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Derby winner's owner has ties to Alaska bribery scandal

ANCHORAGE — If it weren't for the plea deal that his dad, former Veco chief executive Bill Allen, made with federal prosecutors, Mark Allen might not have been in the winner's circle Saturday at the Kentucky Derby, celebrating the victory of his thoroughbred Mine That Bird and a $2 million purse.

Bill Allen, in pleading guilty in 2007 to three counts related to his central role in the Alaska public corruption scandal, won immunity from federal criminal charges for Mark Allen.

Mine That Bird, a 50-to-1 long-shot, stunned the racing world when he came from behind and won the Derby, America's premier thoroughbred event. Mark Allen's Double Eagle Ranch of Roswell, N.M., along with a neighbor, Leonard Blach, purchased the gelding last year. The racing Web site said they paid $400,000 after the horse had initially sold for $9,500 as a yearling.

While prosecutors haven't said whether they could have charged Mark Allen, Bill Allen himself has testified that his son paid off a state legislator. A felony conviction against Mark Allen would have led to revocation of his license as a racehorse owner in New Mexico, racing officials there said.

Under Bill Allen's plea deal with the Justice Department, he was required to cooperate fully with the government and provide "substantial assistance to the ongoing investigation." In return, the government agreed to "not charge Allen's son, Mark Allen, or other family members of Allen with any criminal offenses arising out the government's investigation that have been disclosed to the government."

Bill Allen's testimony about his son’s payoff to a legislator came in October during the trial of former U.S. Sen. Ted Stevens. While Allen was under orders by the judge in the case to not name any legislators who received Veco or Allen money &mash; one would have been former state Sen. Ben Stevens, Ted's son, and the judge wanted to avoid prejudicing the jury — Allen used the pronoun "her" to describe the legislator paid by Mark.

In March, former Rep. Bev Masek pleaded guilty to conspiracy to commit bribery for accepting at least $4,000 from Allen. Among the overt acts listed in the conspiracy charge was that a "relative" of Bill Allen — the name wasn't given — gave her "several" thousand dollars in cash at a restaurant in South Anchorage on April 18, 2003, after she complained to Allen that she was broke.

"Masek accepted this money knowing that Veco and its (oil-company) clients had matters pending before the Alaska State Legislature that were important to Allen and Veco's business interests," the charge against Masek said.

Two weeks later, Bill Allen himself bribed her with $2,000 to spike a bill that would have raised oil taxes, according to her plea.

Bill Allen’s testimony played a strong role in the convictions of two former state legislators accused of bribery, and he was the government’s chief witness against Stevens. Lawyers for Stevens argued that Allen had an incentive to lie in his testimony to ensure the government would keep the bargain and not charge Mark.

Veco Corp. itself has also not been charged, though Allen said he was told by prosecutors that such a charge remains an option. Allen and his three grown children, owners of most of Veco stock, sold the company to the international engineering firm CH2M Hill in 2007. According to sales documents, Mark Allen’s share, before taxes, was about $30 million.

The Anchorage Daily News reported last summer that Mark Allen went on a horse-buying spree starting in 2007. He spent nearly $726,000 for eight horses at the Ruidoso Select Quarter Horse sale in New Mexico that August, one of the breed’s premiere events. His Double Eagle Ranch paid the highest price for any horse at that sale — $460,000 for a colt.

Bill Allen has testified that although he tried to interest his son in Veco, it didn’t work out.

"He didn’t like it," Allen said in the Stevens trial. "He wanted to get back with his horses."

The family had a horse ranch in Grand Junction, Colo., then Mark bought a place in Roswell which he owned with his wife, Peggy. The couple is divorcing.

An older half-brother of Mine That Bird, So Long Birdie, initially belonged to a partnership that included Mark and Bill Allen, Stevens, Double Musky restaurant owner Bob Persons and other prominent Alaskans. Persons said last year that the Allens had bought So Long Birdie from the partnership. The horse stands at stud at Blach’s Buena Suerte Equine Clinic, near the Double Eagle Ranch.

In an interview in July, Blach, who shared the winner’s circle with Allen Saturday, claimed to not be very familiar with Mark Allen.

"I see him once in a while," Blach said then. "I just don’t know too much about him, to tell the truth about it." (Blach told reporters on Saturday that he and Mark Allen have "been friends for years.")

Chip Woolley, Mine That Bird’s trainer from Farmington, N.M., was also reluctant to speak about Mark Allen when contacted in July.

"If you got questions about him, you need to call him," Woolley said. "If you want to ask questions about Mark’s horses, call him. You don’t even know me or nothing about me, so, well I don’t know you or nothing about you."

Mine That Bird indirectly figured into one of the strangest events in the Stevens trial. After the jurors began deliberating, one of them, Marian Hinnant, suddenly skipped town. Initially she told the judge her father had died, but then admitted she had a ticket to see the Breeders Cup, a major thoroughbred stakes race Santa Anita Park near Los Angeles.

Mine That Bird, recently purchased by Allen and Blach, ran in the Breeders Cup Juvenile as two-year-old. In that race, Mine That Bird was true to form — he was a 30-to-1 long shot and came in 12th.

Hinnant was replaced by an alternate, who later blogged about her experiences. Before the Stevens case was thrown out for prosecutorial errors, Stevens’ defense cited Hinnant and the blogger as reasons a new trial was warranted.

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