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Feds question bookkeeper in Stevens case

A Senate clerk who helped maintain Sen. Ted Stevens' personal financial records was recently called before a federal grand jury in a public corruption investigation that has been joined by the IRS and the Interior Department.
/ Source: The Associated Press

A Senate clerk who helped maintain Sen. Ted Stevens' personal financial records was recently called before a federal grand jury in a public corruption investigation that has been joined by the IRS and the Interior Department.

Barbara Flanders, who serves as a financial clerk for Stevens on the Commerce Committee, testified in the past several weeks and provided documents regarding the senator's bills, according to an attorney in the case who spoke on condition of anonymity because grand jury matters are secret by law.

Investigators are scrutinizing Stevens' relationship with oil field services contractor Bill Allen, who helped oversee a complicated renovation project that more than doubled the size of Stevens' home in 2000. Allen's company, VECO Inc., won tens of millions of dollars in federal contracts. Allen has pleaded guilty to bribing Alaska lawmakers.

Federal agents raided Stevens' home Monday, photographing and videotaping its contents and leaving with a garbage bag full of unidentified items.

Stevens, 83, is the longest-serving Republican in Senate history. He has denied any wrongdoing and said he paid for all the improvements himself but he says he worries the looming investigation could have political consequences.

Flanders is a longtime aide who helps ensure that Stevens' bills are paid and his personals affairs are in order, the attorney said. She was questioned about the improvement project and how the bills were paid.

Reached by telephone Tuesday, Flanders would not discuss her testimony or describe her duties involving Stevens' personal accounts.

"I work for the Commerce Committee," she said. "I don't have any comment on any other issues."

Jenilee Keefe, a spokeswoman for Committee Chairman Daniel Inouye, D-Hawaii, said there was no evidence the subpoena involved committee business.

"It is a personal thing. She worked for him in another capacity," Keefe said. "Right now we're just not getting involved."

Spokesmen for Stevens had no comment on the subpoena or Flanders' role in the senator's personal finances.

The investigation grew out of a lengthy corruption probe that has ensnared several Alaska lawmakers and resulted in Allen's guilty plea for bribery. Only recently, however, have authorities turned their focus on Stevens and that focus appears to be narrowing.

The Interior Department's inspector general and the Commerce Department have also joined the case to investigate Stevens' connections with a Seward, Alaska, marine science organization that operates the Alaska SeaLife Center, a person familiar with the probe said on condition of anonymity because it is ongoing.

Among many items photographed in Monday's search were cases of wine stored in Stevens' house. Investigators photographed each case and the individual bottles, the attorney said.

About 15 agents took photos and video of various angles of the structure, climbing onto the roof at one point, and eventually entered. They later carried out a garbage bag full of unidentifiable materials and loaded it into an unmarked white van. The curtains were drawn during most of the search.

Investigators did not raid Stevens' home in Washington, where he spends most of his time.

An e-mail statement issued by Stevens through his Washington, D.C., spokesman said federal agents had alerted his attorneys that they wanted to search his home. Stevens, who has been in office since 1968, said the interests of justice would be best served if he commented after the investigation.

"I continue to believe this investigation should proceed to its conclusion without any appearance that I have attempted to influence its outcome," Stevens said. "The legal process should be allowed to proceed so that all the facts can be established and the truth determined."

Stevens Investigation
The Girdwood, Alaska, home of U.S. Sen. Ted Stevens, R-Alaska, is seen Thursday, June 7, 2007. Agents from the FBI and Internal Revenue Service on Monday, July 30, 2007, searched the home of Stevens, an official said.Al Grillo / AP

Located 40 miles south of Anchorage, Girdwood is nestled in a valley next to Mount Alyeska and has evolved from a gold mining town into Alaska's only year-round resort community.

Congressional watchdog groups called for Stevens to step down — at least temporarily — from his posts on the Senate's Commerce and Appropriations committees.

"There is growing evidence that Sen. Stevens may have used his powerful perch on the appropriations committee to direct tens of millions of dollars of earmarks to benefit family, friends, business partners and former staff," said Ryan Alexander, president of Taxpayers for Common Sense. She commented in a letter to the Senate's Republican leader, Mitch McConnell of Kentucky.

McConnell has not said whether he would ask Stevens to temporarily relinquish his committee assignments.

Citizens for Responsibility and Ethics in Washington, a liberal watchdog group, called it "imperative that no member under federal investigation be involved in the oversight or appropriations of any agency involved in investigating that member."

The group referred to Stevens' membership on the Appropriations subcommittee that funds the Justice Department.

The Justice Department's probe into Allen's relationships has led to charges against state lawmakers and contractors. Last year, FBI raids on the offices of several Alaska lawmakers included Stevens' son, former Alaska Senate President Ben Stevens.

Neither the U.S. senator nor his son has been charged.