What A Tangled Web We Weave

by hilzoy

Josh Marshall has another very interesting story up tonight. It concerns Mitchell Wade, a defense contractor who pled guilty to bribing Duke Cunningham about a year ago. To set the scene, recall this timeline:

1993: Mitchell Wade incorporates MZM Inc.

1993-2001: MZM reports no revenue from any government contract, or, for that matter, from anywhere else.

November 2001: MZM begins buying things for Duke Cunningham:

"In November 2001, a company check for $12,000 paid for three nightstands, a leaded-glass cabinet, an antique washstand and four armoires.

In December 2001, a $50,000 company check was sent to a mortgage banker, who in turn made out a check to Cunningham for the same amount. In January 2002, the company's American Express card was used to purchase a leather sofa and a sleigh bed for Cunningham.

In all, more than $100,000 in cash and furnishings were given to Cunningham even before MZM had posted its first revenue."

May 2002: "Although MZM had no experience with government contracts, the General Services Administration in May 2002 placed the company on a list of approved information technology service providers, a key step for the company to get business from federal agencies."

Summer, 2002: According to Cunningham's sentencing recommendation:

"In the summer of 2002, through an intermediary, Cunningham approached the seller of a 42 foot Carver yacht then named the 'Buoy Toy' (...) and eventually negotiated a price."

August 2002: "The first contract, worth $140,000, came from the White House — to provide office furniture and computers for Vice President Dick Cheney."

August 30, 2002, just two weeks later: "Wade purchased a yacht, later christened "Duke-Stir," for $140,000, according to court documents. Cunningham used the yacht, docked at the Capital Yacht Club, as his home in Washington — and the scene of parties for lobbyists and others."

Isn't that interesting? A company that has never had a government contract before, but that has been paying off a powerful Congressman, suddenly lands a contract from the Vice President's office, and two weeks later the head of that company turns around and buys a yacht for the use of that same Congressman, a yacht that the Congressman had previously negotiated to a price for. And, by an astonishing coincidence, that price was the exact same amount that the contractor's contract was for. I mean, what are the odds of that?

I've always wondered what, exactly, that contract with Cheney's office was for. Not being an investigative reporter, however, I wasn't able to find out. Luckily for all of us, the investigative reporter who broke the original Cunningham story did, and apparently he's written about it in a forthcoming book. Josh Marshall reports what he found:

"Today I got a glance at a key section of the book and it reveals that what that contract was really for was for screening the president's mail.

That's right, screening the president's mail, presumably for Anthrax and other similar biohazards. Remember, this was in mid-2002, not long after the Anthrax scare that shut down several offices on Capitol Hill. So this is a pretty important contract, a pretty sensitive task on any number of levels.

This afternoon, we've independently confirmed that this is the case. According to a knowledgeable source, the text of the contract itself refers to "threat mail technology insertion" which we believe is spook-speak for screening technology for Anthrax and other biohazards."

And Josh adds:

"So it all comes back to the same question. Why did a company like Wade's, which had no track record whatsoever and had only been approved to receive federal government contracts two months earlier, get a contract from the White House to screen the mail of the President of the United States? Was Wade actually working in concert with or as the cut out for accused fellow Cunningham briber Brent Wilkes? And what role might Doolittle and Ney have played? And what about Wade's claims of having pull with the Vice President? Is that what got him the deal?

The Wilkes-Wade business model was corrupting members of Congress and the executive branch in order to obtain pricey government contracts, often but not always for worthless products and services, and almost always stashed away in classified programs where the light of day could never expose their corrupt practices. And Wade's first contract was with the White House itself. So whose palm got greased?"

Good questions. I'd add a couple more. Screening the President's mail is a very important job. Especially after the anthrax scare, I would imagine that someone in the President's or Vice President's offices would have paid attention to that particular contract. I would also surmise that no procurement officer in the government would have risked foisting some unknown company with no track record off on the President's office, for that job, at that time, just for the sake of a bribe. Even a really large bribe. Not without an OK from someone important enough to assume responsibility for that decision.

