Rep. Cunningham's Plea Was Only the Start

Saturday May 13, 2006 7:01 PM
By SETH HETTENA
Associated Press Writer

SAN DIEGO (AP) - The political scandal that brought down former U.S. Rep. Randy "Duke" Cunningham didn't end when the Vietnam War hero began serving an eight-year sentence in federal prison for taking millions of dollars in bribes.

Since Cunningham, R-San Diego, was sentenced in March, the case has turned into a sprawling federal investigation with all the soap opera elements - money, power and sex. One of Washington, D.C.'s most notorious landmarks - the Watergate Hotel - even has a place in it.

The case has many wondering where it will go next after a dizzying week in which the name of Rep. Jerry Lewis, chairman of the powerful House Appropriations Committee, surfaced in the probe and the home of the outgoing executive director of the CIA was searched.

The link in all these strands isn't Cunningham, who pleaded guilty to accepting $2.4 million in bribes from defense contractors. It's San Diego businessman Brent Wilkes, described in Cunningham's plea agreement as an unindicted co-conspirator.

Prosecutors allege Wilkes paid Cunningham, a former member of the House Appropriations Defense Subcommittee and the Permanent Select Committee on Intelligence, more than $626,000 in bribes between 2000 and 2004 to win government contracts for his companies. But it's Wilkes' links to other lawmakers, lobbyists and government officials that has dramatically expanded the case.

"It's all about Wilkes paying people to get contracts," said Melanie Sloan, a former federal prosecutor in Washington and executive director of Citizens for Responsibility and Ethics in Washington. "Anybody who Brent Wilkes has been making substantial contributions to, they're going to be looking at. They'd have to."

Wilkes' attorneys have said he has done nothing illegal. His lawyers, Nancy Luque and Michael Lipman, did not return a phone message left seeking comment.

On Friday, FBI agents descended on the Virginia home and office of Kyle "Dusty" Foggo, the No. 3 CIA official who oversaw the spy agency's day-to-day operations. The search warrants were obtained by the federal prosecutors in San Diego who took down Cunningham, assistant U.S. Attorney Phil Halpern said.

Earlier in the week, Lewis, R-Redlands, issued pointed denials of any wrongdoing after it was disclosed that prosecutors have opened an investigation into his dealings with Bill Lowery, a former congressman from San Diego who served with him on the Appropriations Committee before leaving Congress in 1993. Now a lobbyist, Lowery's clients included ADCS Inc., a San Diego defense contracting firm founded by Wilkes.

Lowery has donated nearly a half-million dollars to Lewis' political action committee since 2000.

Foggo's ties to Wilkes go back to childhood. The two grew up together in the San Diego suburb of Chula Vista, played on the same high school football team and roomed together at San Diego State University. The men are so close they each named a son after the other.

A federal task force based in San Diego is investigating whether Foggo improperly intervened in awarding a company connected to Wilkes a contract to supply bottled water to CIA agents in Iraq.

Foggo's defense attorney, William G. Hundley, did not return a message seeking comment.

Investigators also have contacted two Washington, D.C.-based escort services in an effort to determine whether Wilkes supplied Cunningham and potentially other lawmakers with prostitutes, reportedly at the Watergate Hotel and, later, at the Westin Grand.

The allegations involving prostitutes were raised by defense contractor Mitchell Wade, who pleaded guilty to paying Cunningham more than $1 million in bribes. Wilkes also hosted poker parties for CIA personnel at the hotel.

Foggo has acknowledged participating in poker games organized by Wilkes at the hotel rooms, but the CIA said in a statement that Foggo insists they were card games "and nothing more." Lawyers for Wilkes also have denied there was any involvement with prostitutes.

Randall Eliason, former head of the public corruption section of the U.S. Attorney's office in Washington, said it looks like investigators are casting a wide net.

"It looks like they're going to explore all of Wilkes' contacts and sort of follow where it leads," he said. "Whether that means other members of Congress will be indicted, it's almost impossible to say from the outside."

