SENATE JUDICIARY COMMITTEE March 30, 1998 1:45 p.m. MEMBERS PRESENT Senator Robin Taylor, Chairman Senator Mike Miller Senator Sean Parnell Senator Johnny Ellis MEMBERS ABSENT Senator Drue Pearce, Vice-Chairman COMMITTEE CALENDAR SENATE BILL NO. 329 "An Act establishing an exemption for investment clubs from the business license requirement." - MOVED CSSB 329 FROM COMMITTEE HOUSE BILL NO. 321 am "An Act relating to trusts, to the prudent investor rule, and to standards of care applicable to personal representatives, conservators, and trustees; and providing for an effective date." - MOVED HB 321 am PREVIOUS SENATE COMMITTEE ACTION SB 329 - See Labor and Commerce minutes dated 3/12/98. HB 321 - No previous action to report. WITNESS REGISTER Mr. Kenneth Norsworthy Special Counsel to the Senate Judiciary Committee 711 H Street, Suite 510 Anchorage, Ak 99501 POSITION STATEMENT: Presented information to the committee on the APSIN inquiry Representative Joe Ryan State Capitol Juneau, Ak 99801-1182 POSITION STATEMENT: Presented HB 321 Mr. Dick Thwaites 500 L St. suite 301 Anchorage, Ak 99501 POSITION STATEMENT: Supported HB 321 Mr. Floyd Dameron 2430 Foxhall Drive Anchorage, Ak 99504 POSITION STATEMENT: Supported SB 329 Ms. Annette Kreitzer Staff to Senator Loren Leman State Capitol Juneau, Ak 99801-1182 POSITION STATEMENT: Presented SB 329 Ms. Catherine Reardon Director, Division of Occupational Licencing PO Box 110806 Juneau, Ak 99811-0806 POSITION STATEMENT: Supported SB 329 ACTION NARRATIVE TAPE 98-24, SIDE A Number 001 CHAIRMAN ROBIN TAYLOR called the Judiciary Committee meeting to order at 1:45 and brought up HB 321 am as the first order of business. HB 321 - UNIFORM PRUDENT INVESTOR ACT REPRESENTATIVE JOE RYAN, prime sponsor of HB 321, said the bill removes restrictions on trusts and trustees and allows for the implementation of modern portfolio management techniques. REPRESENTATIVE RYAN said the bill is endorsed by the American Bar Association, the American Bankers' association and has already been adopted in 20 other states. CHAIRMAN TAYLOR commented that, historically, through neglectful management, the state of Alaska was held liable for not following the prudent investor standard and investing in junk bonds. Consequently, the state had to put up some $30 million and only recovered a portion of this. CHAIRMAN TAYLOR asked if this bill changes the prudent investor standard that has always been in effect in Alaska. Representative RYAN said HB 321 is based on the responsibility of a trustee, and gives a trustee the authority to delegate investment management. The trustee is allowed to use a sophisticated risk return analysis to guide important decisions and REPRESENTATIVE RYAN suggested this would preclude the type of situation CHAIRMAN TAYLOR had referred to, as the trustee would have delegated the management authority to a professional investment manager. MR. DICK THWAITES, an attorney specializing in estate and gift taxes testified via teleconference from Anchorage. MR. THWAITES indicated the bill closely follows the National Conference of Commissioners on Uniform State Law, covering both trusts and estates and unifies investment standards required of trustees. MR. THWAITES said the bill can be likened to the Uniform Commercial Code, in that it standardizes things and will make our state standards easier to understand. Number 115 SENATOR PARNELL referenced page 3, line 9 which reads, "a trustee shall make a reasonable effort to verify facts relevant to the investment . . . " SENATOR PARNELL asked if this increases the standard of care from the existing law. MR. THWAITES said the standard will remain the same but the trustee must be a knowledgeable one, considering and serving the specific needs of their beneficiary. He said it will allow trustees to employ fund managers to help meet this requirement. SENATOR PARNELL asked what the policy reason were for passing the bill. MR. THWAITES replied it makes the uniform law consistent with that of other states, provides a foundation for trustees that does not currently exist, unifies the terminology, and clarifies many of the questions of professional fiduciaries around the state. SENATOR PARNELL asked how many states have adopted the Uniform Prudent Investor Act and MR. THWAITES replied nineteen have adopted it, and it is pending in seven others as of 7/1/98. SENATOR PARNELL moved HB 321 am from committee with individual recommendations. Without objection, it was so ordered and CHAIRMAN TAYLOR called SB 329 as the next order of business. SB 329 - INVESTMENT CLUB LICENSE EXEMPTION Number 167 MR. FLOYD DAMRON, Co-President of the Alaska Council of the National Association of Investors