Alaska puts brakes on corruption probe

Justice Department tells state its investigation could interfere with ongoing federal effort

Posted: Wednesday, October 17, 2007

ANCHORAGE - State prosecutors will back off an investigation of election campaign polling practices to avoid interfering with an ongoing federal corruption probe, Gov. Sarah Palin announced Tuesday.

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Palin, who championed ethics reform while winning office last November, released a letter from the U.S. Department of Justice that said a state investigation could interfere with the federal effort.

"Because of the long-standing federal investigation into these matters, we believe that concurrent state investigative activity will have the effect of compromising certain aspects of the ongoing federal public corruption investigation," said Brenda K. Morris, deputy chief of the Justice Department's public integrity section.

She commented in a letter to Alaska Attorney General Talis Colberg.

Attorneys from the Public Integrity Section are prosecuting four former Alaska legislators, including Pete Kott, who was convicted of bribery and other counts last month.

State officials announced they would investigate after testimony emerged from Kott's trial that Kott and possibly others had illegally received campaign polls paid for by officials of VECO Corp., a major oil field services company that spent thousands of dollars supporting pro-development candidates.

VECO CEO Bill Allen and a company vice president, Rick Smith, have pleaded guilty to bribing public officials. Their plea agreements require them to cooperate with investigators.

They testified at Kott's trial that VECO paid $2,750 for a poll that showed Kott where he stood in his re-election campaign in 2006. Kott subsequently lost in the Republican primary.

Smith testified that VECO had paid for other polls over the years, including a $20,000 poll in 2006 for former Gov. Frank Murkowski before he was a declared candidate for re-election.

Colberg assigned lawyers to closely watch Kott's trial in federal court to see if it revealed other possible criminal acts.

But he cautioned that the state would have to proceed carefully before pursuing its own criminal charges because federal authorities did not want interference from the state.

The Justice Department letter, dated Friday, puts the brakes on state investigators.

Palin said she has directed the attorney general to continue to monitor alleged illegal activities by public officials but that her office will not impede or compromise the federal investigation.

Former state Rep. Tom Anderson, R-Anchorage was sentenced Monday to five years in prison following his conviction in July on seven counts of conspiracy and bribery. He was convicted of taking nearly $24,000 that he thought was coming from a Houston-based company, Cornell Industries Inc., which hoped to build a private prison in Alaska.

The money was supplied by the FBI through an informant under contract to Cornell who secretly recorded his conversations with Anderson in 2004 and 2005. The company was not aware of the investigation.

Former House Speaker Pete Kott, R-Eagle River, was convicted last month of conspiracy to solicit financial benefits, extortion and bribery.

Former Rep. Vic Kohring is scheduled to go on trial on corruption charges Monday. The corruption trial of former state Rep. Bruce Weyhrauch has been delayed.

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