Alaska News

Federal officials won't prosecute Bill Allen on sex charges (Aug. 22, 2010)

Top officials in the U.S. Department of Justice have vetoed the prosecution of imprisoned former Veco chief Bill Allen on sex charges involving minors, closing an Anchorage Police Department and FBI investigation that began in 2004, according to the police officer who led the case.

The officer, Sgt. Kevin Vandegriff, along with Detective Michele Logan, who took over the case when Vandegriff was promoted to patrol sergeant, said they are unhappy with the decision, which was left unexplained to them by federal officials.

"I think that we put together a very solid case, we did a lot work on it, it deserved to be indicted and heard before a jury," Vandegriff said.

The two officers said the Justice Department trial attorney who had been working with them for nearly two years, along with the supervisor of his section, thought the case was strong enough to seek an indictment from a grand jury. But the two prosecutors, in the Child Exploitation and Obscenity Section in Washington, were overruled by officials atop the criminal division, Vandegriff said.

The trial attorney, Barak Cohen, CEOS section chief Drew Oosterbaan and criminal division head Lanny Breuer all referred requests for comment to a department spokeswoman, Laura Sweeney. Sweeney said department policy prevented her and the officials from discussing the reasons for not prosecuting a given case.

"We understand that not everyone will agree with every prosecutorial decision we make but we must continue to assess each matter based on the specific facts, circumstances, evidence and the law," Sweeney said in a prepared statement. "Our trial attorneys, section chiefs and division leadership evaluate these factors and make the decision determined to be the most appropriate given the totality of information before them."

In a statement issued Friday afternoon, Allen's attorney, Bob Bundy, said, "The judgment of the prosecutors not to seek criminal charges against Mr. Allen speaks for itself and renders speculation to the contrary meaningless and unnecessary. We are gratified to learn that professionals at the Department of Justice, after carefully reviewing all the various allegations over several years, have decided that charges against Mr. Allen are unwarranted."


The complaining witness, Paula Roberds, now 26, said the Justice Department's decision was "devastating" to her.

Roberds, originally from the small Bethel-area village of Goodnews Bay, said she only reluctantly came forward two years ago to allege that Allen flew her from Seattle to Anchorage about five times for sex when she was 16, paying her thousands of dollars in cash each time. She initially met him working as a 15-year-old prostitute along Spenard Road, she said.

The federal Mann Act makes it a felony to bring someone across state lines for prostitution and imposes enhanced penalties when the victim is a minor. There's no comparable state crime.

Now, after enduring multiple interviews with detectives, FBI agents and prosecutors, sketching the places where Allen had sex with her and providing graphic descriptions of Allen's physical anatomy and the sex they had, Roberds said she is bitter that she won't be able to tell her story to a jury in criminal court.

"Guys with money, they can do anything," she said in her first interview with Vandegriff on Aug. 20, 2008. She was 24 by then, struggling to make ends meet as a hotel housekeeper while raising her own daughter and a niece she was adopting.

While she acknowledged to Vandegriff that one motivation in coming forward was the possibility of suing Allen someday so she would have money to raise her girls, that wasn't her only reason for talking, she told the detective.

"What's the whole reason?" Vandegriff asked, according to a transcript of the conversation.

"To get Bill to stop seeing young girls," Roberds answered.


Until 2006, when the FBI caught Allen on videotape bribing Alaska legislators and overheard him on the telephone trying to cover up his renovations of the late Ted Stevens' home in Girdwood, Allen was one of Alaska's richest and most powerful figures. Allen palled around with Stevens and his friends. He played golf, hosted fundraisers and bought expensive gifts for U.S. Rep. Don Young. And he and other officials of Veco Corp. were some the most important sources of campaign contributions for the Alaska Republican Party and its candidates. He was the final publisher of The Anchorage Times.

Allen, now 73, is serving three years for bribery and tax violations at the low-security Terminal Island federal prison south of Los Angeles. With good time, he's due for release Aug. 22, 2012.

Vandegriff first opened a case on Allen in 2004 when Lisa Moore, an Anchorage woman who was then 26, reported she had sex with him when she was 18 and had seen several girls have sex with him when they were 15. One of those underaged girls was Bambi Tyree, then 23, and a defendant and chief witness in the cocaine and sex trafficking case of millionaire hardware store owner Josef Boehm of Anchorage.

