The latest in the saga of Republican congressman Randy "Duke" Cunningham and the graft he has taken from his benefactor, defense contractor Mitchell Wade: About two dozen demonstrators gathered outside Rep. Randy "Duke" Cunningham's gated driveway Friday to protest his real-estate dealings with a defense contractor that they dubbed "Mansiongate."
The group chanted slogans and waved homemade signs that accused Cunningham of profiting from the war in Iraq and claiming his vote was for sale. They asked for Cunningham to disclose his financial transactions involving the defense contractor, MZM Inc., and some called for his ouster.
Many of the demonstrators linked their concerns about Cunningham's transaction with a defense contractor to the war in Iraq. Rodney Galloway of Ramona said he attended the noontime rally because he supports pulling the troops out of Iraq and to protest Cunningham's conduct.
More after the flip about "Duke" stuffing his pockets while diverting millions of dollars to his defense-contractor buddy.
MZM owner Mitchell Wade bought Cunningham's house for $1,675,000 inNovember 2003 and swiftly put it back on the market for about the same price. It sat on the market for almost nine months until it sold for $975,000.
It was later reported that Cunningham has been living aboard a 42-foot-yacht owned by Wade. On Friday the newspaper reported the FBI had opened an inquiry into the real estate transaction.
Cunningham used the money from the initial sale to buy the $2.55 million house in Rancho Santa Fe where protesters gathered today.
"Buy your mansion, buy your yacht, while our troops die in Iraq," was one the chants offered by the protesters.
"He sold out to defense contractors and our kids are being killed because of it," said Ramona Byron of Oceanside.
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The protest was organized by the North County Coalition for Peace and Justice.
Another new development: The FBI has opened an inquiry into Cunningham's "sale" of the Del Mar house to defense contractor Wade for about $700,000 over fair market value.
The FBI has opened an inquiry into Rep. Randy "Duke" Cunningham's 2003 sale of his Del Mar house to a defense contractor, who later sold it at a $700,000 loss, a Justice Department official said yesterday.
The action comes amid fresh signs of unusual personal ties between Cunningham and the defense contractor, who named a 42-foot yacht after the Rancho Santa Fe Republican and turned it over to him to use while in Washington.
The Justice Department official, who spoke on the condition that he not be identified because of the inquiry's preliminary nature, would not comment about its scope. However, the head of the FBI office in San Diego had reflected the agency's curiosity a day earlier.
"We are very interested in what has been reported to date, and we welcome more information," Dan Dzwilewski, special agent in charge of the FBI's San Diego office, said Wednesday. "Public corruption matters represent one of the highest priorities of the FBI."
Here's the 42-foot yacht that defense contractor Wade bought and is "loaning" to Cunningham for "Duke" to live on while doing "the people's business" (heh) in Washington:
Cunningham has been living aboard a 42-foot yacht at the Capital Yacht Club along the banks of the Potomac River. Wade owns the yacht, named the Duke-Stir, according to U.S. Coast Guard records. The name appears to be a play on Cunningham's nickname.
Several years ago, Cunningham inserted a provision in the District of Columbia budget for $3 million to refurbish the waterfront where the yacht is docked:
Cunningham previously lived in the same slip aboard a 65-foot yacht called the Kelly C. Coast Guard records list Cunningham as the owner of the Kelly C.
In 1998, when Cunningham was living aboard the Kelly C, he used his position on the defense appropriations subcommittee, which oversees the District of Columbia's budget, to earmark $3 million to refurbish the waterfront where the yacht was docked.
In the same article, local real estate experts convincingly prove that the house Cunningham sold to Wade was worth less than $1 million -- even though Wade paid Cunningham $1,675,000 for it.
several San Diego Realtors and appraisers who reviewed the Multiple Listing Service records during the period said the comps, which include pictures of the interior and exterior of the homes, show that the house was worth less than $1 million when Wade paid Cunningham $1,675,000.
"There is no logical explanation of comps that could have supported a value of $1,675,000 in November 2003," San Diego real estate appraiser Todd Lackner said after reviewing the records. "There was only one house sale that sold in this price range for $1,665,000 on June 11, 2003. This was an incredibly superior property. The true comps in November 2003 would have been closer to the lower $900,000 range."
Wade put the house back on the market for $1,680,000 in November 2003 during a period when houses frequently were drawing multiple bids above the asking price as soon as they were placed for sale. However, the Del Mar house stayed on the market for more than eight months before selling in October 2004 for $975,000.
After reviewing the comps, Realtor Jacque Baker of Prudential Cal Realty put the value of Cunningham's Del Mar home in November 2003 at "less than $1 million," citing two properties of roughly the same size that sold for about that price even though they had upgrades - and, in one case, panoramic ocean views - which Cunningham's house did not.
A columnist in the Union-Tribune says this scandal will end Republican Cunningham's tenure in
Congress:
Duke's done.
One way or another, an under-the-table real-estate deal will end his long run in Congress.
As the columnist notes, Cunningham has had prior bouts of unsavory behavior, mostly excused by his status as a Vietnam War hero, but despite the excuses offered by Repub hacks like DeLay and Hunter, the stain of this mess will endure:
Who can forget his obscene gesture while addressing cancer patients? Or his recommendation that House Democratic leaders and Vietnam war protesters be rounded up and shot?
Well, North County obviously likes its war heroes feisty and offers them plenty of slack.
On Tuesday, I called up Rep. Duncan Hunter, R-El Cajon, to get his take on his old friend's real-estate problem.
Hunter was inclined to overlook the whole thing. "I just saw Duke and he told me, 'I've been totally above-board,' " Hunter said. "That's good enough for me. He's an American hero and should be given the benefit of the doubt."
Well, the hero card plays most of the time, but now we're talking money - the pungent whiff of corruption - not who's the most passionate patriot.
In late 2003, Cunningham wanted to sell his house near Del Mar Heights Road, which he bought in 1988. His house, while large, was unspectacular by Del Mar's tony standards.
Mitchell Wade, a Pentagon contractor whose livelihood depended on Cunningham's defense appropriations subcommittee, agreed to buy the house for $1,675,000 in a private, no-commission deal.
Elizabeth Todd, a Del Mar real-estate agent and a faithful donor to Cunningham's campaigns, pulled up some supposed comps and helped suggest a price.
A month later, Wade put the house on the market, initially asking $1,680,000. Months later, despite a white-hot housing market, the sale price fell to $975,000, a $700,000 loss.
Todd received commissions on Wade's sale of the Del Mar Heights house and Cunningham's purchase of a $2.55 million house in the Ranch.
Wade took a bath on the house deal, but his multimillion-dollar Pentagon contracts spiked after the sale.
Lucky Cunningham. Lucky Todd. Lucky Wade. Everybody made out like bandits.
Now they're looking like bandits.