Ohio: Investment scandal trial begins

Source: AP via Hemscott

AKRON, Ohio (AP) - An investment adviser for the Ohio Bureau of Workers' Compensation lied about and manipulated $215 million in state funds for injured workers, the government said Monday as his trial began.

Mark D. Lay, head of a money management firm, exceeded his investment authority by using high-risk hedge investment funds, Assistant U.S. Attorney Benita Pearson said in opening statements in U.S. District Court.

'It was not Mr. Lay's money to gamble with,' Pearson said.

Lay was indicted in June on charges of investment advisory fraud, mail fraud, and conspiracy to commit mail and wire fraud as part of an investigation into a wide-reaching bureau investment scandal that reached to the former governor.

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The indictment emerged from a case that began with the 2005 revelation that prolific Republican donor Tom Noe was investing state money in rare coins. Nineteen people have been convicted in the scandal, which rocked state politics.

More than $300 million in losses were reported at the bureau. Former Gov. Bob Taft pleaded no contest to charges that he failed to report golf outings and other gifts on his disclosure forms and was fined $4,000.

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Must run in the family.