Corporation, testified via teleconference from Anchorage. MR. DAMRON stated that SB 329 allows investment clubs to be exempt from getting a business licence. He said there are 36,000 investment clubs around the United States. MR. DAMRON said these clubs are not a business and their general purpose is to provide education about investing in the U.S. Stock Market. MR. DAMRON noted that the financial impact of this bill is zero. Number 200 Ms. Annette Kreitzer, Staff to the Senate Labor and Commerce Committee, said the proposed committee substitute includes a clean up of language that was not included in the bill that passed out of the Labor and Commerce committee. Ms. KREITZER said the bill also includes a simplified definition of business. SENATOR PARNELL asked why the bill takes out the Commissioner of Commerce and Economic Development (CED). MS. KREITZER replied that the CED does issue some fisheries business licences to some fishing related businesses. Also, the drafter thought it was important to include, but the sponsor has no feeling on it. SENATOR ELLIS assumed the fiscal impact of the bill was negligible, and asked if any public protection was lost to consumers under this bill. MS. KREITZER said the fiscal note was zero and, as she understood it, there was no protection lost under the bill. MR. KREITZER added that no other state requires business licences for investment clubs. SENATOR ELLIS asked if the registration of investment clubs was a useful tool for other reasons. SENATOR PARNELL asked if the intent was to immunize or limit liability of investment clubs and Ms. KREITZER replied the intent was only to exempt them from the requirement of purchasing a business licence. Number 269 MS. CATHERINE REARDON, Director of the Division of Occupational Licencing under the Department of Commerce and Economic Development, testified that business licencing is essentially a tax and provides no public protection. Business are not investigated, and the division has no basis on which to deny a business licence. Ms. REARDON said there are currently 72,000 business licences held in Alaska, and the tighter definition will help her division by reducing the confusion of people calling and visiting their office. MS. REARDON said her division has no position on section one, added by the legislative drafter. She said section two gives the division regulation writing authority which she appreciates. She noted the zero fiscal note and commented that, actually, the state may lose approximately $250, but her office will work to offset this loss. SENATOR PARNELL asked if any investment clubs currently pay taxes, other than the cost of their business licences. MR. FLOYD DAMRON replied that investment clubs are formed as partnerships, in which each partner pays his or her taxes directly to the federal government. SENATOR MILLER moved the adoption of the committee substitute, version "B." Without objection, it was so ordered. CHAIRMAN TAYLOR announced he may have a potential conflict of interest, as his wife is in an investment club in Wrangell. SENATOR PARNELL moved CSSB 329 out of committee with individual recommendations. Without objection, it was so ordered. CHAIRMAN TAYLOR announced that the next order of business would be a report by MR. KEN NORSWORTHY, special counsel to the Judiciary Committee, on the Department of Public Safety's (DPS) investigation of unauthorized access to the Alaska Public Safety Information Network (APSIN). CHAIRMAN TAYLOR asked MR. NORSWORTHY for an overview of the report and asked him to explain how he received the material he based the report on. MR. NORSWORTHY stated that his report was the product of many months of review, beginning in January with initial interviews of the Commissioners of the Department of Public Safety (Mr. Otte) and Corrections (Ms. Pugh). MR. NORSWORTHY conducted these interviews to get an idea of what had transpired before he had become involved in the issue. MR. NORSWORTHY learned that in 1996 a number of state employees had run questionable accesses of the names of public officials on APSIN. APSIN stores criminal histories and other sensitive personal information. MR. NORSWORTHY said he immediately noticed that some people had the misconception that all the information available in APSIN could also be publicly accessed at a courthouse. MR. NORSWORTHY said the committee requested this inquiry after the 1997 election in which SENATOR JERRY WARD had some negative campaign ads directed against him that some suspected were the result of unauthorized access to APSIN. In response to this suspicion, Mr. Otte ran a targeted audit of APSIN to see if there had been any questionable access to SENATOR WARD's file