in gold, silver, and platinum. And baseball bats used by Mickey Mantle. And rare letters sent by Teddy Roosevelt to his Secretary of War. And, my favorite, a six-foot velvet banner from 1863, owned by the United States government, which accompanied copies of the Emancipation Proclamation as they made the a train tour of the northern states, promoting Lincoln’s freeing of the slaves to the public.
These items and hundreds more were held, bought, or sold at my client’s discretion in service of giving Ohio appealing investment returns. He and his staff kept detailed inventory lists of each and every coin and collectible bought, sold, or currently held. The holdings of “The Coin Fund,” as it came to be called, since the investment was legally in shares of a business as opposed to physical coins itself, were audited by a private auditing firm every year.
That, while something one could learn if they knew what to look for and issued a public records request, was not really public knowledge. It was something that came as news to the local newspaper, the Toledo Blade, when someone tipped them off that my client, a prominent Toledo personality who, in addition to his rare coin and memorabilia business, was deeply involved in Republican politics, had been given $50 million to invest by state officials, who were also Republicans. The Toledo Blade’s politics were not aligned with my client’s — the people who ran the paper actually hated his guts for a dozen reasons — so it began investigating the Coin Fund.
The investigation did not, initially anyway, find anything legally problematic. It published a lot of stories about my client and his business, however, and anyone who has had involvement with the rare coin and memorabilia industry knows that it’s full of, let’s say, colorful characters. Weird people, really. Some are downright shady. Serious criminality is rather minor — the mob and Mexican drug cartels don’t collect baseball cards — but there’s a lot of cash floating around and a lot of guys doing multi-million dollar deals in vans and hotel rooms. Personal expertise matters a lot, so even if you’re someone who, say, did three years in prison for something, when you come back out you’re still one of the few experts around, so you’ll probably find work again.
It’s the kind of world that, after a month or so of a newspaper writing about it, made politicians understandably uncomfortable to be associated with it. So, as the Blade kept publishing stories about my client, his coins and collectibles, pressure mounted on my client’s benefactors down in Columbus — the governor, the attorney general, officials at the Bureau of Worker’s Compensation whose money was being invested — to say something or do something.
At first they said everything was fine. The governor, Bob Taft, told the press that he was informed that, however unconventional the investments seemed, the Coin Fund had made millions for the state. Which, yes, the private audits had said it did. He said that even though my client was a personal friend of his — they had played golf together many times — the entire process of granting him the $50 million investment was on the up-and-up. The money was all well-accounted for and there is nothing to be worried about.
As the governor was saying all of this, however, my client had hired my boss and, by extension, me, to represent him, because it was pretty clear trouble was brewing. As the governor told everyone there was nothing to see here, my boss took meeting after meeting with increasingly frantic state officials, concerned that this politically connected coin dealer from Toledo was going to get them into deep shit. As those meetings happened, I was dispatched to three different cities to investigate the Coin Fund’s holdings — coins and collectibles which were physically held in unassuming-looking memorabilia shops and warehouses owned by subsidiaries (i.e. friends of my client who were in the same business) to see if there was anything to be worried about.
At a shop in the Philadelphia suburbs a man who called himself a “co-manager” of the Coin Fund gave me a hastily printed-out sheet of paper with lists of rare coins, showed me his vault and said “they’re all in there.” There was no way for me to know that what I was actually seeing was actually owned by the Coin Fund, though. There was no audit trail. It was as if someone stood in front of a mansion, gave you a printed out Microsoft Word document that said “Yeah, I own this house” and you had to take his word for it.
From Philly I flew to an office park in Sarasota, Florida. The guy in charge had better records there. Things looked at least quasi-official, and an actual accounting firm had been there within the previous six months. I was even more freaked out in Sarasota, however, because that guy shared office space with a diamond wholesaler. While I was there he was taking a shipment and it was brought in by two guys openly carrying Uzi submachine guns. When my boss called me late that afternoon and told me to drop everything I was doing and fly, immediately, back to Ohio and to be at our client’s offices in Toledo by 7AM the next morning, I was happy to hear it.
