From The Union-Tribune, 7/17/07:
http://www.signonsandiego.com/news/politics/cunningham/20070717-2053-bn17dukebribe.html
Imprisoned Cunningham outlines depths of corruption to FBI
By George E. Condon Jr. and Marcus Stern
COPLEY NEWS SERVICE
WASHINGTON –
In two days of prison interviews with federal agents this year,
disgraced former Rep. Randy “Duke” Cunningham described a level of
corruption on his part more extensive than previously known and dealt
a potentially devastating blow to the defense being waged by one of
the defense contractors alleged to have bribed him.
The interviews were conducted in February at the federal prison near
Tucson, where the longtime Republican congressman is serving an
eight-year and four-month sentence after admitting to accepting more
than $2.4 million in bribes.
He pleaded guilty to conspiracy and tax evasion.
According to an 11-page FBI summary of the sessions, obtained by
Copley News Service, Cunningham was very much the initiator of his
corrupt actions, demanding bribes, accepting envelopes with cash and
displaying an insatiable appetite for more money, more cars, more
drink, more fine food and more expensive goods.
Cunningham's answers are bad news for Brent Wilkes, president of
Poway-based ADCS Inc., who is fighting bribery charges against him.
They set the stage for what could be a dramatic courtroom showdown
between the former North County congressman and his longtime
benefactor.
Wilkes faces 30 counts in two separate indictments, including charges
that he gave Cunningham $600,000 in gifts and cash in exchange for
Cunningham's help in getting more than $80 million in defense
contracts.
Wilkes' two trials are expected to occur this fall.
The government has not said if it will bring Cunningham back to San
Diego to testify.
Cunningham was able to promote defense contracts for favored companies
through the use of legislative “earmarks,” provisions lawmakers could
slip anonymously into spending bills without debate, discussion or
disclosure that benefit interests in their districts or their
political supporters Wilkes has said a $100,000 payment he made to
Cunningham in 2000, was not a bribe, but instead was to purchase
Cunningham's river yacht, the Kelly C.
“Cunningham said that there was never a sale,” said the FBI report.
“Cunningham stated that he and Wilkes created the cover story of a
boat sale to explain, if anyone ever found out and asked, his receipt
of $100,000 from Wilkes.”
Cunningham told investigators that Wilkes fully understood that there
would be “no actual change in ownership” of the yacht.
The two men agreed to divide the $100,000 into two checks because both
“felt that the smaller checks might be less noticeable.”
The documents show that Cunningham had first asked Wilkes for
$550,000.
“Wilkes said no to the $550,000 but then countered with an offer of
$100,000 if Cunningham would ensure that the support and earmarks
would continue to happen.
Cunningham promised Wilkes that he would 'fight like hell' for
Wilkes/ADCS.”
The FBI report made the point that Cunningham was clear about the quid
pro quo:
“Cunningham stated that, by 2000, he had already been receiving
numerous benefits from Wilkes that included such things as vacation
trips, liquor, cash/maintenance money . According to Cunningham, in
return for these benefits, he had been helping Wilkes/ADCS in their
efforts to secure government contracts.”
Phone messages left at Wilkes' attorneys' offices Tuesday night were
not returned.
His admissions are very much at odds with the image that Cunningham
tried to create after his downfall.
In a letter made public and in private statements to friends, he
portrayed himself as someone unable to withstand the blandishments of
corrupt contractors and someone who merely accepted “gifts” but never
sold his office.
His admissions to the investigators – who were from the FBI, the
Internal Revenue Service, the U.S. attorneys' office and the Defense
Criminal Investigative Service – also shed light on the actions of
others implicated in the scandal.
They include Mitchell Wade, president of MZM, Inc. in Washington, who
pleaded guilty in the case but has not yet been sentenced, and Thomas
Kontogiannis, a New York developer accused of laundering the bribe
money.
