TPM scoops local paper on CunningScam story!
In this morning's paper, The San Diego Union-Tribune reports what TPM reported last night -- that the broker (and her family) who arranged for defense contractor Mitchell Wade to buy Rep. Cunningham's house for that inflated price has been a Cunningham campaign contributor to the tune of $11,500.
That said, the Union-Tribune story by Marcus Stern -- who broke the story on Sunday -- is excellent and nails down pretty much all the remaining loose ends which might have given any doubt what sort of 'transaction' this really was.
On the key point, was there any reason to believe that the Cunningham house had a fair market value of $1,675,000?
Stern: "A Copley News Service review of the comps for Cunningham's neighborhood during the approximate time of the sale show an array of houses of vastly different sizes and views selling for $700,000 to $1.7 million. This indicates that Todd might have set the price at the high end of the range when she set it at $1,675,000. However, the eight months it languished on the market and its subsequent sale for $975,000 during a seller's market suggest a value closer to the low end, according to real estate professionals interviewed for this article."
I'd say that passage makes Stern almost as generous as our man Mitchell Wade.
Remember, Todd set the value at $25,000 under what was apparently the highest priced home in Cunningham's entire neighborhood. And that was from a list of houses "of vastly different sizes and views." So Todd, it seems, actually went to some lengths to come in just under the laugh test mark. But even then, not really.
Another point to keep in mind, as many readers have reminded us over the last few days, is that the San Diego real estate market has been positively on fire in the last couple years. Indeed, Stern quotes another realtor saying that residential real estate properties were going up about 20% a year at the time this whole scam went down.
So even though the house eventually sold for $975,000 close to a year later, it seems likely that its fair market value at the time Cunningham sold it was well below that.
And one final point from the Stern article in the San Diego paper. As we've noted, real estate agent and Cunningham campaign contributor Elizabeth Todd put together this list of comps to justify the inflated price. As Stern notes, the "next step in a normal arms-length transaction would have been [for the purchasor, i.e., Wade] to have a Realtor or appraiser drive by the houses to see if the house being purchased was more like houses at the upper end of the range or more like houses at the lower end of the range."
But apparently Wade made no effort whatsoever to ascertain if the price he was paying for the house had any relation to its actual value. No other real estate agent, no appraiser, nothing. He went ahead on bought it -- apparently, for cash.
This story leaves little doubt that this thing was all a set-up: Mr. Wade gave Rep. Cunningham an unreported gift of upwards of a million dollars, a transaction to which Elizabeth Todd was almost certainly the knowing, shall we say, handmaiden.
Read Stern's story and see if there's any other way to interpret the facts.
Next, question: what other businesses are the Todds involved in?