Alaskans wonder if former lawmaker will be charged

Ben Stevens has been implicated, but not charged with any crime

Posted: Friday, December 07, 2007

ANCHORAGE - The FBI over the last year slapped handcuffs on four former Alaska lawmakers with ties to a major oil field service company, VECO Corp. Three were convicted in federal court of corruption charges and a fourth awaits trial.

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So far, another former legislator connected to VECO, Ben Stevens, the son of U.S. Sen. Ted Stevens, has been spared that indignity.

Despite testimony from two VECO Corp. executives that they bribed Stevens, the 48-year-old Anchorage Republican and former president of the Alaska state Senate hasn't been charged.

Federal prosecutors are loath to volunteer details of pending investigations but may have a variety of reasons for not scheduling a perp walk for Stevens.

They may be waiting to finish their first round of prosecutions before pursuing Stevens.

"It is very common to take a stair-step approach to certain investigations," said E. Lawrence Barcella Jr., a former assistant U.S. attorney for the District of Columbia, now a defense attorney. "You start at one level and work your way up the steps. It's not unusual at all."

Prosecutors may be investigating allegations unconnected to VECO and the petroleum industry, including Stevens' involvement with the fishing industry.

And despite what's been said in court, they may never prosecute him at all, according to those familiar with federal corruption investigations.

Through his attorney, John Wolfe, Ben Stevens has consistently denied engaging in any illegal activity alleged by former VECO executives Bill Allen, the founder and CEO, and Rick Smith, the company's vice president for government affairs.

"Two people who have a cooperation agreement with the government and are seeking to minimize the amount of prison time they serve because of the crimes they committed," Wolfe said Thursday.

Wolfe said there has been speculation that an arrest has not been forthcoming because his client has a cooperation agreement with the government. Stevens does not, Wolfe said.

"Rumors to the contrary are false," he said.

VECO, with more than 4,000 employees, lived off contracts with oil producers, performing maintenance, construction and design work. The company was sold in September.

Allen and Smith were star prosecution witnesses in the corruption trials of former state Reps. Pete Kott and Vic Kohring.

Allen in May pleaded guilty to bribery and later testified he illegally influenced Kott, Kohring and Stevens. Smith also pleaded guilty and later testified he bribed Stevens, Kohring, Kott, former state Rep. Bruce Weyhrauch, who awaits trial, and state Sen. John Cowdery, who has not been charged. Cowdery, like Stevens, had his office raided by the FBI. Cowdery has denied any wrongdoing.

As Allen and Smith await sentencing, their plea agreements - and their hopes for a reduced prison term - compel them to provide substantial assistance in other cases.

In the 2006 legislative regular and special sessions, Allen and Smith pushed lawmakers hard to approve measures that could lead to construction of a natural gas pipeline tapping North Slope reserves and delivering them to the Midwest - Alaska's next big boom.

Before major petroleum producers would risk billions on a natural gas project, however, they wanted stability in Alaska's crude oil taxes - a revised law that set an acceptable rate and provided incentives for investment. If the law passed and pipeline were built, VECO stood to bid on hundreds of millions of dollars of work not only on the pipeline but in renovating oil infrastructure. VECO officials admit they were willing to bribe lawmakers to see that happen.

In a conversation secretly recorded by the FBI and played in court, Allen told Smith that he did not trust the intentions of most lawmakers but that Ben Stevens was his go-to guy in the state Senate and Kott in the House. Kott will be sentenced Friday.

Allen's connection to Ben Stevens began well before the pipeline debate.

Allen testified at Kott's trial that he was impressed with Stevens in 1995 when Stevens was a married college student attending George Washington University, working two jobs to support his family. Allen recruited Stevens to approach the World Bank for money VECO needed on a spill cleanup job in Russia, then kept him on a monthly consulting contract.

When Stevens later was appointed to the state Senate in 2002, Allen testified, Stevens kept his monthly VECO contract. Allen said he did not feel right cutting financial ties to Stevens because of his appointment. However, the only work he did, Smith testified, was giving advice on legislative issues, lobbying colleagues and official acts before the Legislature.

Over five years in office, VECO paid Stevens $243,250 - a sum far exceeding the dribbles of cash received by two former lawmakers convicted of taking VECO bribes.

Kott was convicted of accepting nearly $9,000, a $2,500 political poll and the promise of a job after he left the legislature.

Kohring was convicted of accepting at least $2,600.

Tom Anderson, convicted of taking nearly $24,000 from what he thought was a private prison company, also had a $20,000 contract with VECO for which he performed no work, according to Smith. Anderson was not charged in that matter.

All three cases relied heavily on audio or video evidence secretly recorded by the FBI, something that may be lacking in the Stevens' investigation.

Without referring to Stevens, Barcella said there are legal reasons why a person named as the recipient of a bribe might not be charged.

It is legally possible, he said, for someone to be guilty of offering a bribe without the recipient being charged. The crime requires specific intent, he said.

"The giver and the receiver, in the sense being in the same mind," he said. It's unusual but not unheard of to have differing intents, he said.

Barcella also said prosecutors aiming at high profile targets want a strong case before ordering an arrest.

"The practical side of it is, if you're shooting for a king, you better get that first shot between the eyes," he said.

Indicting a suspect starts the clock on the trial process, giving prosecutors deadlines to make their case. Prosecutors would want to make sure they had as solid a case as possible before they did that, Barcella said.

But the simplest explanation for why Stevens has not faced a judge is that his case could involve more than the gang at VECO.

Investigators are reviewing Stevens' ties to the $2 billion per year commercial fishing industry and federal legislation pushed by his powerful father that could have directly or indirectly aided him.

Ben Stevens was the first board chairman of the Alaska Fisheries Marketing Board, which provided federal money to promote Alaska seafood, a program created with a funding earmark by Sen. Ted Stevens. The board approved grants to companies that paid the younger Stevens consulting fees, according to state financial disclosure reports.

An earmark in 2003 gave exclusive pollock fishing rights to Alaska natives in Adak, an Aleutians Island community. The measure was worth millions for Adak Fisheries to manage the catch of pollock, the lucrative whitefish commonly used in fish sticks and fish sandwiches.

The company paid Ben Stevens $295,000 between 2000 and 2004, according to state financial disclosure reports. When the earmark went through, Ben Stevens also secretly held an option to buy into Adak Fisheries.

Congress in 2000 approved a $100 million federal loan program to buy out Alaska crab boats, trim the size of the fleet and boost prices. The Bering Sea Crab Effort Reduction Fund, an industry group that supported the buyout program, hired Ben Stevens' company, Advance North, as a consultant.

Congress in 2004 approved a $50 million loan program that, like the crab buyback, sought to trim the Alaska salmon fleet. The Southeast Alaska Seiners Association, a salmon fishing organization, hired Advance North to help push the deal. Ben Stevens was not a federal lobbyist and the salmon fishing group said Stevens' business partner, Trevor McCabe, did the lobbying. McCabe is a former legislative director for Sen. Ted Stevens.

Through his spokesman Thursday, Ted Stevens reiterated his long-standing policy of not discussing pending investigations - including reviews of substantial renovations performed by VECO at his Alaska home - so he will not be perceived as trying to influence the investigation.

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