Congress bribery probe could deepen
Records detail contractor's sway

By Michael Kranish, Globe Staff  |  May 19, 2006

WASHINGTON -- On March 8, 2004, after a private, chartered flight from Washington, Congressman Randy ''Duke" Cunningham checked into a luxury oceanfront suite at the Delano Hotel, a restored Art Deco jewel on Miami Beach. Prosecutors say the San Diego lawmaker, in town to shop for a yacht, racked up more than $15,000 in bills during the trip, including $848 in meals.

Court records show that Mitchell Wade, an ambitious defense contractor with deep pockets, picked up most of the tab. Prosecutors say the Miami Beach trip was pocket change compared with the more than $1 million in bribes Wade paid to Cunningham, a former fighter pilot and powerful member of the House Appropriations Committee, to steer government defense contracts his way.

But Wade had more money to spread around.

Within days of sending Cunningham to Miami, prosecutors say, Wade gave $32,000 in laundered campaign funds to Representative Katherine Harris, the Florida Republican and Homeland Security Committee member whose help Wade was seeking to create a complex for MZM Inc., his company, in her home state. Documents say Wade also funneled $46,000 into the campaign account of Representative Virgil H. Goode Jr., a Virginia Republican who also sits on the Appropriations Committee.

Wade then discussed getting specific defense appropriations with Harris and Goode or their staffs, according to court documents. Weeks after Wade arranged for most of the contributions to Goode, Wade walked away with a pledge for a $9 million facility in Goode's district with help from Goode's office, the court filings say

Harris and Goode both say they didn't know the contributions had come from straw donors and were illegal. They have not been charged.

Nevertheless, court papers indicate that the investigation that snared Cunningham -- in which the California Republican, now serving a 10-year sentence in federal prison, admitted that he took millions in bribes -- and led Wade to take a plea deal could go much deeper. At least three other federal investigations involving members of Congress are also underway, linked to questions about whether lawmakers traded the power and influence of their offices for hefty campaign contributions and lavish gifts.

''There is some increasing panic among members who worry that there may be e-mails in which they sort of promised to do something that is contemporaneous with campaign contributions," said Thomas Mann of the Brookings Institution.

Previously, Mann said, members of Congress may have believed they were following the rules as long as donations they received were legal. Now, he said, members are concerned that Justice's Office of Public Integrity is looking at possible connections between campaign contributions and official action. The investigations are warranted, Mann added, because ''things got really out of hand" with members taking action on behalf of contributors or those provided gifts.

''If the Office of Public Integrity action is a bit strong, sometimes you have got to overreact to stamp out a practice that is truly noxious," he said.

Word about the various investigations has been trickling out in news reports for months. Authorities want to know whether Representative Alan B. Mollohan, a West Virginia Democrat and Appropriations Committee member, used his clout to hand government contracts to nonprofit groups run by his friends; whether disgraced former GOP lobbyist Jack Abramoff bribed Representative Bob Ney, Republican of Ohio; and whether the House Appropriations Committee chairman, Jerry Lewis of California, also a Republican, improperly awarded contracts sought by a lobbyist who has been linked to Cunningham.

The anxiety level in Congress increased this week after the House Ethics Committee -- long criticized for its reluctance to investigate members -- announced that it was looking into the behavior of Ney and Representative William J. Jefferson, a Louisiana Democrat who is suspected of receiving bribes.

All of the members under scrutiny have denied wrongdoing.

Perhaps most significant, the Ethics Committee said it will examine the Cunningham case to determine ''whether other House members or staff are implicated." The committee said it would check out allegations that members and staff received ''hotel rooms, limousines, and other services in exchange for performing official acts"

Though Cunningham and Wade both pleaded guilty, federal officials also want to know whether a second unnamed defense contractor may also have wooed congressmen, other defense contractors, and the CIA's third in command with poker parties, a hospitality suite, and possibly prostitutes.

The totality of these investigations marks one of the Justice Department's most concentrated public corruption efforts in recent history.

