Interesting Article Referencing Heritage Auction House

[esquirecomics]

Rare-coin odyssey put Noe in contact with mix of dealers

FTC allegations and other probes have beset some former associates

 

By CHRISTOPHER D. KIRKPATRICK

TOLEDA BLADE (OHIO) STAFF WRITER

 

MIAMI - Tucked in a corner on the second-story of a strip mall, Marty Haber plies his rare-coin and collectibles trade.

 

A row of glass cases and a few cardboard boxes full of old comic books take up most of the browsing space inside the store just off of U.S. 1. In Key Largo, a few hours from Mr. Haber's South Dixie Rare Coins shop, Toledo's Tom Noe has a multistory home on a piece of land that juts into the ocean. To see the front door requires an invitation, binoculars, or a boat.

 

The property is one of several Mr. Noe and wife Bernadette have owned as part of a rare-coin empire he began building since the early days in the 1970s when he worked in Miami with Mr. Haber. The two have taken different paths since then - Mr. Haber does not seem to need the glitz and the power.

 

"I like my store. It's nice. It's comfortable. I love coins. I've always loved coins," he said.

 

Instead of settling into a small business, Mr. Noe would rise to a place of importance and power in Ohio politics. He would golf with the governor, be appointed to the Ohio Turnpike Commission and serve as its chairman, and become a member of the Ohio Board of Regents.

 

In the few years before Miami, Mr. Noe first took a job in New England, where he worked under James Halperin, his rare-coin mentor and now an owner of Heritage Galleries & Auctioneer in Dallas. Mr Halperin agreed in 1990 to settle a claim for $1.5 million that involved a Federal Trade Commission investigation of a rare-coin company.

 

Mr. Noe left New England in the 1970s and then left Miami at the turn of that decade to open his Monclova Township store, Vintage Coins & Collectibles.

 

During his journey down U.S. 1, from Halperin-to-Haber, and then back home again, Mr. Noe nurtured his rare-coin standing, often among a cast of rare-coin characters who have had some black marks on their records.

 

One was a felon and several others, such as Mr. Halperin, would pay FTC settlements. Several of the dealers who have black marks or are being investigated were involved with handling the Ohio Bureau of Workers' Compensation's $50 million investment it made in rare coins with Mr. Noe.

 

For years, some of these dealers have orbited like moons around Mr. Noe, who, starting in 1998, developed the gravitational pull of tens of millions in state investment dollars. The dealers have been part of the decades-long context of his rare-coin life that brought him to political prominence through his prodigious political giving and GOP fund-raising.

 

Mr. Noe's lawyers now say the rare-coin funds, which were confiscated by the state, are missing at least $13 million, and several agencies are investigating Mr. Noe. The lawyers say he has done nothing wrong.

 

Mr. Haber, who would not talk about Mr. Noe, characterized the rare-coin industry as one open to abuses and charlatans.

 

"When you are dealing with something not precisely definable, it obviously opens itself up to potential abuses, like the telemarketers of years ago," he said. "They would call up people cold and they would offer them rare-coin investments, and they would tout the investments and potential returns and would sell them misrepresented items."

Colorful backgrounds

 

 

One of the hallmarks of the rare-coin industry, according to coin expert and author Scott Travers and others, such as Coin World editor Beth Deisher, is its repleteness of rogue risk-takers. Where there is big money to be made, there will always be riverboat gamblers, Ms. Deisher said.

 

"The overall market is very, very strong. They are certainly commanding prices we've never seen before, and there are some participants that have rather colorful backgrounds, to say the least," she said. "But buyers and sellers go to the heart of the material. If a coin is especially rare, they don't necessarily care about who is selling it."

 

Some with black marks have said they were young and foolish. Others said they were wrongly targeted by an overzealous FTC, which investigates advertising claims as part of the federal Bureau of Consumer Protection.

 

Among those in Mr. Noe's circle are:

 

Richard Melamed, who helped run one of Mr. Noe's subsidiaries in Colorado with state of Ohio money. He paid $10,000 to settle FTC charges in 1993.

 

Mark Chrans, who ran a subsidiary in California for Mr. Noe with state of Ohio money. He was convicted in 1986 on federal charges related to the laundering of drug money through his rare-coin business.

 

Kevin Lipton, who, along with Mr. Halperin, also settled the FTC case for $1.3 million. Mr. Lipton did not want to fight the federal government and opted to settle, he said. Mr. Lipton in 2003 became involved in a state of Ohio coin deal with Michael Storeim, who was one of Mr. Noe's subsidiary managers in Colorado and is now under investigation by authorities there over two missing coins worth $300,000. Mr. Lipton said he regrets getting involved with Mr. Storeim.

