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South Florida Sun-Sentinel
Tuesday, February 26, 2002

Jon Burstein Staff Writer

The two businessmen working out of a tiny Boca Raton office boasted to clients that they had the experience and reputation to pull off financing for multimillion-dollar projects.

The men known as Clif Goldstein and Paul Randall -- founders of Great American Trust Corp. -- relied on their years of deal-making experience, but their reputation wasn't for the "fiscal integrity" trumpeted in brochures, federal authorities said.

Those authorities say the two actually are brothers Clifford Dixon Noe, 71, and Paul Howe Noe, 74 -- once "con men extraordinaire" whose handiwork is the stuff of hustler legend. Earlier this month, the FBI arrested them for allegedly bilking $3,000 from a South Carolina client.

Almost four decades ago, Clifford Noe was convicted of embezzlement, mail fraud and wire fraud in Texas, a recent arrest affidavit shows. He was in and out of prison from 1965 to 1991, according to court documents, and had fraud-related convictions in four states and Great Britain. Clifford Noe changed his name to Clif Goldstein after being released from prison in 1991, the affidavit said.

The U.S. Securities and Exchange Commission began scrutinizing the Great American Trust Corp., known as GATCORP, in February 2001. It identified 25 alleged victims who said they lost more than $1.1 million. Earlier this month, the SEC filed a civil fraud lawsuit claiming the Noes and four others accepted money from businesses for a venture capital program that didn't exist.

Since the brothers' Feb. 12 arrests in connection with the South Carolina criminal case, other GATCORP clients are coming forward to federal authorities. Besides the money they said they gave to the brothers for supposed legal fees, the clients say they lost or could lose additional thousands--in at least one case, millions -- from waiting and planning for deals that never materialized.

"They didn't just steal money. They stole time, reputation and credibility,"said Steve Hard, a Salt Lake City attorney who said he gave the Noes $30,000 in hopes of getting funding for an internet company. He said his project now appears dead.

Utah developer Todd Getz said he paid $170,000 to GATCORP for legal fees but now expects to be out $8 million. He had sunk that much into plans to develop Costa Rican beachfront property as he waited for the company to coordinate a $54 million loan. Both Getz and Hard said they have contacted federal authorities since learning of the Noes' arrests, but the SEC lawsuit was filed before they did so.

Louis St. Laurent II, a former Lee County prosecutor who squared off against Paul Noe in the 1970s, understands how capital-hungry businessmen might be lured by the Noes.

"In person they are very, very convincing, unless you are an expert in fraud," said St. Laurent, who is now in private practice in Coral Springs.

The brothers, in the Palm Beach County Jail, await a Wednesday court hearing to send them to South Carolina to each face three charges related to the allegations in that state. If convicted, they could face prison sentences of up to 10 years.

Kenneth Stein, their attorney, said the Noes' history should have no bearing on the current criminal charges or on a civil fraud lawsuit that the SEC filed earlier this month.

"They are certainly innocent until proven guilty," Stein said.

A London judge once described Clifford Noe as "an international swindler on the highest level." The Wall Street Journal called him one of the top "con men" of the 1970s. During that decade, there were federal convictions for conspiracy, mail fraud and transporting forged securities, according to an arrest affidavit.

In 1988, Fortune dubbed him one of the most fascinating people of the year, the magazine saying the FBI ranked Noe among "the most notorious white-collar criminals ever."

The Noes' exploits in the 1960s and early 1970s even were detailed in a 1973 book -- The Fountain Pen Conspiracy.

The brothers' first fraud convictions came in 1965. They had bought a Texas bank and almost brought it down by manipulating millions in fraudulently obtained loans, according to the book by Jonathan Kwitny.

Clifford Noe -- who used to call himself "Dr. Noe" -- was arrested again in 1971 in England for attempting to buy a London bank with forged certificates of deposit, according to the book.

The Noes lived in style, always staying in hotels' presidential suites and eating at the finest restaurants, said St. Laurent, the former prosecutor. When federal agents arrested Paul Noe in 1972, he was in the midst of buying a Learjet, St. Laurent said.

Noe testified before Congress in 1973 on international bank and mortgage schemes, according to a recent arrest affidavit.

The affidavit said Paul Noe has served prison sentences in Florida and Texas. Clifford Noe, imprisoned as late as 1991, has been convicted of fraud-related crimes in Texas, Illinois, Alabama and Pennsylvania.

