Contractor Plans Guilty Plea for Bribe-Case Role

Randall "Duke" Cunningham pleaded guilty to tax evasion and conspiracy to commit bribery. (Lenny Ignelzi - AP)

Washington defense contractor Mitchell J. Wade is expected to enter a guilty plea in federal court here this morning for his role in the bribery-related case involving former Rep. Randall "Duke" Cunningham (R-Calif.), according to sources familiar with the investigation.

Wade, who founded District-based MZM Inc., started cooperating months ago in the inquiry of Cunningham's alleged trading of "earmarks" in congressional appropriations for $2.4 million in cash, furniture, boats and house payments, sources said. The probe began last June after the San Diego Union-Tribune reported that Wade bought Cunningham's San Diego home and then resold it months later for a $700,000 loss. A short time later, another newspaper reported that the congressman also was living rent-free on Wade's 42-foot yacht while in Washington.

Cunningham first denied the reports, but then he pleaded guilty last November to tax evasion and conspiracy to commit bribery and resigned from Congress.

The sources, who spoke on condition of anonymity because the agreement has not yet been presented in court, said Wade is expected to admit to his sweetheart purchase of Cunningham's home and to providing hundreds of thousands of dollars in cash and gifts to the congressman. At the time, he was using his position to set money aside for defense and intelligence programs for contractors, one of which was identifiable in Cunningham's plea agreement as Wade's MZM.

Wade is also expected to acknowledge that he attempted to improperly influence a Defense Department contracting and procurement official with inducements and gifts, including offers to hire members of his family, the sources said.

The plea agreement will note also how Wade and his employees gave tens of thousands of dollars in campaign contributions to two other House members. There is no indication that the House members face any liability.

Wade's attorney, Reginald Brown, had no comment last night. Wade has been negotiating a plea agreement with federal prosecutors in the U.S. Attorney's Office in Washington for several months, according to the sources. The deal is expected to be presented to U.S. District Judge Ricardo Urbina this morning.

Channing Phillips, a spokesman for the U.S. Attorney's Office, declined comment about the case yesterday.

MZM grew from a small company in 2002 to one last year that had more than $50 million in defense contracts and 400 employees, many with high security clearances. The company was sold last fall to a New York investment firm and renamed Athena Innovative Solutions Inc.