BY JAMES GORDON MEEK and RICHARD SISK
DAILY NEWS WASHINGTON BUREAU

WASHINGTON - FBI agents raided the office and home of top CIA official
Kyle (Dusty) Foggo yesterday in a sex and cronyism investigation
involving poker parties and a corrupt congressman.
"The first step to an arrest is a search warrant" for the raids, said
an FBI source who suggested that Foggo could face indictment for
influence peddling. "This is not looking good for Mr. Foggo," the
source said.

Foggo announced his resignation Monday as CIA executive director, the
No. 3 agency official, three days after CIA Director Porter Goss
stunned official Washington by quitting.

Goss gave no reason for resigning, but CIA spokesmen have said that
his departure was not related to the widening investigation of the
poker parties and Foggo, a 25-year CIA veteran.

FBI agents wearing latex gloves and agents from four other government
agencies conducted the raids at the CIA's tightly guarded Langley,
Va., campus and at Foggo's split-level rental home in suburban
Virginia on the authority of sealed court search warrants.

An FBI source said it's likely that agents were seeking business
records and other documents that might tie him to the ongoing
investigation of former Rep. Randall (Duke) Cunningham and San Diego
defense contractor Brent Wilkes, Foggo's high school pal.

The probe has centered on whether Foggo may have steered a $3 million
CIA contract to Wilkes.

The source noted that the FBI executed its search of Foggo's home at 8
a.m. yesterday, which suggests that agents wanted to catch him at his
CIA office when they searched that simultaneously.

A second source confirmed that Foggo was in his office when agents
from the FBI and the CIA inspector general's office arrived.

A CIA spokeswoman declined comment on the searches, but confirmed that
the raids - the first ever on the headquarters office of a high-
ranking official - took place.

The FBI investigation grew out of the conviction earlier this year of
Cunningham, a Republican who is serving an eight-year jail term on his
guilty plea to taking $2.4 million from defense contractors.

Wilkes, named as an unindicted co-conspirator in the Cunningham case,
allegedly threw regular poker parties at the Watergate and Westin
Grand hotels for lawmakers and lobbyists at which limos and
prostitutes were provided for Cunningham.

Foggo has admitted to attending Wilkes' parties, but "just for
poker."

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