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Murkowski chief of staff pleads guilty to fraud According to his plea bargain, Clark will assist feds in Alaska corruption probe, giving fuel to rumors of more indictments to come The Associated Press
Jim Clark — the man who represented former Alaska Gov. Frank Murkowski at the gas line negotiating table with ExxonMobil, BP and ConocoPhillips — has pleaded guilty to federal fraud charges. Clark, chief of staff for the former governor, told a federal judge March 4 that he hid more than more than $68,000 in campaign contributions from state regulators.
Considered the most powerful non-elected person in Alaska’s state Capitol when Murkowski was governor, Clark told reporters that the former governor never knew of his sleight-of-hand deals to hide campaign contributions from state regulators.
“He trusted me to do things the right way, and I didn’t,” he said.
It’s quite a fall for Clark, a man never afraid to wield his extensive political clout to his advantage, but now ensnared in a wide-ranging federal corruption probe that has also touched state and federal lawmakers.
Clark’s downfall proved to be his backdoor dealings with VECO Corp. executives to get his boss re-elected in 2006, hiding campaign contributions to pay for polls and consultants in the failed bid for both men to keep their offices. Campaign laws prohibit such contributions.
Clark issued apology About 10 hours before Clark entered his plea March 4, he e-mailed The Associated Press a statement, in which he apologized six times.
“It is ethically and morally wrong for a public official to violate Alaska’s laws under any circumstance,” Clark wrote. “I should have drawn a line between my job and the campaign and simply left fundraising to the campaign fundraisers. No one is more aware of my inappropriate conduct than I am. For this I sincerely apologize to all Alaskans.”
The letter’s tone comes in stark contrast to the confident, polished man who spent four years walking the halls of the Capitol in Juneau doing much of the heavy lifting for Murkowski, who has been unavailable for comment.
Clark never minced words, said current and former lawmakers. Nor was he afraid to interrupt a House floor session by ringing Speaker John Harris’ podium phone.
Those kinds of calls are rare, but not unheard of. They don’t come from Gov. Sarah Palin’s administration, Harris said, but he added Clark’s calls didn’t change the course of any bill.
The news of Clark’s plea jarred memories of the man’s take-charge style that some say found him beholden to the powerful oil industry as well as loyal to his boss and longtime friend Murkowski.
Remembered for bullying tactics Former Democratic House Minority Leader Ethan Berkowitz, who served while Murkowski was in office, called the news tragic, but says he can’t forget what he called four years of bullying tactics.
“There was an unholy alliance of big oil, the Murkowski administration and the Republican operatives that treated the Legislature and state assets as their own private domain,” said Berkowitz, who is now running for Congress.
“They operated by threat instead of logic,” Berkowitz said. “You do better with people by persuading them, than when you try to bully them, but that’s what he did.”
Berkowitz said Clark once told lawmakers that if they didn’t pass a statewide sales tax, there would have to be cuts in social programs. And the hubris didn’t stop there, Berkowitz said. Even against the Legislature’s wishes, Murkowski bought a jet on the state’s dime so he could travel around Alaska and to the Lower 48 more quickly.
“Jim Clark told the Legislature what was what; the level of arrogance was astounding,” Berkowitz said. “They were out of touch with the whole machinery of government.”
Clark, who also is an attorney, assisted Murkowski in negotiations with North Slope oil producers Exxon, BP and ConocoPhillips on tax and royalty terms with hopes of getting a gas pipeline built.
VECO executives Bill Allen and Rick Smith stood to benefit from a gas line project and courted a handful of lawmakers to advocate for industry friendly legislation. VECO was the oil field services company founded by Allen.
The gas line contract negotiated by Clark was not approved by the Alaska Legislature, with much of the criticism of the document generated by former Murkowski gas team members who were either fired by the governor or quit before the contract was finalized. Among those individuals were Alaska Department of Natural Resources Commissioner Tom Irwin and DNR Deputy Commissioner Marty Rutherford. Both Irwin and Rutherford were brought back to DNR by the current governor, Sarah Palin, and are part of Palin’s gas line negotiating team.
Both Allen and Smith pleaded guilty to federal charges last year for bribing Alaska lawmakers in the ongoing federal investigation, which also has touched U.S. Sen. Ted Stevens, the longest serving Republican in the Senate.
Stevens is being investigated for a remodeling project at his home in Girdwood, a ski resort community on Anchorage’s southern edge. Allen has testified that he sent VECO employees to work on the house.
Beyond saying he’s paid every bill presented him for the remodeling project, Stevens will not comment on the investigation.
U.S. Rep. Don Young, R-Alaska, is also the subject of a federal investigation that includes his campaign finance practices. Young’s re-election campaign last year spent $854,053 on legal fees, but he won’t disclose for what that money was used. Neither has been charged.
The probe became public in August 2006 when the FBI and other officials raided the offices of six state lawmakers.
Since then, two former Republican state lawmakers have been convicted in federal court of accepting bribes from VECO.
Former House Speaker Pete Kott is serving his sentence in a federal prison in Oregon; former Rep. Vic Kohring awaits sentencing; former Rep. Bruce Weyhrauch awaits trial.
Additionally, former state Senate President Ben Stevens and state Sen. John Cowdery remain under investigation. Neither has been charged. Ben Stevens is Ted Stevens’ son.
The probe apparently continues, and with the cooperation of Allen and Smith.
In January, federal prosecutors asked that their sentencings be delayed because a substantial amount of work remains in the government’s investigation. The next status report is due by April 30 to a federal judge.
Clark to assist federal investigation And now Clark, too, will be assisting the feds in the investigation, according to the terms of his plea agreement.
This leaves many political insiders wondering if there may be more indictments.
“In the center of the spider web, I think the one person you’ll find there has got to be Jim Clark,” Senate Minority Leader Gene Therriault said.
“Whatever coordination and discussions were going on between the House, Senate and VECO members, Jim would be involved in some of those conversation,” said the North Pole Republican.
Clark is specifically charged with conspiring with VECO to have the company pay approximately $68,550 for consultant and polling fees toward Murkowski’s re-election bid.
Clark knew this was illegal because it was not permissible under elections laws for VECO to make these payments.
He faces a sentence of up to five years in prison and a fine up to $250,000. Sentencing was set for Sept. 4.
—Petroleum News contributed to this article
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