Scandal tarnishes oil firm

WASHINGTON – For years, while VECO Corp. was flush with oil profits and in a giving mood, Capitol Hill politicians happily accepted hundreds of thousands of dollars in campaign donations from employees of the Alaska oil contractor.

But now that two Alaska lawmakers are under FBI scrutiny as part of a growing corruption scandal involving VECO, the friendly feelings have faded and some in Washington are shedding the campaign donations connected with the company.

VECO founder Bill Allen and former company Vice President Rick Smith have pleaded guilty to bribing public officials. They also admitted running a company “special bonus program” that steered money to favored candidates, violated federal tax laws and sent untold amounts of corporate money into political coffers.

Testifying recently at a corruption trial in Anchorage, Alaska, Allen said his generosity was aimed at oil-friendly lawmakers and candidates. “If they’re working with the oil industry, I’d like to help with their campaigns,” he said.

From 1993 until the FBI approached them last year, Allen and Smith donated more than $200,000 to federal political causes. Their employees donated twice that amount, according to an analysis of campaign finance data from the Federal Election Commission and the nonpartisan Center for Responsive Politics.

At least some of that money came from the special bonus program, which experts say appears to violate campaign finance laws. But the Justice Department, which has all of VECO’s records, has so far revealed few details about when the program began or who benefited from it.

That leaves several candidates, from Alaska to the White House, unclear about sizable donations.

“We don’t know anything more about this so-called special bonus program than we’ve read in the newspaper,” said Timothy McKeever, the campaign treasurer for Sen. Ted Stevens, R-Alaska.

Stevens, who is under federal investigation because VECO employees helped renovate his house, donated to a veterans charity $18,000 his campaign received from Allen and Smith, McKeever said. The senator plans to keep more than $50,000 from VECO employees.