Diego Union Tribune
September 17, 2005
House panel OKs Cunningham legal fund
By Joe Cantlupe and Jerry Kammer
COPLEY NEWS SERVICE
WASHINGTON – The House ethics committee has given approval for Rep. Randy "Duke" Cunningham to set up a legal defense fund to handle his mounting bills stemming from a federal grand jury investigation.
"Duke is pleased with the action of the committee," said Harmony Allen, Cunningham's chief of staff.
The senior Republican and Democrat on the House committee approved Cunningham's request July 28 to establish a legal defense trust fund in a letter dated Aug. 10, and reportedly delivered to Cunningham's attorneys this week.
In approving the request, committee chairman Rep. Doc Hastings, R-Wash., and ranking Democrat Rep. Alan B. Mollohan of West Virginia noted a fund "has become necessary because of legal expenses arising in connection with a grand jury investigation that concerns your official duties and bears on your reputation and fitness for office."
The investigation involves Cunningham's relationship with Mitchell Wade and the defense-contracting company he founded, MZM Inc. In June, agents from the U.S. Attorney's Office in San Diego, the FBI, the Internal Revenue Service and the Defense Criminal Investigative Service, raided Cunningham's Rancho Santa Fe home and MZM's corporate headquarters in Washington.
In filings connected with a civil suit, federal prosecutors claimed Cunningham "demanded and received" a bribe from Wade.
Wade purchased the Republican congressman's Del Mar-area house in November 2003 for $1.675 million, put it back on the market almost immediately and sold it nearly nine months later at a $700,000 loss.
Congressional rules require that a trustee oversee legal defense funds. Kenneth Batson, who has served as Cunningham's campaign treasurer, will be trustee of the Randall Cunningham Legal Expense Trust.
Once the fund is established, contributors can donate up to $5,000 per year. Cunningham must file quarterly reports to the committee and note any contribution of more than $305 in a 12-month period in an annual financial disclosure statement.
Meanwhile, the watchdog group Common Cause, citing Cunningham's real estate transaction with Wade, called on the lawmaker to step down from two committee assignments: the House Permanent Select Committee on Intelligence and the defense appropriations subcommittee.
The group also called on House Speaker Dennis Hastert to remove Cunningham from both assignments. In a letter to Hastert, Common Cause president Chellie Pingree claimed that allegations against Cunningham "call into question his ability to exercise effective and trustworthy oversight in his role as a member of the Intelligence Committee, as well as his ability to manage taxpayer dollars."
Pingree also called on the House ethics committee to launch an investigation into Cunningham's conduct. In a letter to the committee, officially called Committee on Standards of Official Conduct, she wrote that Cunningham's announced decision to retire when his two-year term expires "is no reason to excuse him from an investigation of these serious charges."