Key Govt. Witness 'Wanted to Help' Stevens

Alaska Sen. accused of hiding gifts from ex-VECO CEO Bill Allen and his company.

Oct. 1, 2008— -- The government's key witness in its corruption case against Sen. Ted Stevens told the court he never sent the Alaska Republican a bill for the massive home renovation at the heart of the case because he "wanted to help" and that he "liked" the senator.

Bill Allen, the former CEO of now-defunct oil services firm VECO, took the stand for the second day in a row Wednesday, telling the court about his company's involvement in the renovation project carried out at Stevens' Girdwood, Alaska, home, as well as his efforts to bribe various Alaska state lawmakers in order to benefit his business.

Stevens, 84, the longest-serving Republican U.S. Senator, is on trial for allegedly concealing $250,000 worth of gifts, including the renovations, on financial disclosure forms required by the Senate. He has pleaded not guilty to the charges.

Under questioning from prosecutors, Allen testified about his conversation and correspondence with Stevens about expanding his simple one-level A-frame home into a three-story house. Allen provided testimony which may play into the defense's argument that Stevens' wife Catherine was the main director of the renovation project when he told the jury, "[Sen. Stevens] told me Catherine wanted to be in the middle of it… she was interested in having a bigger house."

The VECO architect's design "really pleased Catherine," Stevens noted in one e-mail.

The prosecution then provided several notes from Stevens from 2002. In one of the letters, Stevens asked Allen for a bill. "You owe me a bill… remember Torricelli, my friend," Stevens wrote, in reference to former Sen. Robert Torricelli, who was ousted from the U.S. Senate amid an ethics investigation.

"Friendship is one thing Congressional... ethics rules entirely different," Stevens also noted.

Asked by prosecutors why he never sent a bill to Stevens, Allen, after a long pause said, "I don't know why… I really didn't want to."

Allen testified, "I wanted to help Ted because I liked him."

The prosecution is set to release FBI tapes of phone conversations between the men as soon as Thursday.

Global Oil Projects

The prosecution also had Allen describe a variety of projects that VECO was engaged in, including work on an oil and gas line in Pakistan and a variety of oil projects around the world on which he sought Stevens' help.

The government entered into evidence a letter Ted Stevens sent to the head of the World Bank in 1999 to get support for the Pakistan project. VECO received dividends on the project from the government of that country.

VECO was also involved in obtaining a grant from the National Science Foundation and an oil and gas project in Russia's Far East. Allen testified that he met Stevens on Sakhalin Island to tour an area that would have trained VECO workers in Russia.

Bribing Alaska State Lawmakers

Allen also detailed his attempts to influence the development of a natural gas pipeline from the North Slope of Alaska through Canada to the center of the US.

He described from the witness stand how the FBI approached him in August 2006, wanting to know about political donations he made to members of the state legislature to seek their assistance in development of the pipeline.

Allen pleaded guilty to federal corruption charges last May, and several state lawmakers and other VECO employees have done the same.

Allen and VECO were supporting a plan by then-Gov. Frank Murkowski, R-Alaska, which would have taxed three major oil companies, BP, Exxon and ConocoPhillips, 20 percent for production of gas on the North Slope, but would have then provided a 20 percent tax break for construction of the pipeline done by the three major firms.

As the CEO of VECO, Allen and his top tier of executives had devised a plan providing Alaska state officials with campaign donations. Allen and others at VECO came under FBI scrutiny for setting up a plan to reimburse VECO employees for campaign contributions they made with "special bonuses."

Allen testified that he agreed to help the FBI to protect his family and his son, who also might have come under investigation. Allen testified that his son made some donations to a Stevens' son Ben, who is an Alaska state lawmaker. Under instructions from the judge, Allen did not name Ben Stevens in court.