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Congressman Admits Taking Bribes, Resigns

Rep. Randy
Rep. Randy "Duke" Cunningham, center, leaves the federal courthouse in San Diego after entering two guilty pleas. (By Denis Poroy -- Associated Press)

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The government's plea agreement cites an escalating series of payments to the congressman over the past few years, including a graduation party for his daughter; the purchase and upkeep of a yacht and a Rolls-Royce; antiques and rugs; and a payment to cover the capital gains tax when he sold his house in Del Mar, Calif., to a defense contractor in 2003.

For a gruff war veteran, Cunningham emerges from the court documents as a man with surprisingly delicate tastes. Among the gifts he accepted were a $7,200 Louis-Philippe commode, circa 1850; three antique nightstands; a leaded-glass cabinet; a washstand; a buffet; and four armoires. After paying $13,500 toward a Rolls-Royce in April 2002, one of Cunningham's benefactors tossed in $17,889.96 toward the car's repairs less than a month later.

In 2004, the tax-evasion charge said, Cunningham reported joint taxable income of $121,079, when his actual income was at least $1,215,458.

The investigation began in June after reports in San Diego newspapers said defense contractor Mitchell J. Wade, founder of D.C.-based MZM Inc., bought the congressman's house in Del Mar in late 2003 for $1.675 million -- $700,000 more than he sold it for -- and let Cunningham stay rent-free on his 42-foot yacht, the Duke-Stir, while in Washington.

Cunningham and his wife, Nancy, used the proceeds from the sale to buy a $2.55 million mansion in Rancho Santa Fe. Cunningham took actions to obtain government funding that benefited the two defense contractors and then pressured Pentagon officials to award the necessary contracts to those contractors, the government said.

Cunningham denied wrongdoing at the time, although he conceded he had exercised poor judgment in the house and yacht transactions with Wade. Cunningham announced in July that he would not run for reelection.

The inquiry escalated in August and September, with federal authorities conducting searches of the homes and businesses of two other Cunningham friends -- Brent Wilkes and his California defense company, ADCS Inc., and Long Island businessman Thomas T. Kontogiannis.

Cunningham intervened for Wilkes's company at the Pentagon in the late 1990s, and Wilkes and ADCS have given the congressman numerous campaign contributions and have flown him and other members of Congress on trips on the company jet, according to a senior Pentagon procurement officer and public records. Kontogiannis bought Cunningham's boat, the Kelly C, for $600,000 and arranged a second mortgage on the Rancho Santa Fe house.

Wade stepped down as head of MZM soon after the story broke. The company was sold to a New York investment firm for an undisclosed price in August. Wade had built it from a company employing a handful of workers to one that had 400 employees -- many with high security clearances -- and had landed $160 million in Pentagon contracts in the past three years.

It was clear from the facts stated in the criminal charges yesterday that Wade was one of the four co-conspirators, because of the reference to buying the yacht and renaming it the Duke-Stir. Wade's Washington attorney, Reg Brown, declined to comment yesterday. The identities of the other three co-conspirators are unclear from their descriptions in the criminal complaint.

Cunningham is neither a member of the House Republican leadership nor the chairman of a major committee, but his guilty plea does add to the GOP's mounting ethical woes. Rep. Tom DeLay (R-Tex.) was forced to step down as House majority leader this fall when he was indicted in Texas for alleged violations of campaign finance law.

House Minority Leader Nancy Pelosi (D-Calif.) called Cunningham's crime "an egregious action that strikes at the very heart of our democracy and dishonors the people he has been elected to represent."

Carl Forti, a spokesman for the National Republican Congressional Committee, scoffed at that line of attack. Congressional elections are won or lost district by district, he said, and to unseat an incumbent Republican, Democrats will have to come up with a better argument than associating the Republican with another politician's malfeasance.

"I don't know of any members of Congress who has lost because of something someone else did or didn't do," Forti said.

Other Republicans were not so sure. Douglas MacKinnon, who was an aide to former Senate majority leader Robert J. Dole, said Cunningham may not be a household name, but "when something like this happens, when you get a guilty plea, you get people that are not only more and more troubled by it, but are frankly disgusted."

Cunningham's resignation is not likely to tilt the balance of power in the House in the short run. His district, just north of San Diego, is heavily Republican. Under California's election code, Gov. Arnold Schwarzenegger (R) has 14 days from the official day Cunningham vacates his post to set a date for a special election. That election must be held within 120 days.

Research database editor Derek Willis and researcher Richard S. Drezen contributed to this report.


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