In a speech last week in San Diego, FBI Director Robert S. Mueller III said the bureau has made those cases its top priority. ''More than ever, the FBI must be actively engaged in combating public corruption," Mueller said.

Though Cunningham reportedly is not cooperating with investigators, prosecutors last week asked a judge to delay Wade's sentencing because they expect his ''cooperation will continue for quite some time."

Cunningham, a decorated Vietnam War veteran, was so aggressive in seeking bribes that he kept track of them on his House stationery, court papers said. One notation says that in exchange for a $16 million defense contract, Cunningham expected to receive $140,000. An additional $1 million on that project would cost the contractor another $50,000 bribe, according to court documents.

In all, Cunningham took in at least $2.4 million since 2000, in part through a $700,000 profit on the sale of his relatively modest California home, a transaction that tipped off investigators, according to court records. Besides cash, contractors bribed Cunningham with top-of-the-line cars, a yacht, and antique furnishings for his new $2.5 million mansion. Wade, prosecutors say, was Cunningham's chief benefactor, even paying $115,000 toward the congressman's capital gains tax.

''Cunningham grew to expect luxury," prosecutors said in court documents. ''His coconspirators eagerly plied him with it."

Having won over Cunningham, Wade set his sights on Congress members Harris and Goode, according to court documents.

Wade wanted Harris -- the former Florida secretary of state who had a pivotal role in the disputed 2000 presidential election who is now running for US Senate -- to request an earmarked appropriation allowing MZM to build a Florida facility, the court records say. A few days after paying for Cunningham's Miami Beach trip, Wade gave some of his MZM employees and their spouses $2,000 each, reimbursement for checks they'd write to Harris's 2004 House campaign.

''The employees [then] delivered the checks to Wade, who personally handed them" to Harris, the court documents say.

In early 2005, Wade met Harris for dinner at Washington's posh Citronelle restaurant to discuss a fund-raiser for Harris and whether Harris could get federal money for an MZM facility in her district, according to the Orlando Sentinel. Wade picked up the $2,800 dinner check, a violation of House ethics rules if Harris's portion of the meal was worth more than $50. Harris has said she didn't eat or drink much at the dinner and that she thought her staff had paid for her share.

In a written statement to reporters, Harris acknowledged that she and Wade talked business and that she later requested but couldn't get a $10 million appropriation for the MZM project, which she thought would create local jobs. A spokesman would not say whether Harris was present when Wade handed over the $2,000 checks for her campaign.

Wade also arranged for Goode's reelection campaign to get big checks. Court records say that in March 2005 Wade gave money to his associates, who in turn became what the government calls ''straw donors," contributing at least $46,000 of Wade's money to the Virginia Republican. Wade then asked Goode and his staff for federal money to build an MZM facility in Goode's district. In June 2005, Goode's staff ''confirmed to Wade that an appropriations bill would include $9 million for the facility and a related program," according to court records.

In an e-mail to the Globe, Goode said he has no problem discussing a federal contract with such a big campaign contributor. Asked what he believed Wade wanted after MZM employees contributed so much money to his campaign, Goode responded, ''I'm a strong supporter of 'Buy American' and a promoter of the Fifth District of Virginia in which MZM facilities were located."

Wade's unnamed, unindicted coconspirator, whom news reports identified as Brent Wilkes, a onetime associate of his, also allegedly paid Cunningham more than $600,000 to get defense contracts. Wilkes ran a company called ADCS Inc., which got tens of millions of dollars in contracts to transform the Pentagon's paper documents into computer files; court documents say that Cunningham had a hand in getting ADCS hired.

Wilkes's name surfaced again recently because he reportedly attended poker parties at the Watergate that included members of Congress, defense contractors, and Kyle ''Dusty" Foggo, the third-ranking leader at the CIA who resigned last week.

Another probe in Cunningham case

By: MARK WALKER - Staff Writer
Last modified Thursday, May 18, 2006 11:00 PM PDT

After a recent report that he was not fully cooperating with ongoing probes, Randy Cunningham is ready to assist in a new examination of congressional corruption announced by the House ethics committee this week, his attorney said Thursday.