 

Under similar scenarios, a stock broker or lawyer might lose his or her license. But in rare coins, there isn't a license to lose, no test to pass.

 

Still, Congress recently explored rare coins as an acceptable investment for retirement dollars. The Ohio General Assembly approved rare coins as an acceptable investment for pension funds and other government funds, such as a portion of the Bureau of Workers' Compensation's $14.3 billion fund to pay injured workers' medical expenses.

 

"You are going to see individuals whose backgrounds correspond to an easy-entry field. There's no government regulation or government restriction against someone trading if they have a judgment against them," Mr. Travers said.

 

Despite its "wild west" aspects, the rare-coin industry has its self-policing aspect too, Mr. Travers pointed out. The Professional Numismatists Guild bars membership to felons and requires extensive background checks for potential members. The guild kicks out those who run afoul of the law or mistreat rare-coin customers. And guild members must agree to arbitration to settle disputes.

 

Mr. Noe resigned from the group on May 26.

Tom Noe: The early years

 

 

The rare-coin education of Tom Noe began in Bowling Green in the late 1960s and early 1970s.

 

After high school tennis practice, he would drive his Toyota to work at a rare-coin shop in Toledo, his tennis coach, Michael Watkins, recalled. He remembered the young Noe as a perfectionist on and off the tennis court, an independent person who took care of himself and would help others who forgot their lunch money, for example. He would befriend those who didn't seem to have many friends. Mr. Watkins, who also directed him in the high school's production of the musical Carousel, admired him, he said.

 

"I kind of liked him because I thought he was an independent man who took charge. I had a very positive opinion," he said. "I thought he could handle that kind of coin stuff. It takes a little bit of knowledge to do it. It was unusual at the time."

 

Mr. Noe attended Bowling Green State University but only for a year.

 

Another high school teacher, Brian Tucker, said his former student had a leadership quality and a wide independent streak.

 

"I think he was one of those kind of guys who wanted to show that he didn't need to go to college to be successful," the history teacher said. "It's that initiative thing. He wanted to tell himself what to do - he didn't want anyone else to tell him what to do."

 

Among his first jobs was with Mr. Halperin at New England Rare Coin Galleries. Mr. Noe was energetic and honest, Mr. Halperin said.

 

"He worked for me a long time ago. When he got to New England he was very energetic, very well-liked, and smart," he said. "I'm heartbroken, absolutely heartbroken [over the scandal]."

 

Mr. Halperin, now a rare-coin giant who owns the mammoth Heritage Galleries & Auctioneer in Dallas, regrets settling the FTC case, saying the federal agency was too aggressive and that his firm did not do anything wrong. He was simply a supplier for his former company, New England Rare Coin Galleries, which was the main target of the federal probe. He had sold it to Dana Willis and Paul Taglione, he said. Also known as Standard Financial Management Corp., New England Rare Coin Galleries folded its tent after the FTC finding of deceptive practices against it.

 

The company liquidated its assets and paid $1.5 million. Mr. Halperin settled for $1.5 million, and Mr. Lipton settled for $1.3 million.

 

The FTC's Reilly Dolan, who is the assistant director for enforcement, said strong cases existed against Mr. Halperin and Mr. Lipton.

 

"We sued both of them, and the cases were settled," he said.

 

The case was a landmark one for the rare-coin industry, forcing it to come up with a formalized system of grading that could be verified from coin to coin.

 

"In dealing with the government, there's no winning. Sometimes you have to say, 'OK, we'll move on.' It has zero to do with what's going on here [with Mr. Noe] at all," Mr. Lipton said.

 

The Beverly Hills, Calif., coin dealer became tangentially involved with the state of Ohio's investment by providing insurance coverage and potential high-end customers for four rare U.S. gold coins that Mr. Storeim purchased with state of Ohio money as part of its investment with Mr. Noe.

 

Mr. Storeim ran Numismatic Professionals Limited in Evergreen, Colo., which served as one of several subsidiaries set up by Mr. Noe to buy and sell coins. Two of the four coins went missing on Oct. 27, 2003, from an Express Mail package on its way back from a grading firm, Mr. Storeim told Colorado police.

 

The rare coins, an 1845 $10 Coronet gold eagle and an 1855 $3 Indian Head gold coin, were valued at $300,000. Mr. Lipton's insurance premiums and legal fees have been piling up since, he said.

 

"I'm still in limbo," he said about the missing coins.

 

Mr. Storeim has said, through his attorney, that he committed no wrongdoing. But his former colleagues have said they believe he may be involved, police records show.