I needed to get to Toledo quickly because the meetings between my boss and the politicians had not been going well. They kept telling my boss and our client that they needed — desperately — too be able to prove to the media that everything was on the up and up and that the best way to do that was to, very publicly, send state auditors into his offices who would count coins and look at financial documents, walk out and tell everyone that everything was fine. The problem: my client really, really did not want them to do that. He told my boss to stall. My boss — may he rest in peace — probably should’ve just quit right there, but he did, in fact, stall. He stalled while I was in Philly and stalled while I was in Sarasota, but he could not stall any longer. The state told him, in no uncertain terms, that auditors would be on-site in Toledo at 9AM the following morning.
I got the last flight out of Tampa to Columbus, was home just before midnight and got a horrible night’s sleep before leaving at 5AM to be up in Toledo at 7. I parked at the coin shop, which was in an office park next to the freeway. A woman opened the front door and frantically waved at me to come inside, and fast. She was extremely agitated. As I walked in she scanned the parking lot and the field between it and the freeway as if she expected an invading horde.
“Did you see anyone out there?” the woman, who was our client’s office manager, asked me.
“Um, no?” I was confused. Who would I possibly be seeing?
“They were there the last two days,” she said. “They had cameras. They were watching people come and go. I don’t know if there were cops or what.”
I told her that they were probably reporters, actually, as the Blade and Ohio’s other papers had been been tipped off that my boss and my client were in Columbus talking to people from the governor’s office and had been writing a lot about the matter in the past couple of days. Since my client was, quite prominently, making himself seen down there, I presumed the heat would be down there, not here, but you never know. I had had no small number of cases that had gotten media attention by then and knew how to deal with reporters (i.e. you mostly can’t, so don’t worry about it) and I told the office manager things were under control.
It didn’t really calm her down, and I soon realized why when she handed me a very small slip of paper.
“Here’s the coin inventory,” she said. It had, like, 100 coins listed and maybe another 100 pieces of memorabilia on it.
“That’s it?!” I said. Based on the documents given to the state and the last private audit from a few months back, there should’ve been at least a thousand things on it. Maybe more.
“That’s what’s actually here,” she said.
“Are you saying that there are two sets of books? One with what you’re supposed to have and one with that’s actually here?!” I said. Before she said anything I immediately said “Wait, do NOT answer that question. I really don’t want to hear you say it.” I took the paper from her, thinking that it might very well be evidence now. I called my boss to tell him about this GIGANTIC red flag that just went up, but he didn’t answer. The auditors were supposed to be there in less than two hours.
I began looking around the office myself, using the much larger inventory list I, and the state, had been given. I still did not really understand what the hell I was looking at when it came to rare coins but I know sports memorabilia very well and maybe a quarter of it was actually on-site. Back in the big storage room the Mickey Mantle bat was just sitting out, not in a case or anything. As I tried to figure out what I was going to tell the people from the auditor’s office, I put on a pair of latex gloves I found in the bathroom, picked up the bat and took some practice hacks with the Emancipation Proclamation banner as a batter’s eye. It was easily the highlight of my day.
My boss called me just before 8:30. I told him what was up. He didn’t sound surprised, which made me realize why he and the client were stalling so much. He told me to put the short, actual inventory list in my briefcase — it was privileged information for now but, yeah, was going to be evidence at some point, so we had a duty to preserve it. He told me that when the auditors showed up that I was to tell them NOT to use the long inventory list they had, as we now had reason to believe it was “incomplete.” They were allowed full access to catalog everything that was there but I was to say no more to them. I was to merely observe as a representative of the client and the business.
When the auditors get there — the woman in charge and six assistants — I greet them and show them around and then I go sit at a desk in the corner, open my laptop up and start playing solitaire while keeping an ear on them in case they say something noteworthy. They go about their business as if it’s just any other day and any other audit. Like me, they’ve all been sent there by more important people down in Columbus. We engage in a little small talk. They’ve been through this kind of thing a million times before. Sometimes they’re reviewing financial records at a bank that has had trouble. Sometimes they’re counting cans of food at a school where someone was stealing the lunch money. Now it’s rare coins. They don’t care, they just count.
