Ex-workers’ comp official testifies in fraud trial

The probe into corruption at the Ohio workers’ comp bureau continues.

AKRON (AP) — The former chief financial officer of the state agency for injured workers testified Wednesday that he received cash and a job offer in return for supporting a high-risk hedge fund that lost $215 million of the agency’s money.

Terrence Gasper, testifying at the federal fraud trial of Mark Lay, chief executive and founder of MDL Capital Management of Pittsburgh, said the money and offer of lifetime employment came from Patrick White, president of the former Great Lakes Capital Partners in Westlake.

“Sounds like a bribe to me,” Richard Kerger, one of Lay’s defense attorneys, said to Gasper on the stand.

“Sounds like a bribe to me,” Gasper replied.

White has not been charged. His attorney, Mark Stanton, declined to comment.

The state investigation into corruption involving Bureau of Workers’ Compensation investments continues, Inspector General Thomas P. Charles said. He did not rule out action against White.

“The trial of Mark Lay is the priority,” Charles 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 former Gov. Bob Taft.

Prosecutors say Lay lied to state officials and manipulated investments. Lay’s attorneys say he followed state guidelines and the investments were appropriate.

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. He’s now serving 18 years in prison for theft and other crimes. Nineteen people have been convicted in the scandal.

Lay’s trial was in its third day and is expected to last two weeks.

If convicted, Lay faces a maximum sentence of 20 years in prison, but would likely receive less time under federal sentencing guidelines.