US: Pentagon Orders Investigation Of Cunningham's MZM Earmark

Undersecretary of Defense Stephen A. Cambone has ordered an internal study of how funding earmarked in a bill by then-Rep. Randy "Duke" Cunningham (R-Calif.) led to contracts for MZM Inc. to do work for the Pentagon's newest intelligence agency, the Counterintelligence Field Activity, a Defense Department spokesman said.

Cunningham pleaded guilty last November to tax evasion and taking bribes from contractors, including the former president of MZM, Mitchell J. Wade. Wade pleaded guilty last month to bribery-related charges and to making illegal campaign contributions to Cunningham and other legislators.

In documents filed in Cunningham's case, prosecutors said that in fiscal 2003 legislation, the congressman, who was a member of the House Permanent Select Committee on Intelligence, set aside, or earmarked, $6.3 million for work to be done "to benefit" the Counterintelligence Field Activity (CIFA), created in 2002. Federal prosecutors have been looking into whether Pentagon personnel committed crimes in awarding CIFA contracts to MZM.

Cmdr. Greg Hicks, a Pentagon spokesman, confirmed yesterday that Cambone has ordered an internal inquiry. Hicks said he was "unable to comment on MZM contracts or related matters since they are the subject of ongoing investigations by the appropriate organizations in the department and the U.S. government."

Hicks added that Cambone's request to CIFA focused on the undersecretary's "desire to understand the temporal relationship between the congressional earmark and contract actions taken by the department."

Court documents show that in at least one case Wade drafted the language of an earmark that Cunningham submitted, which later led to a contract for MZM. Wade also hired the son of the Defense Department official who had authority over a contract later given MZM, the documents show.

Meanwhile, new information continues to emerge about MZM and its activities.

In 2004, three MZM employees served as staff consultants to the presidential commission investigating prewar Iraq intelligence, which was run by federal Judge Laurence H. Silberman and former senator Charles S. Robb (D-Va.). One of the three was retired Lt. Gen. James C. King, who then was a senior vice president of MZM for national security. King, who before joining MZM had been director of the National Imagery and Mapping Agency, played a consultant's role in the establishment of CIFA in 2002 before MZM received its first contracts from that agency.

The Silberman-Robb commission report in 2005 recommended that CIFA play a bigger role in the government's counterterrorism activities. In an interview, Silberman said King was not involved in the commission's recommendation that CIFA get more work. "That recommendation was not from King," Silberman said. And the other two MZM employees on the commission staff worked on FBI matters, not Pentagon issues, Silberman said.

Last year, MZM was purchased by the investment firm Veritas Capital, which changed its name to Athena Innovative Solutions Inc., with King as president. A spokesman for Athena said this month that neither King nor the company will comment on MZM or matters under investigation. The fact that MZM employees had worked with the commission has been written about on War and Piece and other Web logs.

AMP Section Name:War & Disaster Profiteering
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  • 106 Money & Politics
  • 185 Corruption
  • 187 Privatization
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