NORTH COUNTY -- An alleged co-conspirator in the sordid bribery tale of Randy Cunningham remains an enigmatic yet key figure in what federal officials have said is the single-largest case of congressional corruption in U.S. history.

The alleged co-conspirator, New York businessman Thomas Kontogiannis, has so far escaped indictment despite being accused of having helped to steer more than $500,000 in illicit money to the former North County Republican congressman -- who now resides in an Arizona prison.

Kontogiannis' nephew, financier John T. Michael, hasn't been as fortunate as his uncle, a wealthy Long Island real estate developer who has had previous brushes with the law. Michael was indicted by a San Diego federal grand jury in February for obstruction of justice in connection with the Cunningham case.

At the same time, the government also indicted Brent Wilkes, owner of the Poway defense firm ADCS, for allegedly bribing Cunningham and for money laundering. Also indicted was Kyle "Dusty" Foggo, the former No. 3 man at the CIA, who is accused of fraud and money laundering.

Michael, Wilkes and Foggo have each pleaded not guilty.

Kontogiannis has remained silent about his alleged involvement. But in a brief telephone interview with the North County Times two years ago, he acknowledged having had dealings with Cunningham and has since been identified by multiple sources as "co-conspirator No. 3" in Cunningham court documents.

Cunningham pleaded guilty in late 2005 to taking $2.4 million in bribes in exchange for steering government contracts to Wilkes and another defense contractor, Mitchell Wade of the now-defunct Washington firm MZM Inc.

In the Wilkes indictment, prosecutors say Kontogiannis provided Cunningham with an unspecified "substantial bribe."

Efforts to reach Kontogiannis at his home and office last week were unsuccessful. His attorney, Gregory J. O'Connell, declined comment Friday.

Officials with the U.S. attorney's offices in San Diego, New York and Washington also refused to talk about Kontogiannis, who owns more than two dozen businesses, according to news reports.

Kontogiannis is a married man. He was born in Greece. Not much more is known about him.

Cooperating witness?

A former U.S. attorney in San Diego said that based upon his experience and knowledge of the indictments, a plausible explanation for why Kontogiannis has not been indicted is that he has been cooperating with prosecutors.

"It's difficult to understand why they would name him so prominently and not indict him unless he is cooperating" said Peter Nunez, who served as U.S. attorney in San Diego from 1982-88. "The most likely thing is he has already cut a deal."

A local defense attorney who practices frequently in federal court also said he believed that Kontogiannis was aiding prosecutors.

"There is a 99 percent chance that he is cooperating," said the attorney who agreed to speak on condition of anonymity because of concerns that his comments could anger prosecutors. "There is a high probability that he is cooperating and has agreed to testify if it goes to trial. He probably has appeared before the grand jury."

Alleged acts

In September 2005, agents from the FBI, Internal Revenue Service and other federal law enforcement agencies raided Kontogiannis' home and office.

What they were looking for remains under court seal, but court documents in the Wilkes and Cunningham case allege the following:

- Kontogiannis bribed Cunningham by buying a yacht from him at an above-market price, a payment made in part through a $200,000 down payment on a condominium that Cunningham bought in Arlington, Va., in 2002.

- He and Michael agreed to allow Cunningham to use Michael's company, Coastal Capital Corp., and another company to facilitate the payment of bribes.

- He and Michael used the cash proceeds from a fraudulent mortgage obtained through Coastal Capital to pay off a $500,000 mortgage on Cunningham's former Rancho Santa Fe estate. The indictment alleges that one of Wilkes' companies later repaid Kontogiannis and Michael that money with a $525,000 wire transfer.

A month before the transfer, Wilkes allegedly told Cunningham that he needed a $6 million payment from Wade on a contract that MZM had given to Wilkes' company at Cunningham's direction. The day after Wilkes received the money, he allegedly wired the $525,000.

- Kontogiannis paid more than $28,000 in mortgage payments on the Rancho Santa Fe estate Cunningham sold shortly after the allegations against him arose.

The charges in the Wilkes indictment lay out several instances of alleged money laundering and illegal transactions, and list co-conspirator No. 3 as a key player.

"Defendant Brent Roger Wilkes, co-conspirator No. 3 and others did knowingly conduct and attempt to conduct a financial transaction … knowing that the transactions involved the proceeds of a specified unlawful activity … and knowing that each transaction was designed in whole or in part to conceal and disguise the nature, location source, ownership, and control of the proceeds of said specified unlawful activities," the indictment reads.

In the 2005 Cunningham case, the first indication of a link surfaced when Kontogiannis told the North County Times that he had bought a 65-foot, flat-bottomed boat in 2002 from Cunningham for $627,000. Cunningham had bought the boat five years earlier for $200,000.

When that deal surfaced, a San Diego yacht broker said that based on the model and age of the boat, its estimated value would be no more than $200,000. There was no way it could be worth $627,00, he said, "unless it has a Picasso on board."

Untouchable?

One source with knowledge of the case said long ago that Kontogiannis may never face prosecution. That source, who also spoke on the condition of anonymity, said Kontogiannis would get a "pass" because of what he said were the man's relationships with key officials in the upper echelons of the Greek and U.S. governments.

Keith Ashdown of the Washington group Taxpayers for Common Sense has closely followed the Cunningham case. He also said he believes that Kontogiannis may be a person considered by the government as a valuable asset and therefore would not face prosecution.

"My guess: He's either an informant or an intelligence asset," Ashdown said last week during a telephone conversation. "The guy (Kontogiannis) is like Houdini -- I have never seen anything like it."

Kontogiannis and his wife, Georgia, gave more than $30,000 in political contributions to Republican congressional candidates and Republican organizations between 2000 and 2004, Federal Election Commission records show.

Kontogiannis has had two previous brushes with the law, but avoided jail time in each instance.

In 1994, he and another man were arrested by the FBI in Athens, Greece, on charges relating to bribing an embassy official to obtain a U.S. visa, according to news reports. Kontogiannis pleaded guilty to reduced charges and was sentenced to five years' probation.

In 2002, Kontogiannis pleaded guilty to charges stemming from a $2 million kickback scheme. Kontogiannis, the superintendent of a Queens County, N.Y., school district and three other co-defendants and five corporations -- three of them owned by Kontogiannis -- were charged with 123 counts of rigging bids, paying bribes and receiving kickbacks in deals related to school computers, court records show.

Kontogiannis and his co-defendants agreed to pay nearly $5 million in restitution to resolve that case. He admitted to committing fraud, providing unlawful gratuities and attempting to violate New York's antitrust law.

Pardon attempt

In a 2005 Washington Post article, Kontogiannis said he met Cunningham at a Washington function around 1990 and that the two saw each other periodically over the years.

He also said that he had served in the Greek navy before coming to the United States.

When Kontogiannis was in the thick of court proceedings over the Queens school district scandal, Cunningham wrote a letter to the Queens County District Attorney Richard A. Brown, suggesting that Kontogiannis might be the victim of a political vendetta.

"Mr. Kontogiannis is being allegedly victimized," Cunningham wrote in the letter.

But Kontogiannis' efforts to get help from Cunningham didn't stop there. Kontogiannis told reporters in 2005 that following his 2002 conviction in the kickback deal, he sought Cunningham's assistance in seeking a presidential pardon.

Cunningham apparently stopped short of contacting the White House, instead steering Kontogiannis to a Washington law firm.

The next hearing in the government's case against Wilkes takes place Monday when he is slated to appear before a federal judge to resolve issues surrounding the bond he had to put up to remain free pending trial.

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