 

Mr. Melamed, who worked at the Noe operation in Colorado, himself paid a $10,000 settlement in 1993 to the FTC.

 

The agency report said that Mr. Melamed's company, Melamed Rare Coins, agreed to the settlement after the firm was accused of helping a Minnesota coin dealer commit fraud against the government. Mr. Melamed was accused of helping the dealer avoid paying an $11.2 million FTC judgment. At the time, Mr. Melamed denied the accusations but agreed to pay. He has declined to comment to The Blade about his role in the state of Ohio's investment.

 

Chrans, who was hired by Mr. Noe to buy and sell rare coins for the state of Ohio, has a felony record from two 1986 convictions related to laundering drug money through his rare-coin business.

 

In 1998, after Mr. Noe received the first $25 million from the Ohio Bureau of Workers' Compensation to invest, Mr. Noe set up Capital Coin out of his Monclova Township shop. He then set up several subsidiaries with Ohio money, including the Colorado subsidiary run by Mr. Storeim.

 

Another was Visionary Rare Coin in California. Mr. Noe hired Chrans to run it. And to jump-start the operation, he allowed Chrans to draw $25,000 a month in state money against the anticipated profits from rare-coin deals. Mr. Noe told The Blade in April he didn't know Chrans was convicted of two federal felonies in Illinois and spent time in a federal penitentiary.

 

The future coin sales Mr. Noe and Chrans had counted on to pay for the venture did not come through, and Mr. Noe cut Chrans off in late 1999 after two consecutive months of poor performance. Mr. Noe wrote off $850,000 in bad debt when Chrans failed to repay a $250,000 loan and advances made to him with the state's money.

A new grading system

 

 

The FTC case involving Mr. Halperin and Mr. Lipton was a watershed moment for the industry because it changed how companies could market rare coins.

 

Mr. Halperin sold New England Rare Coin Galleries, where he had been Mr. Noe's boss, to Mr. Willis and Mr. Taglione. But Mr. Halperin and Mr. Lipton supplied the firm with coins, which were then marketed by New England, the two said. Their names are forever linked with the landmark ruling that had the effect of formalizing a set of criteria for grading coins.

 

Grades used to be listed on cards that had a picture of the coin. The cards and coins could be switched and fraud perpetrated. Because of the FTC lawsuits and settlement, the industry now uses plastic cases with bar codes and grades listed. They cannot be pulled apart without shattering.

 

"That was kind of the wake- up call on grading," Ms. Deisher said. "These grading companies have spent lots of money to keep those from being tampered with. A couple of people have tried to counterfeit them. The case did bring about a number of changes in the marketplace."

 

Mr. Lipton said the rare-coin industry has been good to him and that the FTC case, which he says is generally misunderstood because he really settled a civil suit and was not cited by the FTC, occasionally shines an unwelcome light on him. The case of the missing coins has had the same uncomfortable effect, he said.

 

"I have no problem with the FTC. I think they are there to protect the consumer and generally, they only get involved when there is gross negligence," he said. "I think every industry has bumps and bruises that deal in large sums of money, whether it's stocks, bonds, and banking. The overall strength of what you do [is what matters]. I have a great deal of respect for our industry, and it's been wonderful for me since I have been a kid."

 

Mr. Halperin said the FTC did clean up many elements of the rare-coin business. But like Mr. Lipton, he said the case against him was trumped up because his company did not engage in deceptive advertising and only supplied coins.

 

"The FTC went after the coin business in the late 1980s probably for very good reason, there were a lot of bad apples, and we all did business with them," Mr. Halperin said. "Now, it's much better. The margins are much smaller. As a result of the FTC action, the coin business is a much better place."

 

Contact Christopher D. Kirkpatrick at: ckirkpatrick@theblade.com or 419-724-6077.

[metropoliscomics]

Interesting stuff.

 

Haven't thought about Marty Haber in years. I am surprised he is not in jail. One of the biggest criminals EVER to darken the doorstep of the comic book market.

 

Stephen

[Aman619]

tell us about Marty's comics capers.

[metropoliscomics]

Put it this way:

 

Danny Dupcak was shocked! SHOCKED! at some of the things that Marty Haber was able to get way with. Call it criminal envy.

 

S

[Aman619]

I never heard of him before.... or at least cant place the name, so I was hoping for a story that would jog my memory.

[Nostalgic Attic]

Put it this way:

 

Danny Dupcak was shocked! SHOCKED! at some of the things that Marty Haber was able to get way with. Call it criminal envy.

 

S

 

Is there an article you can point us to? I didn't get anything when I googled.

