One of the former MZM employees quoted Wade as describing his
congressional strategy this way:
"The only people I want to work with are people I give checks to. I
own them."
From The Union-Tribune, 6/21/05:
http://www.signonsandiego.com/news/politics/20050621-2202-cnsmzm.html
Contractor pressured employees to contribute to Cunningham, three say
By Marcus Stern
COPLEY NEWS SERVICE
WASHINGTON --
Mitchell Wade, founder of the defense contracting firm MZM Inc.,
pressured employees to donate to a political fund that benefited Rep.
Randy "Duke" Cunningham and other members of Congress, according to
three former employees of the company.
Wade, who took a $700,000 loss on the purchase of Cunningham's Del Mar
home and allows the congressman to stay on his yacht while in
Washington, demanded employees tomake donations to the company's
political action committee, MZM PAC, they said.
"By the spring of '02, Mitch was twisting employees' arms to donate to
his MZM PAC," said one former employee.
"We were called in and told basically either donate to the MZM PAC or
we would be fired."
Many companies have PACs, but campaign finance laws prohibit employers
from pressuring workers to contribute to the PAC.
They may encourage contributions, but not compel them.
"It is illegal to solicit campaign contributions for the company's
political action committee by the use of threats, force or threat of
job reprisal," said Larry Noble, former general counsel of the Federal
Election Commission and currently director of the Center for
Responsive Politics, a nonpartisan organization that tracks the flow
of money in politics.
"If they say to somebody, `You either give or you are going to be
fired,' they have violated the law," Noble said.
MZM officials did not respond to requests for comment.
In the past week, Wade resigned the posts of president and chief
executive officer of the company, turning over those duties to Chief
Operating Officer Frank Bragg, company sources said.
Wade remains the primary shareholder of the privately held,
Nevada-licensed company, sources added.
The resignations came after the Union-Tribune reported that Wade had
purchased and then sold Cunningham's Del Mar house at a loss of
$700,000 and has allowed the Rancho Santa Fe Republican to stay aboard
his yacht, called the Duke-Stir, while in the nation's capital.
The FBI and a federal grand jury are investigating the matter.
Since the initial disclosure of the 2003 home sale, Cunningham has
released only two brief statements on his ties to Wade, saying that
the home sale was "aboveboard" and that he has paid an undisclosed
amount for use of the yacht.
Wade has made no public comment since his ties to Cunningham were
first reported.
Wade operates out of the company headquarters, a four-story townhouse
in the Dupont Circle area of Washington.
About 20 to 25 employees work in the building, according to the former
employees.
They say the company has grown to more than 400 employees, with much
of the expansion coming in the past two years.
Little public information exists on what MZM ... a name based on the
first names of Wade's children Matthew, Zachary and Morgan ... does
for the government.
Former employees, however, say much of its work is with three defense
intelligence operations:
Counter Intelligence Field Activity, a highly secretive program
created in 2002 by a Pentagon directive that focuses on gathering
intelligence to avert attacks like the ones on Sept. 11, 2001.
The Army National Ground Intelligence Center in Charlottesville, Va.,
whose mission is to provide soldiers with battlefield intelligence.
The U.S. Army Intelligence and Security Command at Ft. Belvoir, Va.,
just outside Washington, which also provides battlefield intelligence.
MZM has been seeking to increase its contracts with the Central
Command, which oversees military operations in Iraq and Afghanistan,
and the Special Operations Command, both based at MacDill Air Force
Base in Tampa, Fla., according to former employees.
The three former MZM employees who said Wade pressured them and others
to donate money to the company PAC declined to be identified, saying
they feared for their careers if their names were disclosed.
All continue to work in the military and intelligence fields.
They and other former MZM employees questioned the way Wade solicited
contracts from Defense Department intelligence agencies during the
time they worked for the company.
They also expressed concerns about Wade's dealings with three House
members who received a large portion of the money disbursed by MZM's
PAC.
The three ... all Republicans ... are Cunningham and Reps. Virgil
Goode of Virginia and Katherine Harris of Florida.
MZM's PAC donated $17,000 to Cunningham from 2000 to 2004. Donations
included $12,000 to "Friends of Duke Cunningham" and $5,000 to his
leadership PAC, the American Prosperity PAC.
During the same period, MZM PAC gave Goode $11,000 and Harris $10,000.
Neither Goode's nor Harris' offices returned calls seeking comment.
Many companies form PACs to raise and spend money to help elect or
defeat political candidates.
Individuals also may contribute separately.
PACs are not allowed to give more than $5,000 to any one candidate per
election.
When a primary and general election are involved, PACs may give $5,000
per candidate in each, for a total of $10,000 per election cycle.
Individuals may give up to $4,000 per election cycle.
In addition to the MZM PAC, MZM officials also made contributions to
the House members' campaigns.
Wade gave Cunningham $6,000 between 2000 and 2004.
MZM officials and their family members gave Harris, who ran for
Congress in 2002, a total of $44,000 during 2003 and 2004.
Goode received a total of $27,851 between 2000 and 2004.
MZM senior employees and family members gave Goode an additional
$44,625 in March, according to information compiled by the Center for
Responsive Politics.
MZM has a facility in Goode's rural Virginia district, not far from
the Army National Ground Intelligence Center, which is one of MZM's
key customers.
MZM is also planning to buy a facility in Harris' district, where it
can be close to two of its other customers, the U.S. Central Command
and the Special Operations Command, which are in a neighboring
congressional district.
Cunningham is on the Permanent Select Committee on Intelligence and
the defense appropriations subcommittee, which puts him in position to
influence the awarding of defense intelligence contracts.
MZM had 56 such contracts totaling $68,645,909 in fiscal year 2004,
according to Keith Ashdown, an analyst with Taxpayers for Common
Sense.
One of those contracts is to provide interpreters in Iraq.
For the most part, the contracts were awarded to MZM without
competition through a process known as "blanket purchase agreements."
Ashdown echoed the comments of former MZM employees in saying Wade
strategically targeted MZM's donations.
"A lot of people will throw a lot of money at a lot of different
people," Ashdown said.
Wade's "strategy was, `I need to make friends with a few very
influential lawmakers and really, really schmooze and coddle them and
that's how I'm going to make my money.'
And that's what he did.
"The first person is Cunningham, a senior guy on the (defense
appropriations) committee, and he helps them get business. Then they
go to another guy on the (defense appropriations) committee, Goode,
who's more junior but has the benefit of getting a facility in his
district. And then they go to Katherine Harris, who isn't on the
committee but needs lots of money for her Senate race and would be
bringing business and new jobs to her area," Ashdown said.
Harris plans to run for Senate next year.
One of the former MZM employees quoted Wade as describing his
congressional strategy this way:
"The only people I want to work with are people I give checks to. I
own them."
Another former employee said Wade used letters to remind employees
before their employment anniversaries to contribute a designated
amount to the company PAC.
The specific amount was based on their level of seniority in the
company, with more senior officials expected to give $1,000 each and
less senior employees expected to give $500, the former official said.
A third former employee described being rounded up along with other
employees one afternoon in the company's Washington headquarters and
told to write a check, with the political recipient standing by.
The former employee wouldn't give the name of the politician receiving
the donations.
________________________________________________
Hey, why not? Repugs are above the law. They don't have answer to
anyone. You should know that by now.
Harry
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