Yacht 'Duke Stir' owned by defense contractor docked at Cunningham's slip

By: WILLIAM FINN BENNETT - Staff Writer | Thursday, June 16, 2005 1:24 PM PDT ∞

A defense contractor whose real estate dealings with Rep. Randy "Duke" Cunningham have raised ethical questions has another connection to Cunningham: He owns a boat docked at a Washington yacht club ---- a boat on which Cunningham stays while working in the Capitol.

Cunningham, R-Escondido, sits on the House Appropriations Committee, which has awarded millions of dollars to the contractor, Washington-based MZM Inc.

The relationship between Cunningham and MZM President Mitchell J. Wade came under scrutiny earlier this week when news surfaced that another company controlled by Wade purchased Cunningham's Del Mar home in 2003 and later sold it for a $700,000 loss.

Upon learning of the transaction, some experts on government ethics questioned the real estate deal and the relationship between the contractor and the congressman.

Now, another connection between Cunningham and Wade is raising questions ---- a boat owned by Wade and occupied at least part-time by Cunningham.

U.S. Coast Guard records show that Wade owns the 42-foot, 34-ton boat, which bears the name "Duke Stir."

Capital Yacht Club dock master Kelvin Lee said this week that the vessel is docked at Cunningham's slip at the marina on the Potomac River in Washington.

Lee was hesitant to give more details, but did say that until recently, a boat with the name "Kelly C" was docked at the slip. Washington Harbor Police officials said this week that Cunningham is the registered owner of the Kelly C. That boat was removed for possible refurbishment and replaced by the Duke Stir, Lee said.

MZM officials did not return phone calls Wednesday for comment on the boat or Cunningham's living arrangement.

Repeated efforts Wednesday to reach Cunningham by phone in Washington were unsuccessful. However, Cunningham's office sent a written statement from Cunningham saying his use of Wade's boat is within ethical boundaries.

"I am putting information and records together so that you will know how much I pay to stay there, and you will see that everything we've done is appropriate," read the brief statement, which was e-mailed by Cunningham's chief of staff, Harmony Allen.

An expert on ethics in government said Wednesday that the living arrangement would be unethical only if Cunningham is not paying rent.

"Then it is inappropriate because this person wants something from him and is apparently getting millions of dollars in federal contracts," said Bob Stern, president of Los Angeles-based Center for Governmental Studies, a nonpartisan think tank that studies campaign finance.

"Where there is smoke, there is fire," he said.

Questions arose earlier this week about Cunningham's relationship with the defense contractor when news broke that a company controlled by Wade had bought Cunningham's Del Mar home and sold it several months later at a $700,000 loss.

When Cunningham sold his Del Mar home to Wade's company in late 2003, the sale price was $1.675 million. Shortly after purchasing the house, the company put it back on the market. On Oct. 13, 2004, it was sold for $975,000.

An employee with Chicago Title Co. performed a computer search Wednesday for nearby similar-sized Del Mar homes that were sold between March 1, 2004, and Dec. 31, 2004. Those properties had an average sales price of $1.28 million.

Meanwhile, the comparable properties in the area that were sold at the time Cunningham sold his home to Wade's company, were on average lower in value than the $1.675 million that Wade's company paid.

Similar properties in the same area which sold between March 1, 2003, and Dec. 31, 2003, fetched an average sales price of $1.12 million, the computer search showed.

Contact staff writer William Finn Bennett at (760) 740-5426, or wbennett@nctimes.com.

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