I make notes on my legal pad to make them think I’m doing something too, but I’m just doodling. But I keep watching the lead auditor — the woman in charge of the team — walking back and forth to the front door and looking out. Maybe the reporters came back after I came in and she’s watching them like the office manager had been for the past two days.
After two hours of this I catch myself nodding off. I switch from solitaire to minesweeper. The woman from the auditor’s office goes to the door one more time. Then her phone rings. She takes the call, says “uh huh, OK, thanks.” It doesn’t seem like a consequential call, but after she hangs up she nods at one of her coworkers who nods at another and soon all six of them put their notepads down on the table, stand up and quickly move to the back wall of the room. They just stand there.
A few seconds later the front door is kicked open by a large man in a suit, tie and sunglasses with one hand holding a badge in front of him, the other hand resting on the handle of a gun in a holster attached to his belt.
“SEARCH WARRANT!”
A second after he yells that no fewer than twenty state troopers, in uniform, pour into the office and quickly fan out through the place.
My first impulse is to get down on the floor so I don’t get shot, but I realize no one has their guns drawn. Even now, 15 years later, I’m surprised that I had the presence of mind to shut my laptop, jam it and all my papers in my bag and throw the bag over my shoulder so it would be clear that they are mine, the attorney’s, and would not be mistaken for office property — now evidence — taken and thrown in a police van.
The lead investigator was standing by the door so I started walking over to him to identify myself. Before I could get to him, the office manager, who had been reading a book at her desk for the past two hours, walked quickly over to me, shoved a manilla envelope into my chest, and said, “take this and put it in your bag.” I do so without thinking, while simultaneously noticing that the investigator was not paying attention. Then my attention is taken by one of the uniformed troopers.
“Sir, everything in this office is subject to the warrant. Give me your bag.”
I am not giving him my bag, but I was also still in enough of a state of shock that the right lawyer words to express that very defensible proposition were hard to find. I auto-piloted to every cop show I’ve ever watched. “Let me see that warrant, officer,” I said.
I had no idea what I was looking at. I’m a business litigator, not Perry Mason. I pretend to read it closely while trying to get my wits about me. I finally gain a little composure and rattle off a bunch of things about who owns what, attorney-client privilege, and stuff like that. The troopers look at each other and don’t know what to do. They finally have a conference with the lead investigator, who told them to leave me alone. He then came over to me and told me to stay out of everyone’s way.
I called my boss, but he didn’t answer. I stand in a corner and watch the troopers riffling through everything. The office manager doesn’t know what to do with herself so she’s standing next to me. One of the troopers knocks the Emancipation Proclamation banner off the hook it’s hanging on and it falls onto the floor. He doesn’t notice it. Then he walks on it like it’s a rug. “Oh for fuck’s sake,” the office manager yells. “You just walked on a goddamn piece of history!” The trooper ignores her.
My boss calls back and tells me that he knows what’s going on down there (gee, Bill, thanks for telling me), and that I can leave. There is nothing else for me to do today.
I walk outside and there are four TV news trucks, cameras and reporters. There’s a helicopter overhead. The state Inspector General — who has had nothing to do with this case at all to date and who is not in charge of state auditors — is standing in front of the cameras saying things about “the public trust” and how he’s getting to the bottom of all of this. I had worked on several matters with the Inspector General before. We know each other. I decided to hang around until he was done grandstanding and ask him what the hell was going on. When he’s done with the reporters he turns, recognizes me, and begins to walk over. I figure we’re going to have a conversation, but a camera follows him and he’s still in “on” mode.
“Mr. Calcaterra, I’m Tom Charles (I know that, and he usually calls me “Craig,”), and this office is now under the control of my office and the State Highway Patrol.” Tell me something I don’t know, Tom. He hands me his card, as if I didn’t have it already, and says, “we will be talking again soon.” Don’t ever let anyone you love get in front of a TV camera. It makes them crazy.
I got to my car and remembered the manilla envelope the office manager shoved into my chest. I get it out of my bag and open it up. It has my client’s passport, two of his credit cards, and a wad of cash in it. It’s definitely the sort of thing I’d want if I was gonna, I dunno, go someplace quickly.
