FBI agents searched the California home of U.S. Rep. Randy "Duke" Cunningham (search) on Friday, and served warrants in Washington, D.C., at

FBI agents searched the California home of U.S. Rep. Randy "Duke" Cunningham (search) on Friday, and served warrants in Washington, D.C., at the yacht where he has been living, a Justice Department official said.

Agents also searched the offices of a defense firm whose founder bought the congressman´s previous home, leading to a federal investigation, the official said on condition of anonymity.

Cunningham, 63, has said that he showed poor judgment in selling the house, but he acted honestly and predicted that an investigation would prove that.

The former Nae paid $1.7 million for the 3,826-square-foot house in wealthy, seaside Del Mar (search), just north of San Diego. He put it back on the market soon after and eventually took a $700,000 loss when he resold it in October 2004. During that span, home prices in San Diego County rose an average of nearly 25 percent.

Meanwhile, Wade´s little-known company, Washington, D.C.-based MZM Inc., was increasing its federal contracting business. In 2004, MZM (search) tripled its revenue and nearly quadrupled its staff, according to the company´s Web site.

Cunningham has also lived part-time on Wade´s boat, docked on the Potomac River.

The congressman is a member of the House Appropriations Defense Subcommittee and the Permanent Select Committee on Intelligence, both of which oversee the kind of classified intelligence work MZM does for the military.

The Defense Department halted orders this month on a five-year contract that provided MZM with $163 million of revenue over its first three years after the department´s inspector general found that it did not satisfy rules on competitiveness.

This week, MZM announced that James King, a retired three-star Army general, was taking over as president and chief executive — a role held for years by Wade, who founded the company in 1993.
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