prior to September 1996, when an article appeared in the Anchorage Daily News about SENATOR WARD's criminal history. Initially, nothing was found. A broader audit did find that SENATOR WARD's file had been accessed several times by APSIN users all over the state. A further request from Mr. Otte for an audit of the 18 months surrounding the 1997 election by the APSIN security officer (Ms. Mather) resulted in finding numerous suspicious accesses to the names of public officials, including legislators and city officials from Wasilla. MR. NORSWORTHY reported that the audit had come to the attention of the press and this brought more attention from public officials, some of who asked to be run in APSIN to see if their name had been accessed. At the end of this, in early May 1997, Mr. Otte reported to the Judiciary Committee that many suspicious accesses had occurred, but there was no indication of criminal conduct and some cases had been referred to the troopers for criminal investigation. Number 449 MR. NORSWORTHY spoke with Commissioner Otte in January 1997, after the criminal investigation had been completed, but before the completion of the screening by the Department of Law (DoL) to determine if there were to be any criminal prosecutions. MR. NORSWORTHY then interviewed the Commissioner of the Department of Corrections (DoC), Ms. Margaret Pugh. After these interviews, the Judiciary Committee decided that certain records of the audit and criminal investigation needed to be obtained in order to assist MR.NORSWORTHY's investigation. Mr. Otte and Ms. Pugh, along with Mr. Dean Guaneli and Ms. Kathleen Strasbaugh asked for a subpoena to be issued from the Judiciary committee in order to transmit these documents. These same people also indicated that if the committee wished to view confidential personnel files, they would like a signed contract assuring the committee would maintain the confidentiality of those records. Number 450 CHAIRMAN TAYLOR restated that, upon his initial interviews with DPS and DoC, they had suggested the committee utilize a subpoena to acquire the desired records. MR. NORSWORTHY replied they not only suggested it, but said they would not transmit the documents without a subpoena. CHAIRMAN TAYLOR asked if there were two classes of documents discussed with MR. NORSWORTHY, both of which would only be forthcoming with a subpoena to cover themselves for the conveyance of the documents. MR. NORSWORTHY replied that was correct. CHAIRMAN TAYLOR said the first type of documents were public, available under a freedom of information act request, and the second type of documents were confidential and would only be disclosed to the committee on receipt of a signed agreement ensuring confidentiality. CHAIRMAN TAYLOR understood that MR. NORSWORTHY had only received the first type of document. MR. NORSWORTHY agreed, but said he was not entirely sure that all the documents he received could have been obtained through a freedom of information act request. CHAIRMAN TAYLOR asked if other documents had been and remain withheld pending a contract of confidentiality from the committee and MR. NORSWORTHY replied this was correct and said he had advised the committee, due to the volume of information, to first look at those documents that did not require the confidentiality contract and then, if warranted, request the other documents. MR. NORSWORTHY said he was concerned that reviewing both public and confidential documents simultaneously might make it easier to accidentally breach confidentiality. Number 515 CHAIRMAN TAYLOR concluded that MR. NORSWORTHY had reviewed only the documents screened by the Department of Law and MR. NORSWORTHY replied that was correct. SENATOR PARNELL asked if MR. NORSWORTHY had reviewed any personnel records in preparing the report and MR. NORSWORTHY said, to the best of his knowledge, he had not. However, he said he would not be surprised if some of the documents he had reviewed would appear in some peoples' personnel files. MR. NORSWORTHY said he was provided with seven large boxes of documents, some of which were generated by the Department of Public Safety in their administrative review of the APSIN matter, and which may appear in certain personnel files. Number 534 MR. NORSWORTHY commented that the committee should know there is a substatute to A.S. 12.62 which prohibits making public the names of people who make certain accesses unless there are legal or judicial reasons for doing so. MR. NORSWORTHY noted that DoL did not cloak theses names and he is assuming they are not confidential. MR. NORSWORTHY said he cannot give a detailed summary of his report without naming names. CHAIRMAN TAYLOR said the committee