SAN DIEGO -- A New York mortgage broker pleaded guilty Monday to conspiracy and making a false statement to a federal grand jury in connection with the processing of fraudulent loans for ex-congressman Randy "Duke" Cunningham's home in Rancho Santa Fe.

John Thomas Michael, 36, faces a maximum of 10 years in prison when he is sentenced on May 5 by U.S. District Judge Larry Burns.

Michael's attorney, Raymond Granger, said he was hopeful his client wouldn't serve any time in custody, but prosecutor Phillip Halpern said the government was recommending a custodial sentence.

Michael's uncle, New York financier Thomas Kontogiannis, pleaded guilty last year to money laundering for setting up $1.1 million in fraudulent loans to pay off Cunningham's mortgages.

Prosecutors have also recommended a 10-year prison sentence for Kontogiannis, who is recuperating from heart surgery.

On Monday, Michael told the judge he believed the loans were to purchase homes in Southern California for Cunningham, but later discovered his uncle was involved in illegal money laundering.

Michael said he withheld information from a federal grand jury investigating the Cunningham bribery scandal to protect his uncle.

"John has always been prepared to accept responsibility for his role in the matters being investigated by the United States Attorney's Office in San Diego," Granger told reporters outside court. "He was unaware of any efforts by anyone to bribe Mr. Cunningham.

"John thought he was preparing a legitimate loan package for the congressman," Granger said.

Michael's attorney also complimented government prosecutors for "keeping an open mind" about his client's involvement in the scandal.

Granger said Kontogiannis and Cunningham had been friends for years.

Cunningham is serving an eight-year, four-month prison sentence after pleading guilty to tax evasion and conspiracy.

Former Poway defense contractor Brent Wilkes was convicted on 13 charges of bribing Cunningham with cash, gifts and prostitutes in return for the awarding of government contracts.

Prosecutors have recommended a 60-year prison sentence for Wilkes, who is due back in court on Feb. 19.