----- Original Message -----
From: American Progress Action Fund <progress@americanprogressaction.org>
Date: Thursday, May 4, 2006 11:51 am
Subject: Progress Report: Sex, Lies, and Government Contracts
To: xxxx
> AMERICAN PROGRESS ACTION FUND
> The Progress Report
> by Judd Legum, Faiz Shakir, Nico Pitney
> Amanda Terkel and Payson Schwin
> www.progressreport.org
> 5/4/2006
>
> For news and updates throughout the day, check out our new blog at
> ThinkProgress.org.
> CORRUPTION
> Sex, Lies, and Government Contracts
>
> The most extensive federal corruption scandal in a century is
> growing. In March, former Rep. Randy "Duke" Cunningham (R-CA) was
> sentenced to more than eight years in federal prison (the longest
> sentence ever given to a member of Congress) for accepting $2.4
> million in bribes in exchange for lucrative defense contracts. Yet
> Cunningham's crimes, the "magnitude and duration" of which are
> compared to the Teapot Dome scandal of the 1920s, may end up a
> mere prelude. According to recent reports, federal investigators
> have traced the outlines of a far more extensive network of
> suspected corruption, involving multiple members of Congress, some
> of the nation's highest-ranking intelligence officials, bribery
> attempts including "free limousine service, free stays at hotel
> suites at the Watergate and the Westin Grand, and free
> prostitutes," tens of millions of dollars in federal contracts
> awarded under dubious circumstances, and even efforts to influence
> U.S. national security policy by subverting democratic oversight.
>
> THE RINGLEADER: At the center of the storm is California defense
> contractor Brent Wilkes -- aka "Co-Conspirator #1" in government
> documents -- "who gave more than $630,000 in cash and favors" to
> Cunningham "for help in landing millions of dollars in federal
> contracts." Wilkes devoted much of his 20-year career to
> "developing political contacts in Washington," a task at which he
> excelled, serving recently both as a county finance co-chairman of
> Gov. Arnold Schwarzenegger's (R-CA) campaign and as the state
> finance co-chairman for President Bush. "Wilkes, his family
> members and his employees were heavy campaign contributors to
> several members of Congress," and he frequently invited members --
> including Cunningham, Rep. Tom DeLay (R-TX), and House Speaker
> Dennis Hastert (R-IL) -- on chartered corporate jets. The efforts
> paid off handsomely: "Wilkes won tens of millions of dollars worth
> of defense contracts for his companies through the process of
> closed-door congressional earmarking of the federal budget."
> Indeed, "many of the contracts Wilkes secured" were for projects
> the Pentagon never even requested. Wilkes has thus far avoided any
> criminal charges, but federal officials are investigating
> instances of quid pro quo, since the "timing of Wilkes' many
> political donations closely parallels the approval of earmarks for
> Wilkes' companies."
>
> 'RED LIGHTS ON CAPITOL HILL': For more than a decade, Wilkes
> curried favor with lawmakers and CIA officials by hosting weekly
> parties at lavish hospitality suites at the Watergate and Westin
> hotels in Washington. Guests would gamble, socialize, and
> sometimes receive prostitutes; according to Harper's magazine, the
> festivities "began early with poker games and degenerated" into
> what one source described "as a 'frat party' scene -- real
> bacchanals." Mitchell Wade, another defense contractor who pleaded
> guilty in February to bribing Cunningham, has "told federal
> prosecutors that he periodically helped arrange for a prostitute
> for the then-congressman." But investigators are digging for more:
> FBI agents "have fanned out across Washington, interviewing women
> from escort services, potential witnesses and others who may have
> been involved in the arrangement," attempting to determine
> "whether any other members of Congress, or their staffs, may also
> have used the same free services." Last week, a reporter for the
> San Diego Union-Tribune said that "as many as a half dozen other
> Congressmen" may ultimately be implicated in the scandal. (Several
> have already denied ever attending Wilkes' parties.) Also,
> investigators are reportedly "trying to determine whether
> Cunningham and other legislators brought prostitutes to the hotels
> or prostitutes were provided for them there"; there is speculation
> that Wilkes may be subject to felony federal sex-trafficking
> charges if the Virginia-based limousine service he used
> transported the prostitutes into Washington.
>
> CIA'S NO. 3 ADMITS ATTENDING PARTIES: The highest-ranking CIA
> official to admit he attended the poker parties thrown by Wilkes
> is Executive Director Kyle "Dusty" Foggo, the agency's third-
> ranking official. (Foggo even "occasionally hosted the poker
> parties at his house in northern Virginia," though he denies ever
> seeing prostitutes at the gatherings.) Foggo's relationship with
> Wilkes goes back 30-plus years; the two were roommates in college,
> best men at each others' weddings, and even "named their sons
> after each other." By the 1980s, Foggo had joined the CIA and "was
> sent to Honduras to assist the Nicaraguan Contra rebels," where
> his "position was essentially a contracting officer -- he could
> get anyone anything they needed." Meanwhile, Wilkes had
> established himself in Washington and made his living "ferrying
> congressmen to Central America, where he would introduce them to
> Foggo and the Contras." Foggo's connections to Wilkes and fellow
> contractor Mitchell Wade are now the focus of an investigation
> into CIA contracts by the agency's inspector general, first made
> public in March. One of Wilkes' companies, Archer Logistics, won a
> contract to provide supplies to CIA agents in Afghanistan and Iraq
> despite having "no previous experience with such work, having been
> founded a few months before the contract was granted."