was told at one time that these were closed police files, but was later told by Mr. Guaneli the files were available on a freedom of information act request. MR. NORSWORTHY remarked that he had been told he could access anything in the police files that had been closed and declined for prosecution, but could not access the information in the cases that were still ongoing. MR. NORSWORTHY said he ultimately got all the files, as they were all closed without prosecution. SENATOR PARNELL asked MR. NORSWORTHY if, to the best of his knowledge, the statements he made in his report were true and MR. NORSWORTHY replied, "absolutely." CHAIRMAN TAYLOR asked MR. NORSWORTHY if he was aware of any other restrictions that would make the information contained in his report unavailable to the committee and its staff and the public. MR. NORSWORTHY replied there was one thing: 13 of the files he focused on were appended with representative documents excerpted from the original files. In these files, the investigating trooper ran an APSIN check on the person who allegedly made unauthorized access and, in one case, that APSIN printout is included in the file and reveals potentially damaging information about this individual which is not directly related to this inquiry. TAPE 98-24, Side B Number 001 SENATOR PARNELL asked if any of this information was not generally available to the public. MR. NORSWORTHY replied the information exhibited in the report is available at the courthouse if you know where to ask for it. Number 567 CHAIRMAN TAYLOR said this is why he wanted to clarify exactly what was contained in MR. NORSWORTHY's report, and he did not propose to open to the public all the files they have received. MR. NORSWORTHY indicated that one of the suspects he discussed in the report had four criminal convictions and documents surrounding this are contained in the report. CHAIRMAN TAYLOR concluded there was nothing in the report that would be confidential and require a closed session, CHAIRMAN TAYLOR added he did not wish to go into a closed door session at any time, unless there was a legal reason to do so. MR. NORSWORTHY stated he knew of no legal reason requiring it. SENATOR MILLER moved that the report be accepted by the committee for review. SENATOR ELLIS objected and said there have been public employee representatives who have objected to the release of information potentially harmful to public employees. SENATOR ELLIS also asked if the motion covered only the report itself or included the other information in the possession of MR. NORSWORTHY. CHAIRMAN TAYLOR clarified that the motion applied only to the report, but SENATOR ELLIS maintained his objection. Roll was called and the motion passed 3 - 1 with SENATOR ELLIS dissenting. Number 536 MR. NORSWORTHY reviewed the objectives he initially set. First, MR. NORSWORTHY wanted to look at the troopers' investigations and the administrative inquiry in order to determine if any evidence of criminal violations had been uncovered. Second, MR. NORSWORTHY wanted to evaluate the adequacy of these investigations. Third, MR. NORSWORTHY wanted to look at the criminal screening decisions, considering all the cases had been declined for prosecution. MR. NORSWORTHY indicated that criminal screening meant the decision to prosecute a case or not. Fourth, MR. NORSWORTHY wanted to find out if there was any pattern to these acts that might suggest they were done for a political purpose. MR. NORSWORTHY wanted it understood that he did not limit his investigation to only looking for a political purpose behind these acts, as the law prohibits any personal use or benefit, not necessarily political. MR. NORSWORTHY also wanted to discover if any new evidence of criminal violations or political purposes could be found. MR. NORSWORTHY reviewed his findings and suggested that the troopers' investigations indicate there was some criminal conduct in association with these unauthorized APSIN accesses. MR. NORSWORTHY characterized the troopers' investigations as ineffective and inadequate and he believes the criminal screening was inadequate in some cases due to the quality of the investigative work, the legal interpretations of the applicable statutes, and the questionable analysis of the facts. MR. NORSWORTHY said the main factor hampering the criminal screening was the fact that the investigations were not sufficiently thorough. MR. NORSWORTHY said the circumstantial evidence of political use was very strong in two of the cases he reviewed, and, with a deeper probe, might have resulted in the discovery of further evidence. MR. NORSWORTHY indicated the audit by DPS resulted in 85 suspects, suspects being defined as a person who