Randall Harold "Duke" Cunningham

Quick Summary

Randall "Duke" Cunningham, a decorated Vietnam War fighter ace and eight-term Republican congressman from San Diego, California, accepted at least $2.4 million in bribes from defense contractors; the largest bribery sum involving a member of Congress at the time of his conviction. In exchange, Cunningham steered tens of millions of dollars in defense and intelligence contracts to the bribers. Infamously, he wrote a "bribe menu" on his congressional stationery listing the amounts required for contracts of various sizes. He pleaded guilty on November 28, 2005, to conspiracy and tax evasion, and was sentenced to eight years and four months in federal prison.

Timeline of Events

The Details

Cunningham's bribery was remarkable for its brazenness and the literal price list he created. As a senior member of the House Appropriations Subcommittee on Defense and the House Permanent Select Committee on Intelligence, Cunningham had the ability to direct classified "earmarks", spending items inserted into defense and intelligence budgets, to specific contractors without public scrutiny.

The "bribe menu" found during the investigation was written on Cunningham's official congressional stationery. It specified: for the first $16 million in contracts steered to a company, the bribe was $140,000. For each additional million above $16 million, the price was $50,000. This brazen document became the most iconic artifact of the case.

The Home Sale Scheme

The scheme that ultimately exposed Cunningham involved his Del Mar Heights home. In November 2000, Mitchell Wade's company MZM purchased the home for $1,675,000; roughly $700,000 above its market value as determined by comparable sales. Wade then resold the home at a $700,000 loss. The overpayment was, in effect, a $700,000 bribe disguised as a real estate transaction. Cunningham used the proceeds to buy a $2.55 million mansion in Rancho Santa Fe.

The Yacht and Other Gifts

Wade purchased a 42-foot yacht, renamed the "Duke-Stir," and allowed Cunningham to live aboard it at the Capital Yacht Club in Washington, D.C., rent-free. Cunningham also received a Rolls-Royce, antique commodes costing between $7,200 and $11,000, Persian rugs, a $13,500 antique Louis-Philippe commode, jewelry for his wife, and direct cash payments.

The Contracts

In exchange for the bribes, Cunningham steered tens of millions of dollars in defense and intelligence contracts to MZM, Inc. and ADCS, Inc. (owned by Brent Wilkes). Many of these contracts were classified, involving programs in the intelligence community. MZM grew from a tiny firm to receiving $163 million in government contracts, almost entirely due to Cunningham's earmarks. Much of MZM's "work" involved document scanning and digitizing; relatively mundane tasks awarded at inflated prices.

What Happened

Cunningham pleaded guilty on November 28, 2005 to conspiracy to commit bribery, mail fraud, wire fraud, and tax evasion. He resigned from Congress the same day. On March 3, 2006, U.S. District Judge Larry Burns sentenced him to eight years and four months in federal prison, plus ordered $1.8 million in restitution and $1.85 million in back taxes.

Mitchell Wade pleaded guilty in February 2006 to conspiracy, bribery, and election fraud. He was sentenced to 87 months. Brent Wilkes was convicted in November 2007 on 13 counts of conspiracy, bribery, and money laundering, and was sentenced to 12 years. Wilkes's sentence was later reduced on appeal.

Cunningham served approximately seven years and was released in June 2013. The case prompted reforms in congressional earmarking, contributing to eventual moratoria on earmarks adopted by both the House and Senate. Reporter Marcus Stern and his colleagues at the San Diego Union-Tribune won the Pulitzer Prize for National Reporting in 2006 for their coverage.

Financial Impact

The bribes consisted of: the ~$700,000 home sale overpayment, the yacht (~$140,000), the Rolls-Royce, antiques and furnishings, and cash payments totaling over $2.4 million. In return, Cunningham steered contracts worth well over $100 million to his bribers, representing an enormous return on investment for the corrupt contractors and a massive loss for taxpayers.

Connections

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