Judge tosses Ben Stevens' fine

Posted: Sunday, May 18, 2008

ANCHORAGE - A Superior Court judge says the Alaska Public Offices Commission was wrong to find that former state Senate President Ben Stevens violated state law by failing to disclose the clients of one of his consulting firms.

On May 5, Judge Sen Tan in Anchorage threw out the $5,000 fine assessed by APOC against Stevens last year.

Stevens, a Republican, has been under investigation in the broad FBI investigation of corruption in Alaska.

Ray Metcalfe, a former state legislator, began filing a series of complaints with APOC in 2005, alleging that Stevens failed to properly disclose his private business clients and the work he did for them.

The case involving Stevens' consulting firm, Advance North, grew out of the resulting APOC investigation.

Metcalfe, a Democrat, is now running for U.S. Senate, seeking the seat held by Ben Stevens' father, Ted, a Republican.

Ben Stevens owned 50 percent of Advance North LLC from 2002 to October 2005. The other half was owned by Anchorage fisheries lobbyist Trevor McCabe, a former legislative aide to Sen. Ted Stevens.

McCabe also is under federal investigation over his sale of land to the Alaska SeaLife Center in Seward through an earmark introduced by the elder Stevens.

Ben Stevens, in his annual disclosures as a legislator, acknowledged receiving income from Advance North but didn't list his clients nor the amount they paid. The law made no such requirement, he said.

Tan noted that the issue was complicated by the nature of a limited liability company, a hybrid business structure that didn't exist in state law when APOC's disclosure laws were enacted.

The APOC investigation had found that Advance North received $392,500 between 2003 and 2005 from fishing industry clients with business before the state.

Under rules in effect at the time, the clients and their payments would have to be disclosed if Advance North was a partnership or if Stevens collected the money as an individual. Disclosure wasn't required if Advance North was a corporation, and Stevens owned 50 percent of the stock or less.

APOC had concluded that an LLC was very similar to a partnership.

Tan, however, noted that limited liability companies weren't listed in the statute that enumerated the business structures requiring full disclosure, nor had the commission attempted to extend the law to LLCs in its own regulations. Tan said Stevens had no duty to report the details of his clients.

State lawmakers have since changed disclosure law to include LLCs.

The state has not yet decided whether it will appeal Tan's decision, according to assistant attorney general Margaret Paton-Walsh.

The case was the second involving Stevens to be thrown out this year. Superior Court Judge Mark Rindner ruled in January that APOC erred when it fined Stevens $630 in 2007 for failing to disclose more than $70,000 in deferred compensation he received as a director of Semco Energy, the parent company of Anchorage natural gas utility Enstar.

The state is appealing that decision to the Alaska Supreme Court.

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