made an unauthorized APSIN access or made an access they could not explain. Without an obvious connection between the APSIN user and the individual they accessed, the matter would usually be dropped; however, this audit covered accesses of the names of legislators and other public officials. MR. NORSWORTHY indicated that troopers came across all kinds of admissions of accessing people for no authorized purpose, yet the troopers did not pursue these statements and there was no serious thought given to further investigation. MR. NORSWORTHY summarized by saying the list began with 85 questionable accesses (either admittedly unauthorized or with no plausible explanation) and DPS referred only 23 of these cases to the troopers for investigation, leaving 62 not investigated. MR. NORSWORTHY reported he could not determine why these investigations had been declined, nor could he determine what criteria had been used to select those cases that would receive further investigation. MR. NORSWORTHY received 23 cases, of which he dismissed 10, which seemed to be clearly motivated by curiosity. He then reviewed 13 cases in detail in his report, which appear to have possible criminal violations, and brought the supporting documentation in those cases with him to the committee. MR. NORSWORTHY said he chose these 13 cases due to his feeling that the suspect was lying in the trooper interview, using APSIN access for personal benefit, politically motivated, or all of the above. MR. NORSWORTHY noted that the investigation did not set out to focus on access made at the request of a third party, but this was revealed several times throughout the interviews. CHAIRMAN TAYLOR remarked that the committee had no way of knowing how they did their criminal screening process, and had no way of knowing if those they targeted were the worst or the least of the offenders. CHAIRMAN TAYLOR asked MR. NORSWORTHY to explain the meeting held with Mr. Guaneli and the troopers after the Joint Judiciary hearing last year. MR. NORSWORTHY first explained the three criminal provisions that could apply in these cases: official misconduct, misuse of confidential information, or criminal use of a computer. The first two of these statutes are misdemeanors and the third is a class C felony. MR. NORSWORTHY said during the collaboration of the troopers and the DoL attorneys leading the screening and prosecution on this case, a decision was made to focus on these first two statutes. The Department of Law explained to MR. NORSWORTHY that the third statute was interpreted only to cover "hacking," defined as an outside person with no authorized access whatsoever breaking and entering into a computer network. MR. NORSWORTHY did not read the statute this way, saying it does not necessarily immunize an authorized user making an unauthorized inquiry. CHAIRMAN TAYLOR asked if the statute specified the information had to be communicated to another party as a result of an unauthorized access and MR. NORSWORTHY replied that there was no language in the felony statute that required communication of any information, but the misdemeanor statutes were more open to interpretation. CHAIRMAN TAYLOR interjected that the law only required access and these people who had accessed had signed a user agreement and understood they had no right to access the information for their personal curiosity. CHAIRMAN TAYLOR added a woman was fired in 1984 for using APSIN for personal purposes, he thought this felony statute (or perhaps the two misdemeanors) were enacted to ensure that this did not ever happen again. MR. NORSWORTHY said it is clear that employees can be punished administratively for this, even be fired, and an argument can be made that a person who accesses APSIN for an unauthorized purpose has violated the felony statute, but there was no desire on the part of the Department of Law to use this statute unless there was further criminal action. MR. NORSWORTHY referenced a memo in his report from Dean Guaneli to Attorney General Bruce Bothelo which outlines why the department did not want to invoke this felony statute. Number 305 MR. NORSWORTHY opined that this statute could have been used if the trooper had discovered a third party compelling the unauthorized access and then later receiving the accessed information. He believes both parties would be in violation in this instance. MR. NORSWORTHY indicated that no actual benefit must be proved for the official misconduct law to apply, only the intent to benefit. Based on the evidence MR. NORSWORTHY saw, he believed there was no impetus to prosecute unless there was an actual benefit achieved by the access. MR. NORSWORTHY added that many notes in the files indicated