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Jury Convicts Two in Alaska North Slope Corruption Trial

May 23, 1989

ANCHORAGE, Alaska (AP) _ The racketeering convictions of two powerful North Slope officials should put an end to the days of feasting on oil-bloated public works projects in the state, a federal prosecutor says.

A federal court on Monday convicted lobbyist Lewis Dischner and consultant Carl Mathisen in Alaska’s longest criminal trial.

The advisers to former Borough Mayor Eugene Brower used their positions to pocket millions in kickbacks and steer construction contracts to companies they secretly owned, the trial showed.

Prosecutors said payments to Dischner and Mathisen added $73 million to the cost of the massive contruction program in the early 1980s aimed at providing 20th Century comforts for the nation’s northernmost communities.

The North Slope borough is the Eskimo-led government of the vast northern region of Alaska.

Dischner, 71, was convicted on 21 charges, ranging from racketeering to extortion to wire and mail fraud. Mathisen, 56, was convicted on 22 similar charges. The jury acquitted Dischner on four income tax counts.

″We’re obviously pleased,″ said U.S. Attorney Michael Spaan. ″We hope that it will change the way that business is done in Alaska.″

The complex trial lasted more than seven months. The verdict came in the fourth week of deliberations by an 11-member jury. One juror was dismissed after being hurt in a horseback-riding accident.

Prosecutors said Dischner and Mathisen socked away $21 million during Brower’s administration from 1981 to 1984 - $3 million in salaries; $9 million from contracts and $9 million from a 10 percent fee assessed all companies doing business with the borough.

The government claimed Dischner and Mathisen manipulated Brower, an inexperienced leader whom they had helped elect. Brower testified for the government as part of plea-bargain that included a 30-day sentence and a $5,000 fine for tax evasion.

Defense lawyers attributed the inflated cost of the borough’s capital construction to harsh arctic conditions, a rush to finish the work and the Brower administration’s desire to create jobs.

Federal racketeering statutes under which Dischner and Mathisen were prosecuted allow the government to seek forfeiture of money and property obtained illegally.

Lawyers for the pair said they will appeal.

Sentencing was scheduled for August or September. Dischner and Mathisen will remain free on personal recognizance until then, said U.S. District Judge H. Russel Holland.

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