CNN.com - Prosecutor in DeLay case subpoenas records from defense contractors - Dec 13, 2005

California companies tied to Cunningham bribery case

WASHINGTON (AP) -- A Texas prosecutor has issued subpoenas for bank records and other information of a defense contractor involved in the bribery case of a California congressman as part of the investigation of former House Majority Leader Tom DeLay.

District Attorney Ronnie Earle issued subpoenas late Monday afternoon for California businessmen Brent Wilkes and Max Gelwix, records of Perfect Wave Technologies LLC, Wilkes Corp. and ADCS Inc. in connection with a contribution to a fundraising committee at the center of the investigation that led to DeLay's indictment on money laundering charges.

Perfect Wave contributed $15,000 in September 20, 2002 to Texans for a Republican Majority, a fundraising committee founded by DeLay, R-Texas.

Former Rep. Randy "Duke" Cunningham resigned in late November after pleading guilty to taking $2.4 million in bribes to steer defense contracts to companies.(Full Story)

Lawyer: 'We're not concerned about it'
"He can subpoena all he wants, there's nothing there," said DeLay attorney Dick DeGuerin. "I think he's trying to dig himself out of a hole. We're not concerned about it."

The subpoenas also seek correspondence and internal accounting records.

Wilkes, head of Wilkes Corp., is one of four unnamed coconspirators listed in Cunningham's plea agreement, Wilkes' attorney, Michael Lipman of San Diego, has said. Lipman did not immediately return calls for comment.

Defense contractor ADCS and Perfect Wave Technologies are subsidiaries of Wilkes Corp.

Gelwix was listed in federal campaign records last year as president and CEO of Perfect Wave Technologies. A message left at his office was not immediately returned.

Wilkes' company also hired Alexander Strategies, a consulting firm that employed DeLay's wife Christine. His private jet company, Group W Transportation, provided flights to DeLay three times. DeLay reimbursed Group W as required, records show.

DeLay was forced to step aside as majority leader in late November after he was indicted on state charges of conspiracy to violate Texas election laws. A second grand jury indicted him on charges of conspiracy to launder money and money laundering charges.

The initial charges have been dismissed, but a judge has let stand the latter charges and DeLay faces possible trial on them.

Earle alleges that DeLay and two coconspirators funneled $190,000 in corporate contributions through the Texas political committee and an arm of the National Republican Committee to seven GOP state legislative candidates.

Earle alleges DeLay and his two associates were trying to circumvent Texas' law prohibiting spending corporate money on campaigns, except for administrative expenses.

DeLay, who denies wrongdoing, has been pressing for a quick resolution to his case so he can regain his majority leader job before his colleagues call for new leadership elections.

But Earle on Monday asked a judge to halt DeLay's trial while he appeals the dismissal of the conspiracy charge. The judge in the case has said he is unlikely to move forward with the case while the district attorney appeals, but set a pretrial hearing for December 27.

No intelligence breaches surface against 'Duke' North County Times - North San Diego and Southwest Riverside County News


No allegations of trading secrets for cash have surfaced since former 50th District congressman Randy Cunningham resigned Nov. 28, a spokesman for the U.S. House of Representatives intelligence committee said Monday.

During the five-month period that Cunningham was being investigated for taking bribes from defense contractors, he continued to have full access to top-secret, classified briefings from the Central Intelligence and National Security agencies as well as numerous other U.S. intelligence groups.

Watchdog groups and some members of Congress have expressed concerns that Cunningham, who has admitted taking more than $2.4 million in bribes between 2001 and 2005, may have been susceptible to blackmail or other forms of corruption in relation to his access to national secrets.

Cunningham was a member of the Permanent Select Committee on Intelligence since 2001 and head of its subcommittee on terrorism and human intelligence. He is now being investigated to see if any improprieties occurred in his role on those congressional panels.

The committee oversees $40 billion in annual spending on spy agencies. Much of that money is directed to the Pentagon's so-called "black budget" for super-secret projects, many of which are awarded on a no-bid basis and not subject to oversight in the normal defense contracting process.

Intelligence committee spokesman Jamal Ware said there was never an attempt by any federal agency or member of Congress to restrict or end Cunningham's access. He added that there have been no accusations of impropriety regarding Cunningham and national secrets.

"There have been zero allegations of any wrongdoing, but as the chairman said, we have to be certain," Ware said from his office on Capitol Hill.

In addition to his role on the intelligence committees, Cunningham was a member of the Appropriations Subcommittee on Defense. That also gave him access to classified documents.

John Scofield, a GOP Appropriations Committee spokesman, told the North County Times last week that shortly after the federal investigation began, committee staffers examined the projects Cunningham worked on and concluded each was vital to the nation's defense and took no further action.

Investigation ongoing

Ware said intelligence committee Chairman Pete Hoekstra, R-Michigan, has met with committee members and staffers to discuss Cunningham's committee activities and the parameters of the investigation he ordered earlier this month.

"The staff will conduct the investigation, and undoubtedly there will be consultation with the Justice Department," Ware said. "There has to be a certainty that everything was done aboveboard. Members on both sides of the aisle take the security of the committee very seriously."

Hoekstra, who did not return telephone calls from the North County Times seeking comment, has not set a timetable for completing the investigation, Ware said.

Justice Department officials in Washington did not return calls seeking comment on whether federal officials took any action or expressed any concern between June and November about Cunningham's access to national secrets.

The 64-year-old Cunningham became the focus of a San Diego federal grand jury investigation led by the U.S. attorney's office in June. The investigation began after it was reported that a defense contractor had paid Cunningham $700,000 more for a home in Del Mar Heights than he would end up selling it for less than a year later.

On Nov. 28, Cunningham pleaded guilty to one count of bribery and one count of tax evasion, acknowledging he had accepted more than $2.4 million in bribes in exchange for steering Pentagon contracts to two defense contractors.

'Open game'

According to the plea agreement signed by Cunningham, if prosecutors discover any criminal acts involving someone other than his co-conspirators, the disgraced former lawmaker could face additional prosecution.

"If he was committing other offenses in other jurisdictions and hasn't told us, he's open game," assistant U.S. Attorney Phillip Halpern in San Diego said Monday.

The 33-page plea agreement, in which Cunningham admitted taking bribes on more than two dozen occasions and filing false tax returns from 2001 to 2004, states "this plea agreement is limited to the United States Attorney's Office for the Southern District of California and cannot bind any other federal, state or local prosecuting, administrative or regulatory authorities."

The known co-conspirators in the case are Mitchell Wade, founder of the defense firm MZM Inc., Brent Wilkes, owner of the Poway defense firm ADCS Inc., and New York developer Thomas Kontongiannis.

Court documents allege that Cunningham took money and goods from the co-conspirators in the form of real estate deals, antiques and other gifts, including the house deal and a rent-free stay on Wade's yacht in Washington.

Plea deals could be on the way

Former prosecutors and other sources close to the investigation say they expect plea deals involving the co-conspirators to emerge soon, largely because of Cunningham's agreement to tell federal authorities everything about the deals he reached with those individuals.

During the summer, federal authorities raided the homes and offices of the three co-conspirators, carting off boxes of evidence.

IRS spokeswoman Tami Stine in San Diego said Monday that additional plea deals "may be in the wind."

FBI spokeswoman April Langwell in San Diego confirmed that deals could be near.

"Agents are getting their ducks in a row," she said, adding she could not be more specific.