that since negative information was not found, there was no benefit. On the contrary, MR. NORSWORTHY asserted that it was of great benefit to learn no information existed, and might save time and money for a person trying to "dig up some dirt." Again, MR. NORSWORTHY indicated that this statute could be prosecuted if the intent to benefit was found. The misuse of confidential information statute does say the information received must be used and, according to MR. NORSWORTHY, this was honed in on by the Department of Law and MR. NORSWORTHY concedes this is the "muddiest" statute. Number 194 MR. NORSWORTHY called attention to page 6 of his report which contains notes from a meeting held on 5/15/97 attended by State troopers and Mr. Guaneli, MR. NORSWORTHY assumed the notes refer to what Mr. Guaneli said. CHAIRMAN TAYLOR read excerpts of the notes including, "Leg - not victims; letters sent out asking their complaints have already been sent, none received . . . interviews not needed" and "revealing names - Legislature can be vindictive" as well as "union/political affiliation it would put them off - avoid prying questions politics(union) to give Legislature _____ fodder." MR. NORSWORTHY noted that the word before fodder was edited as were all the troopers field notes. MR. NORSWORTHY sent a letter to Mr. Guaneli asking for unedited copies and Mr. Guaneli declined, saying the edits were not related to the information requested by the subpoena, though, according to MR. NORSWORTHY, this obviously was. CHAIRMAN TAYLOR asked MR. NORSWORTHY to send a letter to Mr. Guaneli requesting unedited copies of these notes. CHAIRMAN TAYLOR also asked about item #6 that read, "advice/questions - fax to Dean for Otte." Number 146 SENATOR PARNELL asked if this meeting had taken place prior to the troopers interviewing suspects and MR. NORSWORTHY indicated it had and was part of a whole series of communications in which a protocol was developed. MR. NORSWORTHY stated that a question regarding union activism and political affiliation had initially been one of the standard questions the troopers would ask (as shown on the unsigned memo on page 30 of the report), but was later removed. The question did eventually appear in the outline with a cautionary note reading; "do not go into these questions unless initiated by the suspect." MR. NORSWORTHY did not understand this, as he believed this to be the main impetus of the investigation in the first place. MR. NORSWORTHY referred to what appeared to be more notes from the same meeting which read, "doesn't make this a criminal investigation - breaches in APSIN protocol." CHAIRMAN TAYLOR asked if these notes were apparently taken by someone being advised by Mr. Guaneli. MR. NORSWORTHY thought so, considering the context of Mr. Otte telling him (in MR. NORSWORTHY's interview with him) he did not feel there should have been any type of criminal investigation, since no one had reported a crime. Mr. Otte thought there had been ample time for any legislator to come forward with a complaint and an investigation was unnecessary since the audit had not surfaced anything. MR. NORSWORTHY asked Mr. Otte why he had conducted the investigation and he said he had done it because the Legislature wanted it. MR. NORSWORTHY said the notes seem to reflect debate over whether or not the investigation would be run like a normal criminal investigation. MR. NORSWORTHY continued reading the fragments of notes, "doesn't make this a criminal investigation" and "breaches of APSIN protocol," then "closer to administrative than criminal, Commissioner doesn't believe they're victims . . . already given ample opportunities to come forward with information" and "disclosure is not warranted in most situations, only as discretion, as necessary." MR. NORSWORTHY claimed this related to the debate over whether or not the troopers could tell legislators who had been accessed who had accessed their name in order to get information. TAPE 98-25, SIDE A Number 001 MR. NORSWORTHY said certain troopers did not see how an effective investigation could have been done without doing this but others were concerned about violating the statute that required confidentiality be maintained in regard to an APSIN user's name. MR. NORSWORTHY said it did not become an issue since they determined the Legislators had not come forward with any information. MR. NORSWORTHY continued to read from notes which read, " 1) not victims, 2) not interview as standard strategy, 3) not disclose names as standard strategy, 4) political affiliation - a) state employee can mask and are most [sic] sophisticated as common criminal, b) put legislators on the spot to present facts to