From the New York Times:

Ex-C.I.A. Official Indicted in Inquiry Into Contracts

By DAVID JOHNSTON

Published: February 14, 2007

WASHINGTON, Feb. 13 — Federal prosecutors in San Diego announced on Tuesday an 11-count felony indictment charging a former high-ranking Central Intelligence Agency official with using his seniority and influence to steer contracts to a lifelong friend who had offered him a lucrative job and paid for lavish vacation travel.

The indictment charged Kyle D. Foggo, a former executive director at the C.I.A., with wire fraud, conspiracy, money laundering and failing to report vacation trips and other gifts paid for by the friend, Brent R. Wilkes, a contractor from San Diego. Mr. Wilkes who was charged with concealing his interest in the deals through shell companies and intermediaries.

Mr. Wilkes, who was included in the Foggo indictment, was charged on Tuesday in a second indictment for his role in a separate inquiry last year that resulted in the guilty plea by former Representative Randy Cunningham. Mr. Cunningham was sentenced to more than eight years in prison for accepting more than $2 million in cash and gifts. In that indictment, Mr. Wilkes was charged with providing more than $700,000 to Mr. Cunningham in return for his influence in helping to direct federal contracts to Mr. Wilkes’s principal company, ADCS, which converted paper documents to digitized computer imagery.

Mr. Foggo’s lawyer, Mark J. MacDougall, said Mr. Foggo had done nothing wrong, adding, “We’re confident that the facts will show that Mr. Foggo never abused his office or the public trust.”

Mr. Wilkes’s lawyer, Mark J. Geragos, said Mr. Wilkes had been the subject of false and damaging leaks to the news media.

“We welcome the opportunity to close this chapter of the last 18 months, which has been a campaign to destroy my client,” Mr. Geragos said. “We will now be able to confront these allegations in a courtroom head on.”

The second indictment against Mr. Wilkes accused a New York mortgage banker, John T. Michael, with obstruction of justice by providing what the indictment said was false information to a grand jury about Mr. Wilkes’s involvement in paying off a mortgage on Mr. Cunningham’s house near San Diego. Efforts to reach Mr. Michael and his lawyer on Tuesday were unsuccessful.

Mr. Foggo, in his career at the agency, was known for his work as a logistics officer, who ran a covert supply network to outposts in Afghanistan and Iraq. In 2004, he was promoted to executive director at headquarters, where he was in charge of day-to-day management. He resigned last May.

On an August 2003 vacation cited in the indictment, Mr. Wilkes paid for Mr. Foggo and his family to travel to Scotland, a trip that included $12,000 in private jet flights, a $4,000 helicopter ride to play golf and $44,000 for a stay at an estate. In December 2003, Mr. Wilkes paid $32,000 for Mr. Foggo and his family to vacation in Hawaii.

The second indictment against Mr. Wilkes charged him with providing an array of financial benefits to Mr. Cunningham, among them an $11,000 speedboat, a $5,000 notebook computer and checks totaling $100,000 that prosecutors described as a bribe. Mr. Wilkes provided Mr. Cunningham with free use of a corporate jet for cross-country trips, the indictment says.

In addition, the indictment charged that Mr. Wilkes paid for a three-day trip to Hawaii in August 2003 on which Mr. Wilkes was accompanied by Mr. Cunningham and an unidentified employee. On the trip, which cost more than $21,000, Mr. Wilkes paid cash for prostitutes, the indictment said, once giving an employee $600 to pay for two prostitutes, tipping one $500.

In return, the indictment charged, Mr. Cunningham used his influence to help Mr. Wilkes win military contracts, often through appropriations obtained by lawmakers outside the usual budgeting process. The timing of the indictment was somewhat unusual. It came two days before the expected departure of Carol Lam, the United States attorney in San Diego who is stepping down on Thursday under pressure from Justice Department officials. Her removal angered Democrats in Congress who have complained that it was politically motivated.

Although the investigation of Mr. Foggo and Mr. Wilkes had been under way for more than a year, the timing suggested that the indictments were intentionally returned before her departure. Justice Department officials were asked in recent days to review several issues before the indictments were returned, but opted not to intervene, according to lawyers involved the case.

Democrats have suggested that Justice Department officials wanted to oust Ms. Lam because of her pursuit of the Cunningham case.

Justice Department officials have denied that the Cunningham case was a factor in pressuring Ms. Lam. They have said she was asked to leave because of longstanding complaints that she failed to prosecute aggressively immigrant smuggling and violent crimes along the California border with Mexico.