Kontogiannis pleaded guilty to providing $1.1 million in mortgages to
Cunningham for a Rancho Santa Fe mansion, even though he knew the
house was purchased with proceeds from illegal activity.
The plea was made in February but was not made public until last
month.
According to the FBI summary, Cunningham admits to being provided with
prostitutes, misleading congressional ethics officials, making others
buy gifts for his daughters, personally devising the schemes to
launder his bribes, lying to his staff, and putting unrelenting
pressure on government officials who thought the defense contracts he
pushed with congressional earmarks were wasteful.
Cunningham was well placed steer military intelligence contracts
toWilkes and Wade because he was on the House defense appropriations
subcommitteeand the House Permanent Select Committee on Intelligence.
He also told investigators he demanded regular cash payments – he
called them “maintenance money” – once even summoning one of his
bribers to his office at the U.S. Capitol to give him $3,000 in cash.
In addition to the FBI summary of the prison interviews with
Cunningham, Copley News Service obtained a 75-page affidavit filed by
the FBI in support of a search warrant in the case.
It provides glimpses of what investigators found as they built their
case against Cunningham and those the suspected of conspiring with
him.
The FBI stated that:
-----More than $1 million in bribes were laundered by being sent to
Kontogiannis instead of going directly to Cunningham. Investigators
identified at least 70 separate bank accounts maintained by
Kontogiannis at only one bank.
-----Despite all his many businesses, Kontogiannis has not filed a tax
return since 2001.
-----For the first time, investigators shed light on what Kontogiannis
expected to get from Cunningham – help on a potential sale of fighter
jets to his native Greece.
-----The Rolls Royce that drew so much attention early in the
investigation was not the only car that Cunningham made the
contractors buy for him. In only two days in early 2002, the
congressman bought a $43,000 Thunderbird and a $41,000 BMW from Bob
Baker Ford in San Diego with $63,000 of his payment coming from
bribes.
-----That was three months before Wade gave him $10,000 toward the
used Rolls Royce. In mid-2004 when Cunningham needed to make repairs
to his boat, he called Wade and demanded $6,500 cash. Wade took the
money out of his petty cash, stuffed the cash into a bulging envelope
and rushed it over to a Cunningham fundraiser at a Washington
restaurant, giving it to a Cunningham staffer.
In his prison interviews with investigators, as summarized by the FBI,
the former congressman is reported to have:
-----Insisted there were no prostitutes at Wilkes' Washington poker
games, but said Wilkes hired prostitutes for him during a Hawaii
vacation. Cunningham was miffed that Wilkes got the “younger and
cuter” prostitute and said he was “somewhat embarrassed on this
occasion because he had some difficulty in completing intercourse.”
On the next night, Cunningham again had a prostitute but said he “did
not have sex” with her “because he felt guilty about his behavior.”
-----Said that among the many weapons Wade bought him was a Glock
handgun, which he kept in a box on his boat – in apparently violation
of D.C. laws.
-----Said he tried to make peace between Wade and Wilkes when the two
former friends fought over contracts.
-----Openly “recalled exerting pressure on government officials” to
reward his bribers.
-----Said Wilkes told him he was “hiding money in a bank account in
Panama” to pay him bribes.
The FBI document also said Cunningham admitted to investigators he:
-----Oversaw attempts to hide his bribe-taking in case he was ever
caught.
-----Made Wilkes buy Cunningham's daughter a computer when she went to
college and then pay for its later repair.
-----Made either Wilkes or Wade pay his way to the 2003 Super Bowl,
Jimmy Buffet concerts in Chula Vista, and several Washington Wizards
and Redskins games.
-----Had to find ways to get around objections from Sen. Richard
Shelby, R-Ala., and Rep. Duncan Hunter, R-El Cajon, both of whom tried
to block Cunningham's spending projects for Wade and Wilkes as
wasteful and unneeded.
_________________________________________________
Smell that stench? Yup, you guessed it. More Republican Culture of
Corruption.
Harry
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