FBI Probes Stevens's Earmark

Internal Revenue Service and FBI agents search the home of Sen. Ted Stevens (R-Alaska) in Girdwood, Alaska.
Internal Revenue Service and FBI agents search the home of Sen. Ted Stevens (R-Alaska) in Girdwood, Alaska. (By Al Grillo -- Associated Press)
By Paul Kane and Dan Eggen
washingtonpost.com Staff Writer and Washington Post Staff Writer
Wednesday, August 1, 2007

The FBI is investigating whether Sen. Ted Stevens (R-Alaska) used a $1.6 million congressional appropriation to help an Alaska marine center purchase property from a business partner of the senator's son, said sources familiar with the probe.

That investigation comes amid a widening federal grand-jury probe into Stevens's connections to an energy services company. The FBI and the Interior Department's inspector general are also jointly examining a series of budgetary earmarks endorsed by Stevens in recent years for the Alaska SeaLife Center in Seward, said sources familiar with the probe who spoke about it on the condition of anonymity.

Investigators are particularly interested in how those earmarks may have helped the marine center buy land from Trevor McCabe, a former Stevens aide who was also a business partner of Stevens's son, Ben, according to sources and news reports. Ted Stevens has wielded enormous clout as a senior member of the Appropriations Committee, which he chaired for six years, regularly steering hundreds of millions of dollars a year in earmarks for his home state.

The center got a $1.6 million earmark to buy adjacent property owned by McCabe, sources said. The land was eventually sold by McCabe's firm to SeaLife for $550,000, according to sources and news accounts.

Officials with the Office of Inspector General at the Interior Department have interviewed a "handful" of employees at the National Park Service in recent weeks, said Marcia Blaszak, the service's regional director in Alaska. Investigators are interested in Park Service employees because the service was another prospective buyer of the McCabe parcel before it was sold to the SeaLife Center. The SeaLife investigation by the FBI and the Interior Department was first reported yesterday by Roll Call. McCabe could not be reached for comment yesterday. FBI officials declined to comment.

Stevens has declined to comment on most of the specific allegations against him, including the SeaLife purchase. But after his home outside Anchorage was searched for nine hours Monday by federal agents, Stevens spoke briefly yesterday behind closed doors to a group of Senate Republicans and Vice President Cheney, pleading for them to not to prejudge him based on news reports. "He's asked us to await all information during this investigation, and I will, while I'm standing by our longest-serving colleague," Senate Minority Whip Trent Lott (R-Miss.) said.

Sen. Daniel K. Inouye (D-Hawaii), Stevens's closest friend in the Senate who has served with the Alaskan for decades, spoke with Stevens early yesterday and came away reassured of his innocence. "He's convinced, I think, that he didn't do anything wrong," Inouye said. "He's my friend, and he'll continue to be my friend."

But the raid on Stevens's home Monday by FBI and Internal Revenue Service agents heightened pressure on the longest-serving Republican in Senate history, who has been under scrutiny since last year by federal grand juries examining a home-remodeling project that was allegedly overseen by executives from Veco Corp., an energy services company. Veco's former chief executive, Bill J. Allen, and another executive have pleaded guilty to paying more than $400,000 in bribes to members of the state legislature, several of whom have been indicted, and other unnamed elected officials.

Both executives are cooperating with investigators. Contractors have told reporters that they gave documents and testimony to federal grand juries in Anchorage and Washington about the remodeling project, which more than doubled the house's square footage by adding a new ground floor. Some contractors have said Allen and Veco executives oversaw the remodeling project, but Stevens told local reporters two weeks ago that he paid every bill he received.

An energy company attorney declined to comment on whether Allen controlled the invoices for the home project, citing the investigation. "[The home] is certainly a part of the overarching investigation," said Amy Menard, outside counsel for Veco.

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