Allen's relationships with Tyree and Moore have been written about extensively. Moore agreed to tell her story to the Daily News last year. While Tyree has not agreed to be interviewed, her relationship with Allen was documented in files in the Boehm case, the Alaska corruption cases, Anchorage police files and in interviews with other witnesses.

Roberds surfaced in 2008. She agreed to an interview with the Daily News then but declined to allow her name to be used and was unable to provide corroboration for her assertions. The Daily News withheld publication of her story at the time and only later alluded to her allegations when they surfaced in connection with appeals by two legislators convicted partly on Allen's testimony.

The Daily News usually withholds the names of the victims of sexual crimes unless they agree to have them published. Roberds agreed to have her name used in this story and said she's come to grips with the taboo against talking about being a prostitute, explaining her reasons:

"To make sure that he doesn't do this again, and I just feel like I deserve some justice," she said. To those who would say she had only herself to blame, she said, "I was young."

Vandegriff first spoke to Roberds on Aug. 20, 2008. Over the next eight months, Vandegriff and Logan, the police detective, confirmed major parts of her story, according to Anchorage police files, which were obtained by the Daily News under a public records request. The officers found corroborating evidence in airline and other business records obtained through search warrants and spoke to about two dozen witnesses, including two women who participated in "threesomes" with the Goodnews Bay woman and Allen for cash.


Roberds' mother told the officers she observed Allen picking up and dropping off her daughter, and said Allen once sent her and her boyfriend a bottle of champagne through her daughter. The mother told the cops she knew that Allen was giving her daughter money, flying her daughter from Seattle to Anchorage, and putting her up in the Hilton and other hotels.

'I SAID, '15' '

Vandegriff was part of the joint APD-FBI team that investigated Boehm, the hardware store owner. After interviewing Moore about Allen and pursuing some leads, he put the case aside at the request of the U.S. Attorney's office, which was prosecuting Boehm.

"In March 2004, I was advised by Assistant U.S. Attorney Frank Russo to not actively investigate this case as it might interfere with a federal investigation they were conducting involving Allen and Josef Boehm," Vandegriff wrote in a note to the file.

In an interview, Vandegriff said he didn't mean to imply they were both subjects of the same investigation. He said he thought the FBI, which had also interviewed Moore, was going to pursue her allegations against Allen. It didn't.

The APD case remained suspended until December 2007. By that time, Reps. Pete Kott and Vic Kohring had been tried and convicted. At each of their trials, prosecutors disclosed in closed hearings that Allen had been investigated for having sex with minors.

Word leaked out, and reporters called Vandegriff. The detective reopened the case, retracing his steps from 2004. The police file showed he re-interviewed Lisa Moore in January 2008 and several other women, but Bambi Tyree refused to talk to him.

Vandegriff initially was investigating Allen under state charges -- sexual abuse of a minor-- that prohibit adults from having sex with a child under 16. With one of the key witnesses, Tyree, refusing to cooperate, the evidence was contradictory and there was little corroboration, Vandegriff said. The district attorney's office declined to prosecute, and he suspended the case again.


Then the woman from Goodnews Bay showed up. Roberds said she too had sex with Allen when she was 15.

It was around the fall of 1999, and her boyfriend at the time, a man now in federal prison on drug and conspiracy charges, sent her to walk Spenard Road, she told the detective. About a month after she started work, she was standing on Spenard near 32nd Avenue when a big man in a white SUV pulled up and invited her into his car, she said. He asked if she were a cop.

"Don't I look too young to be a cop?" she replied, according to the transcript of her initial police interview.

She told Vandegriff that the man asked how old she was.

"I said, '15,' " she replied.

The man smiled, she said, and asked her to show him her breasts. She did.

He drove her to a warehouse in the industrial district along Arctic Spur Road and opened the door with a key, she said. The space was dark except for a light in an office area. There were objects that looked like cars, covered with tarps, and a small camper on jacks. The man took her into the camper and they had sex, she said. He paid her $200, she recalled.

Afterward, they exchanged phone numbers. Over the next few months, she saw him about 10 times, sometimes at the warehouse, sometimes at his home downtown, she said. She said she learned his name was Bill Allen and that he ran Veco. She had never heard of the company.