Which leaves me with two questions. First, did Mitchell Wade, or someone working with him, have a track record we don't know about? And second, did someone in the White House sign off on this? Because the alternative is that someone outside the White House took it upon him- or herself to give this of all contracts to an unknown quantity. And I don't believe that.

***

Oh, and one more thing: in September 2002, right after Wade bought the Duke-Stir for Cunningham's use, the Pentagon awarded MZM a blanket contract for up to $250 million dollars.

"In September 2002, MZM signed a broad deal with the Pentagon, called a "blanket purchase agreement." The agreement allowed the company to negotiate defense contracts with branches of the armed forces totaling as much as $250 million over a five-year period.

Since then, the company has used the agreement, which it received without competitive bidding, to secure contracts with different branches of the armed forces for $163 million, according to Pentagon sources.

Blanket purchase agreements have existed for decades and were originally designed to provide a framework that would allow the government to speed up the purchasing process. During the late 1990s, however, abuses began to occur, a Washington expert in government contracts said Tuesday.

"They were used in a very anti-competitive way in the late 1990s, allowing what is in essence sole-source awards without bidding," said Christopher Yukins, associate professor of government contract law at George Washington University.

According to an official with Washington budget watchdog Taxpayers for Common Sense, of 90 contracts that MZM received through the blanket purchase agreement, 85 involved no competitive bidding."

And guess what some of the things MZM provided under those contracts were?

"According to an article that appeared yesterday in the San Diego Union-Tribune, one of the three main services MZM is providing to the U.S. government is something called “counterintelligence field activity.” The Union-Tribune describes it as “a highly secretive program created in 2002 by a Pentagon directive that focuses on gathering intelligence to avert attacks like the ones on Sept. 11, 2001.”

Other services include providing translators for troops stationed in Iraq, undisclosed services at CentCom Headquarters in Florida, as well as battlefield intelligence at U.S. Army intelligence installations at Fort Belvoir and Charlottesville, Va.

These are, to put it mildly, pretty important jobs — ones that, it is no exaggeration to say, many of our lives may well depend on.

And that should prompt us to ask the question: If Mitchell Wade and Co. had to lavish so much money on Duke Cunningham to get sufficient help to land all these contracts, were MZM’s services really the best on offer?

And if they were, why was MZM having such a tough time landing contracts — as reported in the Union-Tribune and the North-County Times — before the company’s CEO got so intimately involved in upgrading Cunningham’s accommodations in D.C. and back in the district?

On its website, MZM says it’s involved in providing “force protection” and dealing with improvised explosive devices, the homemade roadside bombs that are killing and maiming so many American soldiers and Marines in Iraq.

So we must also ask: Are there American servicemen and servicewomen in Iraq making do with second- or third-best because of Cunningham’s new house and fancy waterborne digs in D.C.?"

***

Recall that this is the corruption case that Carol Lam was working on before she was removed. TPMMuckraker has a good series of posts on Lam, which lay out a lot of facts, and have good links. Here's one on her record on immigration; here's one on the DoJ's failure to send her more resources to deal with immigration; and here's one on why the reasons given for asking Lam to resign don't add up.

Recall also that Lam had other people in her sights. This investigation was nowhere near over.

***

And while I'm adding things: my heart goes out to Tony Snow and his friends and family.

***

UPDATE: Reuters:

"Sen. Charles Schumer, a New York Democrat, noted that among the shifting reasons given for firing prosecutors was failure to energetically pursue voter-fraud investigations.

Schumer asked Mueller if he was aware of any FBI voter-fraud probe that should have resulted in an indictment but did not.

"Not to my knowledge," the FBI director replied."

Comments

[Jackmormon]

One possibility is that the "threat mail technology insertion" is one componant of the screening process, one that could be put in the hands of an untested player if the pay-off was helpful. I doubt that the Secret Service was willing to outsource all of its VP security responsibilities, and the anthrax letters were overblown as a threat (and targeted at media and Democrats besides).

The deal was stupid and unseemly, the quid pro quo that's shaping up looks illegal, but I'm not convinced it was a huge breach of security.

