FBI Probes Anacortes Allegations -- Agencies Examine Police Drug- Buying Fund, Old Mysteries

Once proudly proclaimed an All-America City, Anacortes is reeling these days. The FBI has been called in to investigate allegations of police corruption, murder and drug smuggling.

The state auditor's office and the Snohomish County Sheriff's Department also are involved in a widening investigation in the Skagit County town.

The man who invited the FBI to look into the case is Pat Beatie, a former G-man himself who was hired by the mayor in June to oversee the police and fire departments. Beatie, who spent 20 years with the FBI and a short time as a Chelan County undersheriff, won't reveal any of the targets of the probe but promises it will be extensive.

Meanwhile, longtime Police Chief Tony Lippe is home on sick leave and convinced he is one of the people the investigators are after. Although Beatie says Lippe is not a target, the chief thinks the newcomer is chasing "innuendos and insinuations" to get rid of him.

"They are implying that I am involved in a lot of things," said the 14-year veteran of the department. "You start looking over your shoulder when everybody is trying to get at you."

Also home on sick leave is Assistant Police Chief Dave Mead, who is reported to be under suspicion because he had control of a $15,000 undercover drug-purchasing fund - one focus of the investigation. Mead, a 25-year veteran, says his feelings about the probe are unprintable.

A picturesque town of 13,000 people, Anacortes is best known to outsiders as a jumping-off point for the San Juan Island ferries and as a site of two oil refineries.

The probe started quietly in January when Lippe called in the state auditor to quell some nasty rumors that someone had misused the department's drug-buying fund.

When the auditor looked into the locked money bag, most of the cash was missing, Lippe said. But Mead, the assistant chief, was able to account for the money, and the auditor indicated to some that nothing was wrong.

Then the police department and the city called in the Snohomish County prosecutor and sheriff's department to conduct an independent probe.

Joseph Dervaes, an assistant director in the state auditor's office, said the investigation is continuing.

Without pointing fingers, Beatie said Snohomish County deputies have developed an "excellent case" regarding possible misuse of police-department money. And he said yesterday that the probe has expanded from an audit of one fund into an investigation of "other financial allegations." He refused to elaborate.

Beyond that, Beatie acknowledges other aspects of the FBI investigation are based on rumors rather than facts. When Beatie called in the FBI three weeks ago, he asked the agents to take a fresh look at three unsolved murders, some drug allegations and the apparently unrelated disappearances of a woman and three boys. Although the cases are as old as a decade, Beatie said, the town suffers from a "widespread mythology" that the unresolved crimes and disappearances are connected to corruption.

Beatie was surprised that unsolved murder case records were banished to a closed-case file in the basement, something not normally done with crimes for which there is no time limit on filing charges. The FBI may not linger over the files if there appears no connection to police corruption, but Beatie recently appointed his own detective-sergeant to assure that never happens again to a homicide probe.

He said that shortly after he arrived in Anacortes, several townspeople told him stories that had swirled around the old cases for years - about a woman who vanished from her apartment, three boys who disappeared during a boating expedition and the separate murders of an elderly man and two other women.

"I've had people from every walk of life in this community express their concerns over the rumors. People say, `I've been afraid of telling what I know for fear I would disappear, too,' " Beatie said.

Beatie suspects the moldy rumors will wither once the cases are re-investigated,

But as he looked deeper into the stories, Beatie realized the town's history has added to the lore.

"A beautiful place with lots of shoreline and mystery. Moonlit nights. Beautiful tree-covered islands," Beatie mused. "There is quite an opportunity for drug smuggling going back many decades . . . sloops plying between Canada and the San Juan Islands."

In all the uncertainty, Anacortes Mayor Doyle Geer can't fire Lippe, a former Marine who started his law-enforcement career at the Lynnwood Police Department in 1971, because he is protected by civil-service rules. And Lippe isn't anxious to depart under a cloud, despite hypertension that temporarily drove him off the job.

"They made no bones about wanting me to leave," said the 59-year-old chief. "They tell me it is my management style. I call it integrity. I won't look the other way."

Lippe hopes that when investigators finish their work, his name will be cleared and people will remember he is the one who started the probe. But he worries the case will die without resolution, and he is preparing to file a defamation lawsuit against the city.

Meanwhile, Mead, 46, talks with a voice made hoarse by the severe case of asthma that has kept him off the job since early January. He may not return from sick leave, but he, too, hopes to clear himself of any suspicion. Mead is cooperating with the investigation, said his lawyer, Stephen Skelton.

Beatie says he sees improvement in the police department already.

"This was the best and only way to go. Put an end to it. No guilt or fear."