Then her boyfriend told her they were moving to Seattle. Allen wasn't happy, she said.

By then she was 16. Allen flew down once, and they met in a hotel near the airport. It was the only time they would ever spend the night together, she said. He took her shopping at a mall and bought her a $1,000 watch, a leather coat and clothes. He felt safe to appear in public with her in Seattle, she said, but not in Anchorage.

"I do remember him telling me a few times on different occasions that he really wanted to take me to dinner parties and stuff like that, and he'd always tell me I'm too young," Roberds told Vandegriff in his police car on Sept. 2, 2008, while driving around to locations where she said she had sex with Allen. "And I remember him saying, 'But you sure are a hot little thing.' "

Allen sometimes wired her money. About five times while she was in Washington state, he bought her round-trip tickets and put her up in Anchorage hotels, she said.


The first time, he got her an upper floor suite in the downtown Hilton. As she walked into the room for the first time, her eyes fell on a bouquet of red roses and two stuffed polar bears -- a mommy bear and baby bear.

She came to the Hilton two more times, and once each to the Hawthorn suites downtown and an airport hotel, she said. He would give her an envelope with about $2,000 in cash and shopping money. She usually stayed four days, and he'd visit her once each day.

Once, looking out the picture window at the Hilton through the snow toward the port, she told Vandegriff, Allen pointed to a BP sign marking the work area where Veco was building an oil-field module.

"He was telling me, 'Do you know what BP is?' And I'm like, 'No.' And he said, 'Well, wherever you see that sign, you know my men are there.' "

Allen asked her several times if she liked African-Americans, using a vulgar racial slur. Her boyfriend was African-American, and she didn't like his attitude, she said. "I was like, 'Well, I'm not racist,' " she told Vandegriff. "But you know, the way he said it, I felt he was."

In 2001 or 2002, Roberds moved back to Anchorage after her boyfriend was jailed in Seattle for beating another woman. She was not yet 18. Allen picked up the relationship, often taking her to his new house west of downtown, she said, but it eventually faded.


"One time he picked me up at the Hilton, and he gave me money to go shopping, and when I got into the car, he asked me, 'Do we have a relationship going on, or is this all about the money?' And I told him it was all about the money, and he got pretty upset about it," Roberds said. "He still saw me afterward, he just wasn't -- I don't know, he acted different."


Vandegriff and Logan set about corroborating her story. They asked her to draw the interiors of the warehouse, Allen's homes and the Hilton suites. They served a search warrant on the warehouse -- it was leased by Veco -- and the inside was just as she had drawn, though the camper was gone. The Hilton suites, too, matched her description, as did the homes, according to the detectives.

The search warrant served on Alaska Airlines uncovered three separate round-trip tickets between Seattle and Anchorage bought with Allen's American Express card, Logan said in a recent interview. Two trips were in February 2001, and another that March. At least one had Allen's phone number on the reservation as well, said Logan, who usually investigates financial crimes.

Roberds told the detectives another flight paid by Allen was on Northwest Airlines. Logan attempted to serve a search on that airline, but its records were in disarray over the merger with Delta, and no documents could be found, she said.

Cohen, the trial attorney in the Justice Department's Child Exploitation and Obscenity Section, came to Anchorage three or four times to prepare the case, Logan said. He interviewed witnesses and went over the evidence, sometimes picking fault with small details, Logan said. The pace was excruciatingly slow, she said.

"We were ready to go the grand jury in March, April 2009," she said. "The evidence is there."

Vandegriff said Cohen in particular found Roberds to be very credible.

"For the quality of witness that typically (she) would be, she is 100 percent consistent on her story, and it doesn't fluctuate or change whatsoever, and that was something he was totally impressed by," he said.

Vandegriff said Cohen "was a huge proponent of prosecuting and spent a lot of time putting together briefings." Cohen convinced his section chief, Vandegriff said. Sometimes that would be enough, but because of Allen's role in the corruption cases, the section chief told Cohen it had to be approved "by the highest levels in the Department of Justice, the head criminal chief for all of the Department of Justice."

If that was the case, the official would be Lanny Breuer, an assistant attorney general.

