McGavick returns donations from oil firm that FBI is investigating

Republican U.S. Senate candidate Mike McGavick has returned $14,000 in campaign contributions from employees and executives of an Alaska oil-field services company at the center of a federal investigation.

VECO, one of Alaska's most powerful political players, emerged as a focus in the investigation that became public when the FBI raided offices of Alaska lawmakers last week.

VECO employees have been generous donors to McGavick's campaign for the seat held by Sen. Maria Cantwell, D-Wash. They rank 10th in a list of donors to the campaign ranked by employer, according to the Center for Responsive Politics. The center's Web site showed $12,000 had been given to McGavick by VECO Chairman Bill Allen, President Pete Leathard and other VECO employees. Another $2,000 came from another VECO executive, said McGavick spokesman Elliott Bundy.

"As soon as word of the FBI investigation in Alaska broke, the campaign returned all contributions from employees of VECO. While the exact subject and people at the heart of the investigation have not been announced, Mike wanted to err on the side of caution," Bundy said.

The money was returned Friday, the day after the FBI raided the offices of at least six members of the Alaska Legislature. According to a copy of a search warrant obtained by The Associated Press, the FBI was looking for documents about contracts, agreements or employment provided by VECO or three of its executives.

VECO officials did not return a telephone call to their Anchorage headquarters.

Allen and his company have long been big supporters of Republicans in the Alaska Legislature and in key congressional spots. That includes U.S. Sen. Ted Stevens, R-Alaska, a prominent McGavick backer, whose son, Ben, is president of the Alaska Senate and whose office was searched by the FBI. Ben Stevens reportedly has collected more than $240,000 in consulting fees from VECO since 2000.

Ted Stevens helped organize a fundraiser for McGavick in Alaska in April that brought in the bulk of the VECO money returned last week. Allen was among the co-sponsors.

Stevens' help came after Cantwell stymied his plans to open the Arctic National Wildlife Refuge to oil drilling. McGavick supports Stevens' plan.

The state Democratic Party on Tuesday, not knowing McGavick had already returned the money, issued a news release calling on him to "dump dirty money" from VECO. But even after learning of the returned contributions, the party criticized McGavick for accepting other support from the oil industry.

Democrats also have faced the question of what to do with contributions associated with controversy. At the time of the Jack Abramoff scandal, in which the lobbyist eventually pleaded guilty to bribing public officials, Cantwell first said she wouldn't return money from clients associated with him.

She later donated to a Native American charity about $17,865, which included, an aide said, "any funds from organizations or individuals that have ever been connected to Abramoff based on media reports."

U.S. Sen. Patty Murray, though, kept the $35,000 in campaign donations she got from tribal clients of Abramoff, saying at the time, "I will not rush to scapegoat those tribes who have already been victimized by Jack Abramoff."

Staff reporters Alex Fryer and Hal Bernton contributed to this report. David Postman: 360-236-8267 or dpostman@seattletimes.com