"He will cooperate with that investigation just as he is cooperating with all the others," attorney K. Lee Blalack said of Cunningham, who is in prison after pleading guilty to accepting more than $2.4 million in bribe.

Last week, Rick Gwin of the Pentagon's Defense Criminal Investigative Service complained Cunningham had not been cooperating in the manner his agency expected following the former 50th Congressional District Republican's sentencing in March to eight years, four months in prison for bribery and tax evasion.

Blalack refused to expand on the type of cooperation he said Cunningham will give congressional investigators.

On Wednesday, the Committee on Standards of Official Conduct announced it had launched an investigation to determine if other congressional members or staffers aided Cunningham in improperly influencing the awarding of government contracts.

However, a watchdog group predicted the committee ultimately will drop the probe, citing an ongoing Justice Department investigation taking precedence over its work.

Investigators with several federal agencies are continuing to examine lawmakers and others who may have aided Cunningham in his criminal activities.

A statement issued by the committee said the panel intends to act forcefully if it uncovers wrongdoing.

"Should we become aware, either through the inquiry we have undertaken or through any other source, of facts supporting a more formal investigation of one or more members, officers or employees, we intend to take all appropriate steps under committee rules, including recommending the establishment of one or more investigative subcommittees."

A spokeswoman for the Washington office of the watchdog group Citizens for Responsibility and Ethics in Washington, said she doubts that would happen and contended that the committee statement released by Chairman Doc Hastings, R-Washington, was nothing more than a public relations exercise.

"It's pretty funny considering Cunningham is already sitting in jail," said the group's Naomi Seligman Steiner. "And anyone the committee might look at is already under investigation by the Justice Department."

Because of that, she said, she expects the committee will announce later this year that it is suspending its work.

"The committee will say it wanted to do an investigation but couldn't because the subjects are already part of a federal probe, so this won't result in anything other than the committee being able to say, 'Look, we tried.' "

Last July, the group asked Congress and the House ethics committee to investigate Cunningham and his ties to now-admitted co-conspirator Mitchell Wade, who pleaded guilty in February to bribing Cunningham, as well as three related offenses.

Wade is continuing to cooperate with the government, his attorneys have said, and that was underscored last week by the Justice Department, which hinted in a court filing that its investigation of people connected to Cunningham could go on for months.

"The defendant's cooperation is ongoing," the Washington U.S. attorney's office said in a May 10 court filing seeking to delay Wade's sentencing and suspend completion of a pre-sentence report until its work is done. "The government and the defendant expect that the cooperation will continue for quite some time."

Nearly all of the turns and twists in the Cunningham scandal in recent weeks have been tied to Poway defense contractor Brent Wilkes, alleged in court papers to be chief co-conspirator in the former lawmaker's bribery.

Wilkes, whose attorneys deny he has done anything wrong and who has not been charged with any crime, founded the firm ADCS in 1995. In the last 11 years, he was able to secure approximately $85 million in government contracts for document conversion and other work, most of which was secured with Cunningham's help.

Wilkes is also a longtime friend of the former No. 3 man at the CIA, Kyle Foggo, whose home and office were raided by federal agents last week as they probe whether he improperly directed CIA work to Wilkes and ADCS.

Foggo, who has denied any wrongdoing, resigned from the intelligence agency last week.

The Justice Department and ethics committee investigations aren't the only probes tied to Cunningham, who remains at a federal prison in Butner, N.C., where he was sent for medical and physical evaluation after his March 3 sentencing.

The House Armed Services Committee is looking into whether Cunningham improperly influenced panel staffers to bypass regulations in the awarding of defense contracts.

Another probe, one by the House Permanent Select Committee on Intelligence, is analyzing whether Cunningham disclosed any national secrets while serving on that panel and as chairman of one of its subcommittees is nearing completion, panel spokesman Jamal Ware said Thursday.

Committee Chairman Pete Hoekstra and ranking Democrat Jane Harman receive regular updates on the status of that probe and expect a final report soon, Ware said.