With the evidence they had, they expected quick approval last spring, Vandegriff said.

"But that didn't happen. They did their presentation, and we kept saying, 'What's going on? We haven't heard anything. We haven't heard anything. We haven't heard anything.' "

Finally, at the end of June, Vandegriff and Logan learned there would be no prosecution. Cohen told them he was at as much a loss as they were to understand why.

"They're very successful at shielding the rationale for their decisions," Vandegriff said. "Maybe it's because of the public corruption stuff. Maybe they still need him. Maybe there's some conflict that we're not privy too, as far as evidentiary stuff goes -- I don't know. I don't think Barak was made privy to that either, because he felt like this was a very righteous case. He worked really hard on it, so kind of like us -- worked really hard for naught."

A former head of the child sex unit, Virginia attorney Patrick Trueman, said in an interview it was unusual for a case to have progressed as far as Allen's did, only to stop before reaching the grand jury.

"The Justice Department must have had a major reason why this indictment wasn't allowed to go forward, and the public should probably know what that is," said Trueman, now a national advocate against pornography. "Sex with a minor, especially by a public figure, would be such a high-profile crime, there must have been a powerful reason not to move forward."

Defense attorneys in the corruption cases have long been suspicious of how quickly the FBI turned Allen and got him to agree to plea guilty to bribery and testify against others. It happened in a single day's work by several agents, on Aug. 30, 2006.

Prosecutors have said that Allen was convinced by the overwhelming evidence and a plea deal that spared his children from prosecution despite the criminal exposure of at least his son. The government also didn't prosecute Veco Corp., which it could have potentially driven into receivership, leaving nothing for Allen's children. Instead, his three children got more than $30 million each when the company was sold in 2007.

The defense attorneys raised the question of whether Allen was also told he could be prosecuted for child sex charges. Several noted a statement by the lead FBI agent in the case, who wrote in a report that Allen would become "unglued" by the prospect of exposure.

Those issues remain in the appeals of both Reps. Kott and Kohring. Kott's attorney, Sheryl Gordon McCloud, said she never received copies of the notes of the initial meeting between the FBI and Allen.

"What mention or inferences about his prior crimes occurred at that meeting?" she asked in a court filing.

With the Anchorage sex case closed, McCloud said, the questions have only intensified about whether Allen was promised, or at least led to believe, that he wouldn't be prosecuted for sex crimes if he agreed to work for the government in the corruption cases.

"It makes me wonder," she said.


In an interview this week, Roberds said she learned about the Justice Department decision July 28. Logan called and asked her to come to the police department. When she got there, the FBI agent who worked the case with Logan and Vandegriff, Jacqueline DeCou, was also there.

They tried to get Cohen on the phone, but he was on leave, she said.

"They told me that the case was denied -- they decided not to prosecute Bill Allen," Roberds said. "They were saying they were pretty upset about it. They were explaining to me that we basically had all the evidence that we needed to prosecute, and they themselves didn't know why it got denied, so they couldn't give me a reason."

Her attorney, Kenneth Roosa, a former state and federal prosecutor who has represented the victims of priest abuse and other sex crimes for years, said he also was surprised. It would be one thing if the Justice Department said the evidence was bad, or they found Roberds to be a liar. But that wasn't the case, he said.

"For Paula, and certainly for me, the fact that they did this for what appears to be pretty clearly political reasons or some self-serving secret federal reason, it's pretty shocking, and it's pretty disgusting," Roosa said.

"I'm not blaming the detectives," Roosa added. "But certainly, the attorneys in the Department of Justice have mishandled this case so badly that there ought to be an investigation of those guys as well. For them to allow a wealthy Alaska businessman to repeatedly sexually abuse an Alaska teenage girl and then get away with it, with the evidence and the documentary evidence as clear as it is in this case, is unfathomable."

Find Richard Mauer online at or call 257-4345.

Feds won't prosecute Allen on sex charge (8/20/10)

Alleged cover-up cuts into Allen credibility (12/13/09)

Police suspend Allen sex inquiry (06/3/08)

Allen teen sex inquiry reopened (02/3/08)


Richard Mauer

Richard Mauer was a longtime reporter and editor for the Anchorage Daily News and Alaska Dispatch News. He left the ADN in 2017.