investigators, c) commissioner's call, d) we expect most out of curiosity." MR. NORSWORTHY remarked that item B seemed to set up an adversarial relationship in which the victims were supposed to provide the investigators with the necessary evidence to prosecute. CHAIRMAN TAYLOR commented he found these note fascinating because if the troopers would not go talk to the legislators, they would never get to "put them on the spot" to get the information they needed. MR. NORSWORTHY suggested this could refer to the letters that Mr. Otte had sent to the legislators who were accessed, asking them if they had any information about that access. CHAIRMAN TAYLOR stated that Commissioner Otte failed to notify the Legislators who had accessed their records, making it difficult for them to provide any information about the person. MR. NORSWORTHY agreed, and said there was a note in the report from Captain Cassanovas who believed an effective investigation could not be done without this technique. SENATOR WARD addressed the committee, saying he had requested the troopers interview him and told a trooper to formally charge the Governor, Bruce Bothelo and Lori Otto. SENATOR WARD said this did not appear in the report. SENATOR WARD proposed that this had something to do with Lori Otto being fired and rehired, and said a prosecutor had told him she was rehired because of the Ward/Salo campaign. SENATOR WARD believed that Judy Salo, his opponent, had access to some information, as she asked him to sign a release he did not understand for some type of court document. SENATOR WARD alleged this whole thing is related to the Unions, Ms. Otto and the Democratic Party. He said he made a complaint to the trooper, informing him the whole affair was a conspiracy to elect Democrats and none of this appeared in MR. NORSWORTHY's report. MR. NORSWORTHY indicated that the report does not represent all the records in the case, he focused on the troopers' investigations with incriminating evidence. MR. NORSWORTHY reported that the protocol that was decided on in the case did not allow the troopers access to the administrative audit file because DoL felt this might taint the investigation and it could be later argued that the investigation was based on statements compelled against the employees' fifth amendment rights. MR. NORSWORTHY said he is aware of no legal basis for this argument, even if the employees' statement would be later deemed inadmissable. MR. NORSWORTHY said this amounted to a waste of the time and money spent on the previous inquiry. MR. NORSWORTHY said, additionally, troopers and employees questioned this policy that precluded them from learning anything from the prior administrative review. CHAIRMAN TAYLOR asked about the case in which a person without APSIN authorization asked an APSIN user to get information for them. CHAIRMAN TAYLOR asked who these people were. MR. NORSWORTHY replied that the access was made by Debbie Alsterberg, an employee of the Wasilla Police Department. Ms. Alsterberg accessed the record of John Kramer the new city administrator of Wasilla (appointed by the new Mayor Sarah Palin), she alleged at the request of her boss, Mr. Stambaugh. MR. NORSWORTHY remarked that it was well known in Wasilla that Mr. Kramer's position had previously been held by a friend of Mr. Stambaugh and also that there was much ill will between Mr. Stambaugh and Mayor Palin. In fact, Mayor Palin had fired Police Chief Stambaugh and he had subsequently filed a wrongful termination lawsuit against Mayor Palin and the City of Wasilla. Mr. Stambaugh took a private contract to work in Bosnia and remained there during the investigation. MR. NORSWORTHY interviewed Ms. Alsterberg and reported that she unequivocally stated that she had accessed Mr. Kramer's APSIN record at the request of then-Chief Stambaugh, who did not have APSIN authorization. Stambaugh did not tell Ms. Alsterberg why he wanted her to run Mr. Kramer. During the investigation, the troopers sent a letter to Mr. Stambaugh in Bosnia, telling him what Ms. Alsterberg had said and asking he contact them for an interview. Mr. Stambaugh replied to the letter by mail, denying any recollection of asking Ms. Alsterberg to access this file. According to MR. NORSWORTHY, the troopers received this denial and left it at that. MR. NORSWORTHY suggested the initial letter "tipped off" Mr. Stambaugh and said no investigation was ever opened on Mr. Stambaugh. MR. NORSWORTHY reported further ill will in Wasilla resulted, with people there alleging that there was an unwillingness to go after Mr. Stambaugh due to his long, personal friendship with Commissioner Otte. MR. NORSWORTHY said what struck him was the lack of recognition