Former Alaska businessman charged in corruption investigation

Former Alaska businessman charged in corruption investigation

Posted: Tuesday, August 12, 2008

ANCHORAGE - A Montana man who once owned Alaska's only network of privately run halfway houses has been charged with conspiracy in U.S. District Court.

Al Grillo / The Associated Press
Al Grillo / The Associated Press

Federal prosecutors allege Bill Weimar funneled money to a consultant for an unnamed state Senate candidate for the candidate's support for a private prison project.

Weimar was charged Monday with conspiracy to commit mail and wire fraud, and structuring financial transactions - an effort to evade laws that require reporting of large withdrawals from bank accounts.

Prosecutors allege that he paid the consultant about $20,000 in expenses in August 2004 and that the payments were not reported or routed through the campaign.

He pleaded guilty to the two counts Monday as part of an agreement with prosecutors. Sentencing was set for Oct. 29.

According to court papers filed Monday, Weimar had an agreement with the candidate that if elected to the Alaska Legislature, he would use his official position to further Weimar's business interests, including a $5.5 million stake in a private prison project.

Weimar would only receive that money if the private prison was built, and that required legislative approval.

But on Aug. 18, 2004, Weimar was told by the candidate's campaign office that their funding was depleted, according to court papers.

Prosecutors allege that Weimar arranged with the consultant that he would pay the outstanding bill, about $20,000.

"I need you to send me a bill for $3,000 for campaign, er ... for poll analysis ... on the initial deal ... And then, the rest of this what I am going to do is I'm going to send you cash. ... Two separate payments of $8,500 each and one of those I will get out today," according to the court papers detailing an Aug. 23, 2004, conversation between Weimar and the out-of-state consulting company, quoting Weimar.

The court documents do not indicate if a wiretap was used. However, if it was, it would have been a year before federal investigators used wiretaps involving VECO Corp. executives, key to many of the indictments brought in the corruption probe.

The government alleges Weimar then called the candidate and said he would not receive any further bills from the consultant. Then, court papers say, Weimar sent by U.S. mail, three packages or letters to the consultant, each containing a portion of the outstanding debt.

The government also alleges Weimar cashed two $8,500 checks at First Citizens Bank in Polson, Mont., on Aug. 23 and Aug. 24. Both were drawn on Alaska USA Federal Credit Union and were made out to him. The government also says Weimar drafted and mailed a $3,000 check, drawn on the Alaska USA account and made payable to the consultant.

The private prison company is not named, but for years Cornell Corrections Inc. attempted to build a prison in various Alaska communities. It was never built.

Weimar, though his company Allvest Inc., sold five Alaska halfway houses to Cornell Corrections for $20 million in 1998 while planning for a private prison in Delta Junction in 1998.

Weimar, who now lives in Big Arm, Mont., is the 11th person charged in the ongoing federal corruption probe.



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