MSM Discovering OH BWC $215 million loss cover up before 2004 election

[OzarkDem]

The Toledo Blade reported this story some time ago, but the rest of the Ohio news media is losing the battle to ignore it.
Emails show officials conspired to keep the story about corruption and theft at the Ohio Bureau of Workers Comp covered up before the 2004 election; concerned that it would help Kerry.

http://www.cleveland.com/news/plaindealer/index.ssf?/base/news/1155641571243120.xml&coll=2

In an Oct. 27, 2004, e-mail message to the Bureau of Workers' Compensation's chief legal counsel and ethics officer, John Annarino, agency director Jim Conrad noted his worry that news would spread about the loss in a hedge-fund investment with Pittsburgh-based MDL Capital Management.

Conrad told Annarino that he and James McLean, the bureau's investment director at the time, should put on a positive face to make the agency's investment staff feel at ease if they expressed concerns.

"Jim told me this morning that he thought the major chance of us getting involved with the MDL situation is with a leak from OUR employees," Conrad wrote in the message to Annarino, The Blade of Toledo reported Sunday.

MDL founder Mark Lay alleges in court documents that bureau officials hid the loss until after the election, in which Ohioans narrowly voted for President Bush over Democratic Sen. John Kerry, giving Bush the electoral votes he needed for re-election.

The bureau is suing MDL to recoup its losses.

"State officials have left little doubt that the timing and substance of their public disclosures, as well as their entire litigation strategy, have been manipulated and planned for political purposes," Lay's attorneys wrote last month in asking a federal judge to dismiss the case.

In other messages to top aides, Conrad openly discussed his desire for Kerry to lose.

Conrad declined to comment. He was forced out of his job in 2005 amid a scandal over the bureau's $50 million investment in rare coins, which was managed by now-indicted GOP fund-raiser Tom Noe.

Even better coverage in the Toledo Blade story

http://www.toledoblade.com/apps/pbcs.dll/article?AID=/20060813/SRRARECOINS/308130012/-1/SRRARECOINS2

Other e-mails show that in October, 2004, Mr. Conrad - in the interest of concealing the MDL losses - misled the bureau's politically appointed oversight board and the agency's employees about the real reasons for the departure of Terrence Gasper, the bureau's chief financial officer. He told oversight members and agency employees that Gasper left for health reasons, when actually he had been given a choice to resign or be fired after failing to tell Mr. Conrad that he had approved a reallocation of $100 million to MDL.

The allegation that high-ranking bureau officials covered up the MDL hedge-fund loss has emerged in the state's civil lawsuit seeking to recover the $215 million investment loss. That lawsuit is pending in federal court in Columbus.

In a motion filed last month requesting that the lawsuit be dismissed, attorneys representing Mark D. Lay of MDL Capital Management accused state officials of "covering up the bureau's investments and investment losses in 2004 just before a presidential election."

"State officials have left little doubt that the timing and substance of their public disclosures, as well as their entire litigation strategy, have been manipulated and planned for political purposes," attorneys for Mr. Lay and MDL wrote in the motion. Eric Kuwana, a Washington attorney representing Mr. Lay, declined to elaborate on the allegation of a cover-up.

Chris Redfern, chairman of the Ohio Democratic Party, said last week that if the MDL losses had been revealed in October, 2004, it "would have been national news" and would have had a significant impact in Ohio, where 120,000 votes separated President Bush and John Kerry, the Democratic nominee.

[unpossibles]

1. file under: not surprising n/t

[librechik]

2. hope that lingers awhile in the public eye