[Common Sense]

The mail scanning deal seems really fishy: assuming that MZM had no actual capabilities before they got the $140K deal, there is just no way they could have afforded to build anything.

Product development costs money and testing is enormously expensive, especially if you are dealing with bioweapons. Weaponized anthrax can only be handled in a level 3 containment facility; there aren't many of those around and I bet that renting time in them is not cheap. That's assuming you can get your hands on weaponized anthrax to test with in the first place.

Even if MZM planned on just buying some off the shelf product and slapping their logo on it, they'd still have to perform some testing...unless the contract really is a complete sham.

It might be possible that the $140K was a subcontract that was part of a much larger deal, but for life critical systems, companies are usually very conservative.

Also, I'm having trouble coming up with a small chunk of noncritical work that could be broken off without endangering the whole project. But I might just be tired.

I'd kill to see MZM's job postings from 2001-2002.

[kvenlander]

You realize what this means? Cheney installed his own private goons to go through all mail destined to the President. Pretty nice trick that.

[OCSteve]

One note about Carol Lam, she was apparently targeted before the Cunningham scandal broke. She was on the March 2 list (name crossed out). A reporter broke the Cunningham story on June 12.

OK – two notes. I keep seeing references to Lam being targeted because she was investigating Jerry Lewis. But Lam was not the responsible USA – that was Debra Yang in LA.

Doesn’t change the larger story – but these are often repeated points that are questionable at best.

[J Thomas]

OCSteve, the right time to target Lam wasn't after the scandal broke out, it was after she started to seriously investigate Cunningham -- or someone else they didn't want investigated.

If the scandal broke out June 12, when did they first notice she was going after Cunningham? Could it have been before March 2? Did she perhaps start collecting evidence more than 3 months before the scandal broke?

Your point seems questionable.

[OCSteve]

J Thomas: I believe that the story was broke by the investigative reporter noted. That is, the USA did not know about it, no one did, before the story broke.

I could be wrong…

[hilzoy]

OCSteve is right. Lam was on a list that existed before the Cunningham story broke open, and it was broken by the San Diego reporter, not by the US Attorney's office or any other law enforcement people.

That said, however, the list was in flux throughout. (As I know from having seen roughly a gzillion different iterations of it, while skimming the document dump. Ugh.) Some people who were rated 'strong' on that list were later fired; some who were rated 'weak' were not. If we assume that what got her onto that list was also what accounted for her staying on it and eventually being fired, then it follows that she wasn't fired for the Cunningham investigation, or any of the investigations that grew out of it. But I'm not sure we can assume that.

[hilzoy]

Somewhat OT: Atrios has posted a -- pitiful? funny? -- video of a hearing on the meeting described in this story. (The General Services Administration has a meeting in which one of Rove's people comes down to discuss the results of the 2006 elections, and how the GSA can help elect Republicans in 2008.)

It's worth watching it, even though the best parts don't come until the 2nd half, just to see all those nice slides with titles like: "2008: Top Democrat Targets" and "2008: Battle For The Senate". It's a pity that one question that's asked about halfway through doesn't come first, and then stay emblazoned at the top of the screen, namely:

"Can you tell us what, if anything, these slides hve to do with the GSA's core mission of procuring supplies and managing Federal buildings?"

It would also help to know at the outset that there are various GOP political appointees who have been deposed about this meeting, and who have reported that the very woman who is testifying in this video, and who has such a complete loss of memory about the meeting in question, said at that meeting:

"How can we use different GSA projects, building openings and the like, to further aid other Republicans?"

It would also be nice to have a ticker at the bottom with all the provisions of the Hatch Act scrolling by.

Our tax dollars at work.

[Frank]

Hilzoy- I think that topic deserves a front page post don't you? Digby also has done some posts about that meeting.

[Model 62]

"one of the three main services MZM is providing to the U.S. government is something called “counterintelligence field activity.” The Union-Tribune describes it as “a highly secretive program created in 2002 by a Pentagon directive that focuses on gathering intelligence to avert attacks like the ones on Sept. 11, 2001.”"

I wonder what the going rate for stovepiped intelligence is.