Sen. Stevens found guilty of corruption

WASHINGTON (Reuters) - Sen. Ted Stevens of Alaska was convicted of corruption on Monday, a verdict that could endanger the Republican's political future and help Democrats expand control of the Senate in the November 4 election.

Stevens, 84, was convicted on all seven counts of lying on Senate disclosure forms by failing to report more than $250,000 in home renovations and other gifts from an oil executive.

Stevens vowed to return to Alaska on Wednesday and resume campaigning. "I will fight this unjust verdict with every ounce of energy I have," he said in a blistering statement issued after the verdict.

"I ask that Alaskans and my Senate colleagues stand with me as I pursue my rights. I remain a candidate for the United States Senate."

Alaska Gov. Sarah Palin, the Republican vice presidential candidate who casts herself as a reformer, called the verdict a blow against corruption in Alaska.

"The verdict shines a light on the corrupting influence of the big oil-service company that was allowed to control too much of our state. That control was part of the culture of corruption I was elected to fight. And that fight must always move forward regardless of party or seniority or even past service," Palin said in a statement.

Stevens has been one of the Senate's most powerful Republicans, using his authority to steer billions of dollars of federal spending to his home state.

He is known for his proposed "Bridge to Nowhere," which became a symbol of out-of-control "pork barrel" spending. The now-abandoned project would have linked the town of Ketchikan to its island airport at a cost of $398 million.

Stevens, who had testified in his own defense, showed a fixed frown as he silently left the court. "I am innocent," he said in the statement. He accused Justice Department prosecutors of misconduct and acting in an "unconscionable manner."

LONG SENTENCE UNLIKELY

He faces up to five years in prison on each of the seven counts. Under federal sentencing guidelines he would likely receive much less prison time or only probation.

Matthew Friedrich, acting head of the Justice Department's criminal division, said the agency was proud of its prosecutors and that jury's decision showed they had proven their case.

"The investigation continues, as does our commitment to holding elected officials accountable when they violate our laws," he told reporters.

Stevens was indicted as part of a wide-ranging probe into public corruption in Alaska. His fellow Republican, U.S. Rep. Don Young, is also under investigation.

Stevens is the Senate's longest-serving Republican, at 40 years. He was popular in Alaska before the trial but is now in a tight re-election battle with Anchorage Mayor Mark Begich.

"This makes it more difficult," for Stevens, said Nathan Gonzales of the nonpartisan Rothenberg Political Report. "Still, I wouldn't count Stevens out because he is an icon in the state."

News of the verdict broke as Stevens was appearing via prerecorded television statements in a live debate with Begich, Young, and Young's Democratic challenger, Ethan Berkowitz.

DEMOCRAT CONTROL

The loss of Stevens' seat could help Democrats control 60 seats in the 100-seat chamber, enough to overcome potential Republican roadblocks.

He was the first sitting senator on trial since 1981, when New Jersey Democrat Harrison Williams was convicted of bribery.

The Senate could vote to expel a convicted felon with a two-thirds vote, but no action is expected before next week's election. Since 1789, the Senate has expelled only 15 members.

Prosecutors charged that Bill Allen, the former head of oil-services firm VECO Corp., provided extensive home renovations for Stevens' house in the ski-resort town of Girdwood, near Anchorage. Allen and others also provided gifts including a $2,700 massage chair, a $29,000 fish sculpture, stained-glass artwork, a gas grill and furniture.

Stevens called his former friend a liar. He said his wife oversaw the renovations and thought she had paid for them. He said the massage chair and other items were either unwanted or loaned, not given, to him.

(Additional reporting by Thomas Ferraro, Jeremy Pelofsky in Washington and Yereth Rosen in Anchorage; Editing by David Alexander and Eric Walsh)