In Ohio, scandal grows over lost coins

COLUMBUS, Ohio -- The director of Ohio's workers' compensation bureau resigned under pressure yesterday over the disappearance of at least $10 million worth of rare coins that the agency had bought as an investment.

Governor Bob Taft announced the departure of James Conrad, once hailed as state government's ''Mr. Fixit" for his ability to overhaul troubled agencies.

''I am outraged, I am angered, I am saddened, and I am sickened," Taft said of the scandal.

The announcement came a day after it was learned that $10 million to $12 million of the state's $55 million rare coin investment was believed to be missing -- dramatically more than the previous estimate of $400,000.

State officials said they plan to sue the man hired to manage the coin investments, coin dealer Tom Noe, and seek criminal charges. Noe has resigned, and a judge has ordered possession of the remaining coins transferred to the state.

In a statement, Conrad said he would leave office next Friday because the furor was interfering with the agency's job of helping employers and injured workers.

''The last thing I want to do is distract from the outstanding progress we have made together over the years," he said.

Ohio's workers' compensation bureau began buying and selling rare coins in the late 1990s as a way to hedge its investments in stocks and bonds. Coin dealers said they know of no other state that invests in rare coins or other collectibles, and warned that such investments can be risky.

The governor said neither Conrad nor any member of his staff told Taft about the state's investment in coins, and he did not learn about it until he read it in The Blade of Toledo last month.

He said that agency officials assured him at the time that the investment was profitable and safe.

At the bureau, Conrad had been credited with overhauling an agency that former governor George Voinovich once dubbed ''the silent killer of jobs" because of the high premiums paid by Ohio employers.

Before the new estimate on the number of missing coins, officials had said the state rare-coin investments had done better at times than the stock market, clearing a profit of nearly 40 percent, less Noe's commission.

Among the agency's purchases were a 1792 silver piece worth about $2 million and gold coins minted in 1845 and 1855.