Ex-CIA official indicted over agency contracts

LOS ANGELES (Reuters) - The CIA's former No. 3 official and a defense contractor were indicted on Tuesday on charges stemming from a federal contracts investigation that landed former Republican congressman Randy Cunningham in jail.

Kyle "Dusty" Foggo, who had been appointed executive director of the agency in 2004 by former CIA Director Porter Goss, was charged with improper conduct involving CIA contracts following a wide-ranging investigation that involved five agencies, including the FBI and the CIA's inspector general.

The indictment was handed up on Tuesday by a federal grand jury in San Diego.

Foggo, who spent 25 years with the CIA, last year denied any wrongdoing and said all contracts he oversaw were properly handled.

Defense contractor Brent Wilkes was indicted on conspiracy charges and accused of giving Cunningham more than $700,000 to help steer government contracts to his San Diego-based company, ADCS, Inc.

"At every step of the process, CIA -- through the offices of inspector general and general counsel -- has cooperated closely with other investigative agencies and the Department of Justice," CIA Director Air Force Gen. Michael Hayden said in announcing the Foggo indictment to agency employees.

Before Foggo resigned from his position last May, the CIA acknowledged that its inspector general was investigating whether Foggo helped steer any agency contracts to his long-time friend Brent Wilkes, a San Diego businessman.

Before becoming executive director, Foggo worked for the CIA as a logistics expert in Frankfurt, Germany, where he helped arrange overseas trips for members of Congress.

Wilkes was said to have hosted poker games at the Watergate and other upscale Washington hotels, including one 1999 party attended by Foggo, Cunningham and a former CIA official nicknamed "Nine Fingers."

A New York-based mortgage banker, John Michael, also was named in the indictment and charged with obstructing justice by lying to a grand jury investigating the case.

Cunningham, of California, was sentenced to eight years and four months in prison in March after pleading guilty in 2005 to accepting $2.4 million in bribes.