[greggy]

First thing out of my google search

 

 

 

U.S. Department of Justice

 

R. Alexander Acosta

United States Attorney for the

Southern District of Florida

 

99 N.E. 4 Street

Miami, FL 33132

(305) 961-9001

June 6, 2006

PRESS RELEASE :

 

FOR IMMEDIATE RELEASE

 

For Information Contact Public Affairs

Yovanny Lopez, Public Affairs Specialist, (305) 961-9316

 

June 13, 2006

 

FORMER FLORIDA LAWYER CONVICTED OF EBAY FRAUD

 

R. Alexander Acosta, United States Attorney for the Southern District of Florida, and Jonathan I. Solomon, Special Agent in Charge, Federal Bureau of Investigation, announced today that defendant Martin Eugene Haber has entered a guilty plea to more than $400,000 in mail and wire fraud.

 

Haber, 58, a former attorney, was the owner and operator of South Dixie Rare Coins, located in Miami. Haber sold collectibles and rare coins through eBay, an Internet auction site. At sentencing, Haber faces a statutory maximum of twenty (20) years for each of the six (6) counts of wire fraud and one (1) count of mail fraud, fines of up to $250,000, and can be ordered to make full restitution to the victims. Sentencing is scheduled for August 22, 2006, before U.S. District Court Judge Donald L. Graham.

 

This investigation began after the Internet Fraud Complaint Center received more than 50 complaints from buyers who did not receive the merchandise they purchased on eBay from Haber. An additional 50 complaints were reported by unsatisfied buyers with the Consumer Sentinel and local police departments. Over all, more than 188 complaints were made for merchandise purchased between May, 2001, to January, 2005, representing a loss of more than $400,000. Despite two arrests by local law enforcement for these same activities, Haber continued to sell items on the Internet using a variety of names, including those of his family and friends.

 

The FBI investigation revealed that Haber used eBay accounts belonging to friends, family members, and business associates to sell coins on the Internet. Haber often assumed the identity of an actual eBay account holder to hide his true identity from the potential buyers. Many of the eBay accounts Haber used were suspended due to buyer complaints. Haber continued to sell coins on the Internet until search warrants were executed at his home and place of business.

 

The evidence linked complaints against Haber with the following eBay accounts: coins and currency, registered to Martin Haber and Tillie T. Arenson Haber , 8610 SW 64th Avenue, Miami, Florida, e-mail address naska2003@aol.com; hgh-for-collectors, registered to Heather G. Haber (Martin Haber's daughter), 211 1st Avenue #3, New York, New York, e-mail address hghcollectibles@aol.com; southdix, registered to Leslie B. Lundstrom, 12265 South Dixie Highway, Miami, Florida, e-mail address southdix1@hotmail.com;mailto:dlst@hiyawatha.com antiquetymes, registered to Mary L. Garcia, 7701 Old Cutler Road, Coral Gables, Florida, e-mail address antiquetyme@aol.com; greeneagle47, registered to Diana M. Harper, 19751 Sterling Drive, Cutler Ridge, Florida, e-mail address oldcutler1@aol.com; keybrickell, registered to Christopher Di Pietro, 801 Brickell Key Boulevard #2611, Miami, Florida, e-mail address TTA1948@aol.com; naskamom2004, registered to Toni Arenson (an alias for Tillie T. Arenson Haber), 14115 South Dixie Highway #L, Miami, Florida, e-mail address naskamom@aol.com; and otcollectibles, registered to Sebastien Taggart, 5651 SW 76th Street #4, Miami, Florida, e-mail address otcollectibles@aol.com.

 

Mr. Acosta commended the investigative efforts of the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Wilfredo Fernandez.

 

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls <http://www.usdoj.gov/usao/fls>. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov <http://www.flsd.uscourts.gov> or on <http://pacer.flsd.uscourts.gov>.

[Davenport]

If you Google "Doing Business with Marty Haber" in quotes it'll pull up one hit... South Dixie Rare Coin.

The April '06 blog is no more, so you have to click Google's "Cached" Supplemental Result link to read it.

Interesting, especially the "Amazing Registered Mail Trick" part.

[GACollectibles]

I recognize the seller ID "greeneagle47", though fortunately never purchased anything.

[steelhelmet]

I'm really sorry to hear this about Mr. Haber as I had a good transaction with him when he was known as SMRC comics ( I sold him some Gaines EC's). This was in '95 or '96.My whole impression was very positive.And remember, he did have some good books back then.

[tth2]

Interesting stuff.

 

Haven't thought about Marty Haber in years. I am surprised he is not in jail. One of the biggest criminals EVER to darken the doorstep of the comic book market.

 

Stephen

I bought some books from Marty off eBay in the late 90s. He overgraded, but thankfully all of them came back clean.