of a conflict of interest in this particular case, and at least one other. Number 362 MR. NORSWORTHY said Ms. Alsterberg clearly fingered Stambaugh with strong evidence showing he misused his office, and there is strong circumstantial evidence that indicates he intended to use the information for personal benefit, even if there was no benefit realized. MR. NORSWORTHY remarked that this was still not enough for the troopers to do an additional investigation. MR. NORSWORTHY noted that simultaneous to these events were several other dubious accesses of the records of the Mayor of Wasilla and her husband by two other police officers (Sonnerholm and Jessen). MR. NORSWORTHY covered another case from his report involving a Palmer police dispatcher (Ms. Bowman) who accessed both Mayor Palin and Assistant City Administrator David Chappel, telling investigators she accessed those records after hearing a remark made in the police station wondering if Mayor Palin had a criminal background. MR. NORSWORTHY said what strikes him is that the investigation was dropped after the suspect said the access was made due to curiosity and the information was not discussed with anyone else. Ms. Bowman said she made the other APSIN access (of Mr. Chappel) at the explicit request of Captain Don Savage, who was particularly interested in anything related to domestic violence. Again, Captain Savage said he could not remember making this request and that was the end of the investigation. MR. NORSWORTHY said he was mystified over the lack of an attempt to reconcile big discrepancies between the information provided by two different interviewees. MR. NORSWORTHY again noted the apparent conflict of interest in this investigation. Number 453 MR. NORSWORTHY pointed out a note from an e-mail in which trooper Hughes asks to have all of the investigative files retroactively changed in APSIN so the suspects will not be listed as "suspects," but rather as "interviewees" due to a concern that being labeled "suspect" might hurt future chances for employment, especially in law enforcement. This occurred after all the cases were closed and all prosecution had been declined. MR. NORSWORTHY thought the same reasoning might have been used in not opening an investigative file on Mr. Stambaugh and Mr. Savage. Number 478 SENATOR WARD said he received a phone call saying the troopers would interview 10-20 people, but none of those people who would tie the affair back to the unions and the third floor. SENATOR WARD asked the trooper if he was going to investigate these other people and the trooper replied that he had been given only 16 names by the Commissioner of Public Safety and he could not look at any others. MR. NORSWORTHY replied that he had also spoken with Captain Cassanovas and asked him who had determined who would be prosecuted. Cassanovas replied that the decision had come from the Commissioner's office but he did not know exactly who had made it. SENATOR ELLIS asked CHAIRMAN TAYLOR if he planned to continue this and if there would be copies of MR. NORSWORTHY's report available to the press and the public. CHAIRMAN TAYLOR replied that SENATOR ELLIS could do whatever he liked with it. SENATOR ELLIS asked if this was the final report of it there would be additional reports written. CHAIRMAN TAYLOR said he had only received the report today and the committee would have to decide that after reviewing this report. Number 514 MR. NORSWORTHY said this had been characterized as an interim report due to the fact that he has an ongoing investigation that may yet yield further information. CHAIRMAN TAYLOR expressed shock and disappointment over the memos and notes he had seen. He said the committee needs to have Mr. Guaneli and some troopers appear before them to explain who wrote the notes and what has been edited from them. CHAIRMAN TAYLOR said it appears clear that major decisions were made after the Joint Judiciary meeting to stack the deck and whitewash the investigation. He said there was an obvious intent to cover up the whole situation and he finds it more than offensive. REPRESENTATIVE HODGINS mentioned he planned on meeting with the Commissioner and preparing charges against the individual in the Wasilla case, as the access was obviously made for political and personal benefit. He asked CHAIRMAN TAYLOR how he planned to proceed. CHAIRMAN TAYLOR replied that he would like to allow the committee further time to review the report whenever MR. NORSWORTHY could return. MR. NORSWORTHY indicated he would be available to return Wednesday. CHAIRMAN TAYLOR stated the meeting would begin at 1:30. With no further business to come before the committee, CHAIRMAN TAYLOR adjourned at 4:00.