A foreign defense contractor known as “Fat Leonard” pleaded guilty Thursday in an international Navy bribery scheme, admitting he gave military officials prostitutes, luxury travel and cash so he could overbill the government by more than $20 million.
Leonard Glenn Francis, 51, the CEO of the Glenn Defense Marine Asia (GDMA) in Singapore, admitted to bribery, conspiracy to commit bribery and defrauding the U.S. government in the scandal that ensnared eight people, including Navy officers, a senior NCIS investigator and Francis’ own cousin.
At his April 3 sentencing, the defendant faces a maximum of 25 years in prison and could be forced to forfeit $35 million.
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Francis changed his plea in San Diego’s U.S. District Court Thursday after a wave of defendants admitted their guilt in the scheme. According to his plea agreement, between 2004 and 2013, Francis lavished influential Navy officials with gifts to garner contracts for GDMA, which has serviced warships in Pacific ports for over 25 years.
In exchange for about $500,000 in cash, high-end hotel stays, prostitutes and extravagant gifts, Navy officers would provide Francis with confidential ship schedules for the Navy's 7th Fleet and information on competitors' pricing, performance and bids.
Using the classified information, the plea deal says Francis would convince his co-conspirators to steer ships — especially lucrative aircraft carriers — away from low revenue ports like Singapore and toward "fat revenue" ports like Phuket in Thailand.
The plea deal says Francis and co-conspirators created sham companies to pass off as bona fide port authorities to the Navy. They then inflated the costs of services and goods like fuel, tugboats and sewage disposal. In all, GDMA overbilled the Navy by more than $20 million.
Six others have pleaded guilty to various bribery and conspiracy charges. Also on Thursday, Navy Capt. Daniel Dusek admitted to one count of conspiracy of bribery after he was relieved of command on USS Bonhomme Richard.
Earlier this month, U.S. Navy Cmdr. Jose Luis Sanchez accepted a plea deal, in which he said he accepted $100,000 cash, entertainment, travel and prostitutes from Francis for proprietary Navy information.
Retired Navy Lt. Cmdr. Edmond A. Aruffo admitted to his role in the scandal in July 2014. He said he worked for GDMA and used letterhead from several Japanese vendors to send the Navy inflated invoices. When the U.S. paid those invoices, vendors would send GDMA.
Navy Petty Officer First Class Dan Layug pleaded guilty, saying he accepted a “bucket list” of electronic gadgets, as well as $10,000 in cash, from Francis and provided the defense contractor with classified information.
Alex Wisidagama, a GDMA company manager and Francis’ cousin, admitted in court to conspiracy to defraud the U.S. government.
The first to plead guilty in the investigation, senior Navy criminal investigator John Beliveau II said he used his law enforcement training to help Francis avoid detection. Francis paid him with envelopes of cash and travel to Virginia, Singapore, Thailand and the Philippines.
Another Navy commander, Michael Vannak Khem Misiewicz, has pleaded not guilty to his alleged involvement.
Read more details about what Francis pleaded guilty to by clicking here.