>
> CIA DIRECTOR GOSS TIED TO SCANDAL? Last week, Harper's magazine
> reported that party-goers "under intense scrutiny by the FBI are
> current and former lawmakers on Defense and Intelligence
> committees -- including one person who now holds a powerful
> intelligence post." CIA Director Porter Goss is perhaps the only
> individual who fits such a description. ("This is horribly
> irresponsible. He hasn?t even been to the Watergate in decades," a
> CIA spokeswoman said. When asked if Goss had attended Wilkes'
> parties at the Westin or other locations, she repeated the denial.
> "It's horribly irresponsible. Flatly untrue.") But the alleged
> links between Goss, Foggo, and Wilkes have led some to return to
> questions raised when Goss initially selected Foggo to be
> executive director in November 2004. At the time, the decision was
> viewed with skepticism since Foggo's previous position was as a
> "midlevel procurement supervisor," and because following his
> unexpected selection, "Porter Goss lieutenant Patrick Murray went
> to then-Associate Deputy Director of Operations for
> Counterintelligence Mary Margaret Graham and informed her that if
> anything leaked about other Goss appointments -- in particular,
> Foggo's -- she would be held responsible." Project on Government
> Oversight fellow Jason Vest reported last week that much of
> Foggo's counterintelligence file "has to do with various social
> encounters over the years, none of which he?s been deceptive about
> when polygraphed, and all of which have been deemed to be of no
> threat to operational security -- but are still the types of
> things that could be embarrassing for Goss and the Agency." Vest
> suggests the latest reports raise important questions about the
> "relationship between Foggo and Wilkes, and the relationship of
> each with Goss."
>
> EVEN THE LIMO SERVICE IS CORRUPT: Another piece of the puzzle is
> Shirlington Limousine and Transportation Inc., the firm that
> Wilkes used to "transport congressmen, CIA officials, and perhaps
> prostitutes to his Washington parties." Shirlington's president,
> Christopher Baker, has a "lengthy history of illegal activity,"
> detailed in his 62-page rap-sheet which "runs from at least 1979
> through 1989 and lists charges of petty larceny, robbery,
> receiving stolen goods, assault, and more." Shirlington Limo also
> "operates in what looks to be a deliberately murky way. The limo
> company does business under at least four different names; in
> addition, the office addresses listed on its business filings
> regularly change. A number of those office addresses are actually
> at residential buildings or business suites, and calls to the
> listed phone numbers are taken by an answering service." The
> company was sued in 2004 for failing to make payments on buses it
> had purchased, has received eviction notices from its offices, and
> even had its federal license revoked by the Federal Motor Carrier
> Safety Administration in both 2001 and 2004. Despite all of this,
> the Department of Homeland Security last fall awarded Shirlington
> a $21 million contract "to provide transportation, including limo
> service for senior officials." Shirlington also won contracts
> "with the Department of Housing and Urban Development (for
> $519,823) and...the Federal Highway Administration (for
> $142,000)." What role did Wilkes play in Shirlington receiving
> these federal contracts?
>
> THE DEFENSE APPROPRIATIONS COMMITTEE 'CABAL': A common thread
> links the members of Congress that Wilkes courted most
> aggressively, such as Cunningham and Reps. Jerry Lewis (R-CA),
> Duncan Hunter (R-CA), and John Doolittle (R-CA). All were (or
> still are) on subcommittees overseeing defense and intelligence
> spending. On Monday, prominent conservative strategist Ed Rollins
> described the main players in the scandal as a "real little cabal
> on the defense appropriations committee." In particular, the House
> Appropriations subcommittee on defense is "aggressively courted
> not just by defense contractors, but by lobbyists for foreign
> governments interested in swinging US defense spending in certain
> directions," investigative journalist Laura Rozen notes. "It is
> really where the checks are signed, and decisions about funding
> sometimes wholly un-debated aspects of U.S. national security
> policy are made." Indeed, many of the figures tied to the scandal
> have histories of involvement in reactionary conservative elements
> of U.S. foreign policy: Kyle Foggo worked extensively with the
> Nicaraguan contras, Mitchell Wade headed a White House-contracted
> group called the "Iranian Democratization Foundation", and Wilkes
> was reportedly set to receive a contract to "create and run a
> secret plane network" for the CIA before his links to Cunningham
> were made public. The roots of this scandal may be as much in
> profiteering as they are in "this club's conviction that the law
> is an impediment to the national security cause, that the way to
> run things is through these informal networks."
>
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