Alaska Attorney General Dan Sullivan said Thursday that state prosecutors are examining sex abuse allegations against former Veco Corp. chief Bill Allen, revitalizing a case that the U.S. Justice Department recently decided not to pursue.
Allen, 73, was the key witness in a string of Alaska political corruption cases. The decision by top Justice Department officials not to prosecute Allen on sex charges didn't sit well with Anchorage police and one of his alleged victims, a young woman who said she first had sex with Allen when she was a 15-year-old prostitute in Spenard.
No one at the Department of Law, including the Anchorage district attorney, knew about the woman's allegations before they were detailed in an Aug. 21 Daily News story, Sullivan said.
"I can tell you that we were just as concerned about this case as anyone else who read that article," Sullivan said.
Anchorage police had been working with a trial attorney in the federal Child Exploitation and Obscenity Section in Washington, D.C., for two years. Investigators on the teen's case said the prosecutor and his supervisor supported taking it to a federal grand jury, but they were overruled. Police were given no explanation.
"Everyone expected the case to go federal. And that was it," said police Lt. Dave Parker, explaining why police didn't go to state prosecutors initially.
Sullivan's comments came during a press briefing Thursday related to threatened Steller sea lions. He was asked whether the state intended to pursue a case against Allen and was ready with a written statement.
"A team from the criminal division at the Department of Law met with the (Anchorage police) investigators last week," Sullivan said in his statement to reporters. "We also have obtained the police file and investigative report concerning this case and are reviewing it."
He didn't take questions and said he couldn't comment further "given that this an ongoing criminal investigation."
The case involves allegations of sexual misconduct against Allen by Paula Roberds, who is now 26. She has agreed to have her name used publicly.
She underwent multiple interviews with Anchorage police, FBI agents and prosecutors, telling the story of how Allen flew her from Seattle to Anchorage about five times for sex when she was 16, paying her thousands of dollars each time. She first 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 has enhanced penalties when the victim is a minor.
There is no similar state crime. But under state law, it's a crime for an adult to have sex with someone under age 16.
Anchorage police first began investigating Allen on child sex abuse charges in early 2004 but initially were waved off by the U.S. Attorney's office in Anchorage because of a separate sex trafficking and cocaine investigation involving millionaire hardware store owner Josef Boehm of Anchorage. One of the reported victims of Allen was a defendant and key witness in the Boehm case.
In 2006, Allen became a government witness in the federal corruption cases. When Roberds surfaced in 2008 with sexual allegations against him, the U.S. Attorney's office in Anchorage directed police to the Justice Department in Washington because of the apparent conflict of interest, U.S. Attorney Karen Loeffler said Thursday.
"If there are allegations, we are not going to stand in the way of them at all," said Loeffler. "We made sure that if somebody asked for a federal prosecutor to look at it, that that happened."
All the decisions on whether to prosecute Allen on federal sex charges were made in Washington, and the Anchorage office wasn't involved, she said.
In 2007, Allen pleaded guilty to bribing Alaska state lawmakers and in January began serving a three-year sentence in federal prison. With time off for good behavior, he's expected to be released in August 2012.
He also was the government's star witness in the federal corruption trial of the late U.S. Sen. Ted Stevens. Stevens' conviction was later thrown out because of prosecutorial misconduct.
Find Lisa Demer online at adn.com/contact/ldemer or call 257-4390.
By LISA DEMER
ldemer@adn.com