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BWC Lost $4M in Convict's Fund, Wine Stolen"
By George NelsonCOLUMBUS -- Bad news keeps mounting for the Ohio Bureau of Workers Compensation. The latest revelations include news that the state lost nearly $4 million on an investment placed with a New York money manager now in federal prison, and that more than $300,000 worth of vintage wine may have been purchased with funds stolen from the state."We should require that the bureau Google each investment manager once a month to see whether or not they've been indicted," said state Sen. Marc Dann of Liberty. "And I'm also going to get the new administrator a subscription to The Wall Street Journal -- and The Business Journal."Dann, one of the most vocal critics of BWC's investments, was responding to reports that BWC had maintained a $50 million investment with Alan Brian Bond, a money manager with Albriond Capital Management, for more than 18 months after he had been indicted on charges of taking kickbacks. "This is a well-known problem that this investment manager had and we were the last people to take our money away from his control," Dann chided.According to the Associated Press, Bond was indicted in December 1999 on charges of taking $6.9 million in kickbacks that were billed to his clients. He pleaded guilty to the charges. The BWC's chief investment officer at the time told The Plain Dealer that the agency would keep its money with Albriond despite the charges. However, BWC spokeswoman Emily Hicks said bureau officials didn't know about Bond's legal troubles until he was indicted on a separate set of charges in December 2001. A jury convicted him in that a case. He is serving a 12-year federal prison term. BWC had initially invested $80 million with Bond, but Dann said at some point it became more than an appropriate percentage of his total investment pool so BWC pared back the investment to $50 million. "Now they didn't follow that policy, of course, with the MDL investment," he added. "The policy existed. It just wasn't followed in that case." The bureau withdrew the rest of its money invested with Albriond for a loss of $3.86 million. MDL Capital management in Pittsburgh had managed a $350 million fund for BWC but lost $215 million of the state's money. Attorney General Jim Petro announced Friday that he is suing MDL, claiming the company made prohibited investments. Barry Slotnick, an attorney representing MDL, denied the allegations, describing the Ohio lawsuit as a case of "investor's remorse," according to The Blade in Toledo.The new investment loss is the latest embarrassment for the Bureau of Workers Compensation since reports began surfacing in early April about BWC investing more than $50 million with Cleveland coin dealer Thomas Noe. After the unusual investment was revealed, an investigation showed at least $10 million of that investment is missing. In that case's newest twist, The Blade reported today that the suburban Denver home of a former Noe employee, Michael Storeim, was burglarized over the weekend, with thieves making off with $300,000 in wine possibly purchased with BWC money, as well as artwork, guns, jewelry and cars."What a coincidence, huh?" Dann responded sardonically. "It's just truly amazing."Though other property suspected of being purchased with missing BWC funds was taken into custody, Dann said authorities weren't sure they could safely handle the wine so they changed the locks on the wine cabinets at Storeim's home. Though he didn't have the keys to the new locks, Storeim was permitted access to the home."They tried to secure it there because if you take it to some evidence locker someplace you don't take care of wine, I understand it might lose it's value," Dann explained. "But this is just beyond coincidence."MORE ON BWC Scandals: www.toledoblade.com"