The former head of one of Alaska's largest oil field service companies admitted Thursday to bribing three former Alaska lawmakers, including...
ANCHORAGE, Alaska — The former head of one of Alaska’s largest oil field service companies admitted Thursday to bribing three former Alaska lawmakers, including former Senate President Ben Stevens, the son of U.S. Sen. Ted Stevens.
Former VECO Corp. CEO Bill Allen, 70, testified Thursday in the federal corruption trial of another former lawmaker, Pete Kott. Allen and a former company vice president, Rick Smith, have pleaded guilty to bribing lawmakers, and await sentencing.
On the stand Thursday, Allen said he bribed Ben Stevens, Kott and Vic Kohring, but did not elaborate during 15 minutes of testimony.
Ben Stevens is under federal investigation, but has not been charged.
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“Mr. Stevens has consistently said he’s not engaged in any of the illegal activity that is alleged by Mr. Allen. He denies it,” John Wolfe, Stevens’ attorney, told The Associated Press.
The FBI also is investigating a remodeling of the elder Stevens’ home in Girdwood. The project doubled the size of the home. According to at least one contractor in the case, invoices were first sent to VECO.
Ted Stevens has said he paid all bills on the home that he received.
Kohring faces trial next month. Allen did not mention another former lawmaker facing bribery charges, Bruce Weyhrauch.
Allen also testified he agreed to cooperate in the corruption investigation of Alaska lawmakers after the FBI promised that his three adult children would not be indicted.
Kott, whose trial began Monday, is charged with doing the bidding of VECO in exchange for money and the promise of a job.
He is accused of turning in a phony invoice to Allen for $7,993, which was used to hire Kott’s son as his re-election campaign manager. Kott is accused of taking a check for $1,000 as reimbursement for a campaign donation in the same amount to former Gov. Frank Murkowski. Kott also is accused of accepting a political poll in his re-election big paid for by VECO.
Kott is charged with conspiracy to solicit financial benefits for his service as a legislator, extortion “under color of official right,” bribery and wire fraud, which involved improperly discussing legislative business by phone.
Defense attorney James Wendt claims Kott was not aware of the poll and that the flooring check was an advance payment for work that would have been done in late 2006 if the federal investigation had not occurred.
Wendt said Kott committed no crime by working with businessmen and lobbyists toward a goal shared by most Alaskans: passing legislation that would lead to construction of a natural gas pipeline.
Secret electronic recordings played over the trial’s first three days show Kott working closely with Allen and Smith over a proposed change in Alaska’s crude oil tax. The measure had two key numbers: the rate at which oil would be taxed, and the rate of tax credit companies could receive for reinvesting in Alaska with drilling rigs or other structures and equipment.
The measure was the dominant issue of the 2006 legislative session. It was also considered a gateway measure that had to be passed before the legislature would consider measures leading to construction of a natural gas pipeline project tapping the state’s vast North Slope natural gas reserves.
That megaproject, on the scale of the 30-year-old trans-Alaska oil pipeline, would have presented VECO with the opportunity to bid on hundreds of millions of dollars worth on contracts. Allen said on the secret recordings and in court that he considered the pipeline essential to the continued prosperity of not only his company but to Alaska as oil production filling the trans-Alaska pipeline continues to diminish.
Allen spent just minutes Thursday under direct examination by federal prosecutor James Goeke. Unlike his first day on the stand, prosecutors played no wiretapped phone conversations or images and conversations secretly recorded in a room rented by VECO in Juneau’s Baranof Hotel.
Goeke simply asked Allen to recall how he had been approached by FBI agents on Aug. 30, 2006, just before agents raided the legislative offices of a half dozen Alaska legislators and VECO offices.
Allen was told the investigation did not need him, but if he cooperated, he would receive considerations.
“Your kids won’t be indicted and they would help VECO,” Allen said.
Allen has cooperated with the investigation from that day on, he said.
Later on Aug. 30, at the government’s request, Allen called Kott with potentially incriminating questions regarding a payment Allen made to Kott through his flooring business. Prosecutors contend Kott inflated an invoice for work never performed on hardwood floors at Allen’s home.
The check, according to prosecutors, was destined for Kott’s son, whom Kott needed as his campaign manager for his re-election campaign.
“I asked him if he got the money for his son,” Allen testified about the phone call that day. Allen said he was told by Kott that he received the check.
“I said, ‘How did it happen?’ He said, ‘It was a check from you.’ I said, ‘I don’t think so, Pete,’ ” Allen said.
The money was to help Kott with his campaign, Allen testified, and Kott did no work for the money, Allen said.
“That’s the way I understood it. Yeah,” Allen said.
Kott also had expressed to him that he wanted to be a VECO lobbyist and Allen was willing to give him that job, he said. That would not have happened if Kott had suddenly changed his opinion on the oil tax and favored a higher rate.
“He wouldn’t have had a job,” Allen said.
Allen said his own plea negotiations later involved unsuccessful attempts to help his company and its 4,000 or so employees.
“The executives and myself, they were the ones who done anything,” Allen said.
He said he received no promises.
“I asked them repeatedly and they wouldn’t do that,” Allen said. “I didn’t think those people should be punished. They hadn’t done anything.”