Clifford Noe -- calling himself Clif Goldstein -- moved to Boca Raton sometime in the mid-1990s, settling down in a modest $146,000 house with his wife and daughter.

Goldstein seemed like a quiet retiree, puttering around in his garden and regularly attending temple, according to neighbors.

The two brothers incorporated the Great American Trust Co., or GATCO, in South Carolina in 1984 and then registered GATCORP -- a wholly owned subsidiary of GATCO -- in Florida in April 2000, according to the SEC lawsuit. The brothers' arrest affidavit indicates the names GATCO and GATCORP often were used interchangeably.

In their GATCO brochures, they boasted that the company managed $5 billion in trust accounts and had a "staff of professional trust advisers" ready to guide customers.

The SEC alleges the brothers paid a network of financial brokers to locate potential clients: cash-strapped companies or fledging projects needing venture capital.

In interviews, GATCORP clients said they would fly into Boca Raton, where the men they knew as Randall and Goldstein presented them with plans for cash infusions. The Noes promised to provide letters of credit from a "top 10 European bank" to back up a bank loan for the needed money.

But clients also said the brothers told them they would have to pay legal fees in advance for the deal to go through. The brothers said they used a person named "M. Guter" at a Costa Rican law firm to draw up venture capital agreements, court documents state. Federal authorities have been unable to find that person, court documents indicate. In January, Paul Noe told the FBI that "M. Guter" was dead.

The deal described by the Noes only got better. According to the SEC complaint, the businesses were to give their loan money to GATCORP, which would place it in high-yield investments that would ultimately pay off the loans.

Before operating GATCORP, the Noes ran another company that offered investors returns of 100 percent per week, the SEC alleges.

Hard, the Utah attorney, said he handed over $30,000 in June to the Noes, who promised he would soon get $30 million he needed for his internet project. But GATCORP spent the next eight months coming up with ways to delay closing the deal, Hard said.

"We had management personnel we had recruited who were waiting for funding to come in," Hard said. "But after three or four months of, 'Next week this is going to close,' they had to move on."

Hard said he threatened earlier this month to report GATCORP to federal authorities if the deal wasn't sealed by Feb. 15.

But the FBI already was looking into GATCORP. In November, a South Carolina bank loan officer reported to federal authorities "an unusual financial transaction" involving a local golf-course management company's attempt to get a $200 million cash infusion with GATCORP's help.

The FBI soon uncovered the Noes' true identities and learned of the SEC inquiry.

Federal agents began taping phone conversations involving Paul Noe and two of the Noes' alleged "finders" -- Russell Gerstein of Las Vegas and Nuell Paschal of Carthage, Miss. On one of the tapes, Paul Noe told the South Carolina client that GATCORP recently handled a $125 million deal, court records state.

While FBI agents from South Carolina investigated GATCORP, Paul Noe set up a December meeting with a French Canadian client who had already plunked down $10,000 for a deal, St. Laurent told an FBI agent this month.

The client came to the meeting with his attorney -- St. Laurent. St. Laurent said he instantly recognized Noe, but Noe didn't recognize him.

St. Laurent said he listened to Noe's business plan and questioned him on it for 21/2 hours at the Friday meeting. At a meeting the next Monday, he told Noe he knew all about his past.

"I thought he was going to pass out," said St. Laurent.

Paul Noe promised to return the $10,000 to St. Laurent's client -- then asked St. Laurent to become his attorney, the former prosecutor said. St. Laurent declined and was soon talking to the FBI and SEC, according to the arrest affidavit.

Besides arresting the Noes, the FBI has gotten arrest warrants for Paschal and Gerstein. The SEC complaint names two other people -- Carolyn Kaplan and Noel Alelov -- as directing business to GATCORP. Kaplan, of Norcross, Ga., is chairman of GATCO. In 1977, she was sentenced to three years in prison for interstate transportation of falsely made securities, according to the SEC complaint. Alelov, of West Orange, N.J., is a consultant who refers investors to GATCORP's programs, SEC records said.

FBI officials have declined to comment on the case.

Getz said he might sue but doesn't expect to see his money again. Court records indicate GATCORP never kept more than $70,000 in its Florida bank account.

St. Laurent, intent on gathering more evidence, said he plans to keep a vow he once made to Paul Noe.

"I promised him 30 years ago that if he ever went back to crime, I'd make sure he went back to jail," St. Laurent said.