With Ben Stevens as chief of staff, questions about Veco scandal remain

Gov. Mike Dunleavy demoted Tuckerman Babcock this week and promoted former Sen. Ben Stevens to chief of staff, one of the top jobs in state government.

Stevens, who received a raise of $25,000, will make $175,000 in his new post, while Babcock, who earns $160,000, did not take a pay cut with his new job as “senior policy adviser for strategic affairs.”

Now that Stevens holds a central post in the executive branch, the unanswered questions that remain from the Veco scandal deserve more attention by the state’s news media and others who follow Alaska government.

Here is a 2011 summary of the case by Rich Mauer, former investigative reporter for the Anchorage Daily News.

Bill Allen, who at one time was a power broker in Alaska politics, provided financial backing to many candidates, with Rep. Don Young and Sen. Ted Stevens among the top beneficiaries.

Allen had Ben Stevens on his payroll during years when Ben Stevens served in the state Senate. What exactly did Stevens do for Veco? Stevens, a son of the late Sen. Ted Stevens, said he did not have to reveal what he did.

The name of Ben Stevens came up frequently in the recorded conversations made in Room 604 of the Baranof Hotel, where Allen and Rick Smith hatched political plots. One national reporter said at the time about Ben Stevens, “the way the men in this room speak of him it sounds like he's a member of the Corrupt Bastards Club.”

On June 1, 2006, Rep. Pete Kott was in Allen’s room to collect $1,000, when Kott was suggesting Allen visit legislators in their offices. Allen said he wanted to meet with Sen. Con Bunde and pressure him to side with Ben Stevens on a measure Allen wanted approved. “I’m gonna talk to Bunde and say, you know, you need to get this mother fucker done and get over here with Ben and get the fuck out of here, before we can get out of here, so I can get you some help too, before I can get you some money on the election.”

Allen and Kott looked a sheet showing how several senators would vote, with Allen saying of the list, “That’s what Ben told me.”

In the 2007 corruption trial of former Rep. Pete Kott, former Veco Vice President Rick Smith was asked which state senators had been bribed. "That would be Ben Stevens and John Cowdery," Smith said.

One of the first hiring decisions made by Dunleavy last December was to name Ben Stevens as a policy adviser, a low profile job compared to that of chief of staff.

Here is what I wrote at the time:

By giving a good state job to former Sen. Ben Stevens, Gov. Mike Dunleavy has signaled that as far as the Republican Party is concerned, it’s time to forget all about the Veco scandal.

Stevens is to become a policy analyst, working on transportation, legislation and fishing, Alaska Public Media reported.

He will assume his new government job with many questions still unanswered about his time in the Legislature.

What we still don’t know is what Stevens, a son of the late Sen. Ted Stevens, did as a senator to earn the $243,250 he was paid by Bill Allen, the onetime king-maker in Alaska Republican circles who went to jail as the central figure in the Veco corruption scandal.

Ben Stevens was never charged with any crime after years of federal investigations related to political corruption. Stevens denied taking bribes from Allen, who pleaded guilty to bribing four legislators, Stevens being one of them.

Stevens is now a manager at Cook Inlet Tug and Barge, a company owned by Foss Maritime Holdings.

As a legislator, Ben Stevens refused to say what "business services" he performed for Veco from 2002-2006, years when he was in the Legislature, because he wasn’t required to do so.

"I don't have to say that," Stevens responded when asked at a press conference in 2005. He met the requirements of the time by reporting the payments, though that law has now been changed.

Allen testified that the payments to Stevens were mainly for his work in the Legislature. In court documents against Allen and Smith, Ben Stevens was referred to as “State Senator B,” who received $243,250 from Veco, the exact amount Stevens reported to state officials in disclosure filings.

Allen said the money paid to Stevens was not for consulting, but for "giving advice, lobbying colleagues, and taking official acts in matters before the Legislature." Allen promised Stevens he would give him a job as an executive after the left the Legislature, according to the government.

Stevens fought for lower oil tax rates in the Legislature, which is what Allen wanted as well.

Allen, once a revered figure in the world of Alaska Republicans, did time in federal prison in 2010-2011 for bribing lawmakers and cheating on taxes.

The multiyear federal corruption probe collapsed after the conviction of Sen. Ted Stevens was tossed out because of misconduct by the prosecutors.

Ted Stevens had been convicted of not reporting gifts, but prosecutors had withheld information that might have helped Stevens and undermined Allen's credibility as a witness.

The state never mounted an investigation of its own into political corruption, ignoring what was revealed by the federal effort and pretending that there was no need for any more digging.

The state never acted upon what the FBI learned from wiretapped phone calls and the camera hidden inside a lamp in Room 604 of the Baranof Hotel in Juneau. That was where Allen and his top lieutenant, Rick Smith, met with legislators to try to force decisions favorable to the oil industry, which was good for Veco.

In the recordings made public as part of the investigation, the name of Ben Stevens came up on numerous occasions. The Veco executives spoke of him as one of their two most important allies.

In a phone call on June 6, 2006, with Jim Bowles, the president of ConocoPhillips Alaska, Allen boasted about how Rep. Pete Kott and Stevens, then the Senate president, were working hard to stop an oil tax bill.

"Just between me and you, I've got Pete Kott . . . and Ben doing it," Allen said on the wiretapped call. Bowles said the best possible outcome will be to "get this thing stopped," which is what happened.

This page includes a link to the audio of that phone call.

In a phone call with Kott on Jan. 10, 2006, Allen said, "About the only one that I can trust is you and old Ben Stevens."

The FBI searched the offices of Ben Stevens and five other legislators on Aug. 31, 2006.

That was the day after Allen began cooperating with the government. Allen, aware that his words were being recorded, reached Sen. Ted Stevens on his cellphone in San Francisco.

Allen told Ted Stevens that the FBI had a search warrant and was asking him about Ben Stevens and was "trying to figure out" exactly "what he done for us."

About six weeks later, in another call with Allen, Ted said that Ben was distressed by what was going on, but he was trying to cheer up his son.

"I've seen guys get down in a deep hole. And I think Ben is about there, too," Ted told Allen on Oct. 18, 2006.

Allen said, "It really would hurt me if his little family got screwed up."

Stevens said Ben has "got to stop being just so depressed because it'll spring over to the kids. He's going to do all right. When his term finishes, we'll get some funds to help him pay his law firm, his legal fees. But he's got a tough row to hoe."

“Those guys, they've done this to him three times before remember? He's been through this, state procedures three times. And he says, 'Dad, there's no end to it.' And I said, 'You're wrong. You're out ... these guys are political. As soon as they know you can't, you're not a threat to them, they're going to forget about this.' But the people involved in this investigation aren't. So we got a new, new, new thing to contend with. But I said, 'Don't get a bad attitude,’” Ted Stevens said.

Ben Stevens received from $43,000 to $57,000 a year from Veco, listing the payments as being for "business services," which continued until one month before the FBI got a search warrant to search his office on Aug. 31, 2006.

Asked which legislators had been bribed, former Veco Vice President Smith testified in 2007, "That would be Ben Stevens and John Cowdery."

Sen. Cowdery pleaded guilty to conspiracy in 2008.

Allen and Smith eventually accepted plea deals, admitting they had made more than $400,000 in illegal payments to various officials.

Ben Stevens had started working for Veco in 1995, six years before Gov. Tony Knowles appointed him to fill a vacancy in the Senate.

"How am I supposed to say, 'Now that you're a senator, Ben, I can't give you more money,'" Allen testified at the trial of former House Speaker Pete Kott in 2007. "I couldn't do that."


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