The federal corruption investigation reached into the office of former Gov. Frank Murkowski on Monday when his chief of staff, Jim Clark, agreed to plead guilty to a felony conspiracy charge involving the defunct oil-field company Veco.
Clark, once the most powerful non-elected state official, admitted to joining Veco chairman Bill Allen and others to secretly spend $68,550 of the company's money on polls and a political consultant for Murkowski's failed re-election bid in 2006.
Clark said late Monday night that he is sorry for what he's done.
"My plan here is very simple. I'm going to take my medicine. I'm just going to be accountable for what I did and apologize to the people I need to," Clark said.
The payments represented an illegal campaign contribution to Murkowski by Veco and illegal expenditures by Murkowski's failed campaign, the government charged. The payments went undisclosed on Murkowski's campaign finance reports, a violation of Alaska law, the government said.
The charges had their root in the same saga that has resulted in convictions so far of two legislators and pending charges against a third: the Murkowski administration's negotiations and ultimate agreement with North Slope producers to change Alaska's petroleum tax structure to their liking and to move toward construction of a trans-Alaska natural gas line.
Veco staunchly supported the agreement as it tried to curry favor with its oil-company clients. It also hoped to land contracts building the gas line. Allen and a Veco vice president, Rick Smith, stooped to bribing legislators to get the agreement ratified in the Alaska Legislature in 2006 -- payments recorded by an FBI camera hidden in the company's lobbying suite in Juneau.
That same year, a large field of candidates sought the governor's office, but only the incumbent, Murkowski, supported the negotiated agreement with the producers, prosecutors said. That made him Veco's candidate, even as his popularity was plummeting among Alaska voters.
The Veco conspiracy Clark joined was one in which Veco and Murkowski would benefit, the government charged. Veco would get an administration supportive of the tax and pipeline deal, and Clark would get Veco's assistance in re-electing Murkowski.
"How much did Frank Murkowski know about what Jim Clark was doing?" said House Speaker John Harris, R-Valdez, echoing the words of many others in the Capitol Monday as word of Clark's plea quickly spread.
Murkowski wasn't named as a conspirator in the charges. Messages left on Murkowski's cell phone weren't returned. He was reported to be traveling in the Lower 48.
The charging documents and Clark's plea were filed late Monday afternoon in U.S. District Court in Anchorage. Clark is expected to formally enter his plea before U.S. District Judge John Sedwick this afternoon.
Clark is the first member of the executive branch to be charged in the wide-ranging FBI investigation that has resulted in convictions of three former Alaska legislators, pending charges against a fourth, and guilty pleas by a lobbyist and Veco's Allen and Smith.
In a document describing the facts that Clark was pleading to, the government said that it was "merely" summarizing some of Clark's illegal conduct, "but not all." Clark is required by his plea deal to join a growing list of cooperating government witnesses required to testify before grand juries and at trials. The government is seeking to delay his sentencing at least six months because of the complexity of the ongoing inquiry.
While the agreement protects Clark from additional related federal charges as long as he assists the government, it doesn't block the state from pursuing its own charges.
Additional legislators, Stevens and U.S. Rep. Don Young, R-Alaska, are among those being investigated.
The charging documents said that even with his cooperation, Clark is facing more than three years in prison and a fine of up to $75,000.
As Murkowski's chief of staff, Clark cheated Alaskans, the charges said. The illegally undisclosed payments and expenditures deprived "the citizens of the State of Alaska of the honest services of Clark and others," the charging documents said.
Clark and his fellow conspirators knew full well "the public of the State of Alaska would be deceived as to the existence of these payments as well as their true nature source," the charges said.
The charging documents used letters to shield the identities of the two polling companies and the out-of-state consultant receiving the Veco money.
But Anchorage pollster David Dittman confirmed Dittman Research Corp. of Alaska is the firm listed in the plea agreement as "polling company A."
Dittman, who testified about polls he conducted for Veco during the trial last fall of former House Speaker Pete Kott, said Monday that Clark had contacted him about doing the poll for Murkowski.
"Just that we wanted to do a poll and Veco would pay for it," Dittman recalled Clark saying.
"We sent the invoice (to Veco) and delivered the report to them," Dittman said.
Dittman said the last he'd heard of the poll issue was when Clark denied his involvement in late September.
