SAN DIEGO -- A Poway defense contractor and the former No. 3 man at the CIA pleaded not guilty Wednesday to conspiracy and other charges stemming from a corruption scandal that sent ex-U.S. Rep. Randy "Duke" Cunningham to prison last year.

A San Diego federal grand jury Tuesday indicted Brent Wilkes, 52, on charges that he provided more than $700,000 to Cunningham, who in return betrayed the public trust by corruptly influencing the appropriations of funds and the execution of government contracts that would help Wilkes' company, ADCS Inc.

Read Wilkes' Statement

Kyle "Dusty" Foggo, also 52, was charged in a second indictment with conspiring to defraud the United States and its citizens of the right to honest services.

Among other things, the indictment alleges that Foggo, who resigned his CIA post last May, used his seniority and influence within the agency to influence the awarding of contracts to Wilkes, a lifelong friend.

Wilkes and Foggo played football together at Hilltop High School in Chula Vista.

The indictment also charges New York-based mortgage banker John T. Michael, 35, with obstructing justice by attempting to influence and impede a federal grand jury investigation by, among other things, providing false and misleading testimony regarding Wilkes' role in paying off the $500,000 second mortgage on Cunningham's Rancho Santa Fe home.

Michael also pleaded not guilty Wednesday in a hearing before U.S. District Judge Larry Burns.

The judge allowed all three defendants to remain free on bond pending an April 2 discovery hearing to make sure federal prosecutors have given defense attorneys all the information they need to prepare for trial.

Wilkes' attorney, Mark Geragos, made a brief statement to reporters as he left the downtown federal courthouse with his client.

"Obviously, we're not happy that Brent has been indicted," Geragos said. "And after 18 months of what has been -- for lack of a better term -- an unrelenting campaign of leaks and false information put out there and innuendo (and) accusations that I think are completely unfounded, we welcome the opportunity now to be here in a courtroom where we can actually address these things, and that's what we plan to do."

Wilkes was allowed to remain free as long as he posts a $2 million bond secured by property within two weeks; Foggo was ordered to post a $200,000 bond; and Michael must post a $250,000 bond, the judge said.

Burns also told the defendants they couldn't possess any firearms and could not travel abroad, and warned Foggo not to divulge any state secrets.

Geragos told the judge that one of the indictments against Wilkes seemed fairly simple and one seemed more complex. The attorney told Burns he was contemplating putting the case on a fast track to trial.

"Factually, we don't believe the case is particularly complex," said Assistant U.S. Attorney Phillip Halpern.

The prosecutor conceded, however, that the indictment naming Wilkes and Michael is factually more complicated than the indictment charging Wilkes and Foggo.

One issue to be resolved is whether classified information will be sought and used in the trial, attorneys said.

According to the indictment, Wilkes paid the bribes to Cunningham in the form of cash, checks, meals, prostitution and limousine services, corporate jet travel, lodging, furnishings, boats and marine equipment, vacations and entertainment.

In return for receiving the bribes, Cunningham used his public office for nearly a decade to influence the awarding of more than $100 million in defense contracts to Wilkes, according to the indictment.

Wilkes is charged with 25 counts, including conspiracy to commit bribery, honest services wire fraud, and money laundering; bribery of a public official; and unlawful monetary transactions.

The second indictment alleges that in order to conceal Foggo's conflict of interest and corrupt intent, Wilkes and Foggo carried out their scheme by using shell companies and straw men to conceal Wilkes' role and interest, and to launder the proceeds of their fraud.

Halpern said prosecutors will seek the forfeiture of $12 million in illegally gained profits.

According to the indictment, Foggo misrepresented and concealed material facts from CIA officials, including his knowledge of, and role in, attempting to steer contracts to Wilkes, and his receipt of numerous benefits from Wilkes, including tens of thousands of dollars in various meals, gifts and vacations, and a standing offer of a senior executive position with Wilkes' ADCS Inc.

The indictment alleges that Foggo not only used his position to influence the awarding of CIA contracts, but also used his position to assist Wilkes in obtaining money from other CIA contractors.

In August 2003, Wilkes allegedly paid for Foggo and his family to join Wilkes and his family for a vacation in Scotland, according to the indictment.

The vacation included more than $12,000 in private jet flights, more than $4,000 for a helicopter ride for a round of golf in Carnoustie, and more than $44,000 for a stay at the Pitcastle Estate, which included trout fishing on hill lochs, salmon fishing on the River Tay, clay pigeon shooting, archery and a seven-person staff, according to the indictment.

At a party at Wilkes' Poway office in December 2003, Wilkes introduced Foggo to a group of employees as a future executive in Wilkes' companies, according to the indictment.

If convicted, Wilkes and Foggo face hundreds of months in federal prison, Halpern said.

When he was sentenced last March to more than eight years in federal prison, a tearful Cunningham apologized for his actions before receiving what prosecutor Jason Forge described as the longest term ever handed down in a public corruption case involving a former member of Congress.

The Republican, who represented North County's 50th District for eight terms and was a decorated Navy fighter pilot in Vietnam, pleaded guilty in November 2005 to conspiracy to commit bribery and evading more than $1 million in taxes. He resigned from office the same day.

A federal investigation into Cunningham's dealings with contractors began in June 2005, after the San Diego Union-Tribune published a story about the sale of his Del Mar home for $1.675 million.

The buyer was defense contractor Mitchell Wade, who sold the home less than a year later at a $700,000 loss.

Cunningham, who sat on a defense appropriations subcommittee, used the proceeds from the Del Mar sale to buy a home in Rancho Santa Fe for $2.55 million.

According to his plea agreement, Cunningham received checks of more than $1 million, cash, Persian rugs, antiques, yacht club fees, boat repairs, moving expenses and free vacations.

He was able to live for free on a yacht called the "Duke-Stir," used a Rolls-Royce automobile and had the expenses paid on a lavish graduation party for one of his daughters, court papers state.

Wade, founder of MZM Inc., pleaded guilty last year to conspiring to funnel more than $1 million in bribes to Cunningham and making illegal campaign contributions to two other members of Congress.