I drove home wondering what in the hell my life was.
My client was Tom Noe, and for the next year and a half, my life would be consumed with his criminal defense in what came to be known as the “Coingate” scandal. I’d spend an immense amount of time with him, staying at his mansion in Florida and helping him prepare his defense while he was out on bail. I’d make more trips to interview sketchy coin and memorabilia dealers and I paid two more visits to my friends with the Uzis down in Sarasota. In the middle of all of this my son was born and my daughter grew from baby to toddler and, just about, to preschooler. Now, with the passage of time, I can separate out the personal moments and the important moments from all of that, but at the time it was a giant blur.
A year and a half after the raid, Tom Noe would be convicted on multiple criminal counts arising out of his, basically, taking the state’s $50 million, using it for himself and his personal business, and then faking coin and memorabilia sales and telling auditors it was all going great. In the interim he was also convicted on unrelated federal campaign finance charges for giving his own money to his employees and friends and having them donate it to George W. Bush’s reelection campaign in order to make himself look like an important “bundler” which would give him better access to the powerful. Which it did. He got to meet the Pope once, among other things. Money makes the world go round.
When it was all said and done, Noe was sentenced to 18 years in prison. He went inside in late 2006. Note: I gave the passport, the credit cards and the cash to the country prosecutor. Noe never attempted to flee the country, even if my now deceased boss would privately tell us that, actually, that may have been his best move.
Noe’s conviction and all of the insanity that surrounded it led to some gigantic political fallout. The scandal ensnared then-governor Bob Taft, causing him to be criminally convicted for not disclosing gifts and golf outings and things he received from Noe. Outings which, I’m pretty sure, had a lot to do with him getting a sweet $50 million state contract to begin with, though investigators didn’t really bother to look into any of that given how tidy a fall guy Tom was for everything.
The scandal also led to the election of a Democratic governor, Ted Strickland in 2006, who probably wouldn’t have won otherwise. It was a pretty big deal. It also led to a Democratic Attorney General named Mark Dann rising to prominence due to his demagoguing of the Noe case. Dann’s rising star inflated his ego which, I’m guessing, is part of what led to a massive sexual harassment scandal that caused him to resign in disgrace in May of 2008. This all helped me out immensely, because it meant that when my law firm fired me as the Great Recession began in late 2008, there was a brand new attorney general, Richard Cordray, just taking office with a massive incentive to bring people in from the outside. He hired me at a time when no one was finding work and it basically saved my ass. When I started at the AG’s office there were a lot of people who had been in the business of investigating Tom Noe and who knew me pretty well from the other side. They were wary of me at first but we ended up having a pretty big laugh about it all.
Because of Ohio’s truth-in-sentencing laws, Noe was not eligible for parole or much if anything in the way of sentence reduction, and multiple clemency petitions have been denied over the years. His release date was set for late 2024. Tom will be getting out soon, though, because yesterday Governor DeWine commuted his sentence as a result of the pandemic. The story — from the Blade — tries to make that into a scandal, but it’s not. For one thing, Tom — however guilty he was, and he most certainly was — was given a sentence about three times longer than anyone had ever been given for his sort of crime in the history of Ohio. It was massively out of line with most cases, and that had a lot to do with the political considerations that surrounded it.
It’s also the case that Noe is a non-violent offender. He’s 65 years-old. He has asthma and had pneumonia a couple of years back. He’s a textbook example of a high-risk person in the COVID-19 age. He’s never getting close to anything approaching the public trust again. He’s not a threat and not a risk. It makes a lot of sense for him to be set free, and I’d be saying that even if he hadn’t been my client. I’d be saying that even if, as I’ve mentioned in the past, I didn’t come to sort of like the guy.
I’ve been sitting on that search warrant story for years. I feel better for having finally written about it. What in the hell does it say about the time we’re living in that the story of a $50 million embezzlement and my unsuccessful defense of it leading to a guy spending 14 years in the clink has made me feel better than anything has in a long time?