"Between then and now I didn't know what information or evidence I guess they showed him," Dittman said.
He said he didn't know federal prosecutors were pursuing charges on the poll and hadn't spoken to the FBI about it for several months.
Dittman said he doesn't believe he will have any legal troubles associated with the poll. He said Murkowski wasn't even an official political candidate at the time Veco bought the poll to measure his popularity. Dittman said he wasn't aware the polling broke any rules.
"We didn't do anything wrong," Dittman said.
Dittman said he didn't know the identity of the other polling company or consultant in Clark's plea agreement.
"I think that happened after I resigned from the campaign," he said.
Dittman was working for the Murkowski campaign until the final few weeks before the primary.
PALIN SPEAKS OUT
The other polling firm is located outside of Alaska, the charging documents said. The documents described the consultant as someone "who provided strategic analysis and other services to the campaign of the Governor of the State of Alaska."
Murkowski was handily beaten by Sarah Palin in the Republican primary in August 2006, and she went on to win the general election that November. She learned about Clark's plea from a reporter Monday afternoon.
"Wow," she said. "It's more evidence this is very far-reaching -- even to this -- with the prior administration's chief of staff."
Palin said she met with FBI officials in Anchorage just a couple of days ago and they gave her no indication this was coming. She said the meeting was to get an update and talk to a new FBI official in the state.
"They confirmed that they still have quite a bit of work to do with the corruption probe," Palin said.
Palin said it's disappointing to know Clark was involved but she's glad the FBI is taking seriously what Alaskans have long speculated.
"When this type of evidence surfaces it's all the more reason for us to remain committed to not allowing ethical lapses to drive any agenda or decision on behalf of the people of Alaska," Palin said. "It really confirms our commitment because Alaskans are tired of this."
This story was written by Richard Mauer, with reporting by Sean Cockerham in Anchorage and Wesley Loy in Juneau. Find Mauer online at adn.com/contact/rmauer or call 257-4345. Find Cockerham at adn.com/contact/scockerham or 257-4344.
Federal investigation snares No. 8
Jim Clark is the eighth person charged since the federal investigation into Alaska public corruption burst into public view with the FBI raids on state legislators' offices in August 2006. It's unclear who, if anyone, will be charged next. The agencies investigating -- the FBI and the U.S. Justice Department's Public Integrity Section -- won't discuss their targets.
But federal grand juries in Anchorage and Washington, D.C., have heard information involving Sen. Ted Stevens, including his relationship with Veco, the now-defunct oil services firm at the center of most of the cases brought so far. And U.S. Rep. Don Young, who has been reported by various media as the target of one or more inquiries, reported spending more than $854,000 in legal fees from his campaign treasury in 2007 but refuses to say what the lawyers are doing for the money.
At least two current or former state lawmakers have been identified in prosecution filings and testimony as committing illegal acts in cahoots with Veco officials: former state Sen. Ben Stevens and current Sen. John Cowdery, both Anchorage Republicans. They haven't been charged.
Former House Speaker Pete Kott of Eagle River was convicted by a jury last year of bribery, extortion and conspiracy. He began serving a six-year prison term in January.
Former Rep. Vic Kohring of Wasilla was convicted by a jury last year of bribery, conspiracy and attempted extortion. He's awaiting sentencing; prosecutors are pushing for five years.
Former Rep. Tom Anderson, R-Anchorage, was convicted in July of bribery, money laundering and other charges for taking payoffs from a consultant and is serving a five-year sentence.
Former Rep. Bruce Weyhrauch, R-Juneau, was charged with bribery and other crimes for his dealings with Veco executives. He's awaiting trial while questions about evidence in his case are appealed.
Former Veco CEO Bill Allen pleaded guilty to bribery and conspiracy for his dealing with Kott, Kohring, Weyhrauch and other lawmakers. He's cooperating with the authorities and awaiting sentencing.
Former Veco vice president Rick Smith pleaded guilty to bribery and conspiracy for his dealing with Kott, Kohring, Weyhrauch and other lawmakers. He's cooperating with the authorities and awaiting sentencing.
Former lobbyist Bill Bobrick, a longtime lobbyist on the city level, pleaded guilty to conspiracy for bribing Anderson. He cooperated with the authorities and was sentenced to five months in December.
-- Anchorage Daily News