Big Arm man sentenced for corruption

By NICHOLAS LEDDEN/Daily Inter Lake

A Big Arm businessman tied to corruption in Alaska state government has been sentenced to six months in federal prison for bribery and conspiracy convictions.

During a hearing Wednesday in U.S. District Court in Anchorage, William C. Weimar, 68, also was ordered to serve six months of home confinement and pay a $75,000 fine.

He is scheduled to surrender to authorities in early January.

Weimar was convicted in August of illegally funneling money to a political consultant for an Alaska state Senate candidate in the 2004 primary, knowing the candidate would back a private prison if he won.

Had the private prison won legislative approval, Weimar would have stood to realize a $5.5 million "contingent interest" in the project, according to federal court documents.

Weimar was the 11th person charged in the broad, ongoing investigation by the FBI and U.S. Department of Justice into political corruption in Alaska.

Citing the ongoing probe, department officials declined to comment on the case.

The former owner of Allvest Inc., a corrections services company that once operated halfway houses in Alaska, Weimar now lives in Big Arm along the west shore of Flathead Lake.

Allvest, which at one time had government corrections contracts worth $10 million per year, went bankrupt in 2002 because of judgments in civil suits against the company.

Weimar in 2002 organized a new company, Weimar Investments, and registered it with the Montana Secretary of State. The company controls three 20-acre parcels of land near Big Arm, two of which have homes on them.

Also in 2002, Weimar bought the Homestead Cafe, Bar and Casino in Lakeside. He registered a second company, Lakeside Ventures, to control the restaurant.

In September, Weimar allowed ownership of the Homestead to revert to its founder, Cindy Hendrick.

In Montana, convicted felons can be denied the liquor and gambling licenses necessary to run a business such as the Homestead Cafe, Bar, and Casino.

"It was shocking that I got it back," said Hendrick, who had embarked on a new career path after her business sold. "It's back to what it used to be."

Hendrick, who founded the Homestead Cafe in 1989, reopened it on Nov. 1 after a monthlong remodeling.

During his August change-of-plea hearing, Weimar admitted sending the unnamed Alaska state Senate candidate's campaign consultant $20,000 without reporting the payments to the state election commission and without routing them through the campaign.

While the indictment doesn't identify the candidate or the consultant, the candidate appears to be a former Alaska legislator elected in 1996 and 2000 with whom Weimar had a "long-standing" relationship, court records say.

The candidate, who had a record of supporting Allvest's private prison projects, lost his seat in 2002 and was trying to regain it in 2004 - but lost in the Republican primary.

Some of the candidate's largest campaign expenses in 2004 were more than $43,000 in fees charged by an advertising and public relations firm based outside Seattle.

Court documents quote details from a number of telephone conversations Weimar had with the consultant and the candidate from Aug. 17 to Aug. 23, 2004.

In a conversation on Aug. 17, 2004, the consultant told Weimar that the campaign was having money trouble, court documents say.

"I'm worried we're reaching the limit now. I don't know where we find 10 grand unless [the candidate] can get more in," the consultant said.

"There's no legal way to do that. At least not on that scale," Weimar responded.

Later that day, Weimar arranged to cover the candidate's next advertising mailer and told the candidate he would do so, court documents say.

On Aug. 20, 2004, Weimar told the candidate about an outstanding $20,000 invoice the candidate had with the consultant. But the candidate's campaign funds were depleted and he had only $300 to $400 left in his account.

On Aug. 23, 2004, Weimar made arrangements with the consultant to pay off the debt, court documents say. He then called the candidate and told him "he would not be receiving any further bills from [the consultant]."

Weimar sent the consulting company a $3,000 check on Aug. 23, 2004. Later that same day sent $8,500 in cash drawn from a Polson bank and another $8,500 - again in cash drawn from the Polson bank - the following day, court documents say.

Pursuant to a plea bargain, Weimar pleaded guilty to conspiracy to commit honest services mail and wire fraud and illegally manipulating currency transactions to avoid U.S. Treasury Department reporting rules, both felonies.

One of the goals of the conspiracy was to get the company proposing the private prison in which Weimar had the $5.5 million stake to also make campaign contributions to the candidate, court documents say.

That company had proposed several private prison projects across Alaska, including additional halfway houses and a juvenile treatment facility. In 1998, the Texas-based company bought five halfway houses from Weimar's Allvest for $21 million.

Also implicated in the far-reaching federal investigation into political corruption in Alaska were several Alaska state legislators, lobbyists, top executives of the oil field services firm Veco Corp., and U.S. Sen. Ted Stevens, R-Alaska.

Stevens was convicted last month of seven felony corruption charges for accepting a bonanza of home renovations from VECO Corp. executives and then lying about it.

The Anchorage Daily News contributed to this report.

Reporter Nicholas Ledden can be reached at 758-4441 or by e-mail at nledden@dailyinterlake.com