A former Navy contractor pleaded guilty Thursday to running a decade-long bribery scheme that bilked taxpayers of tens of millions of dollars and involved payoffs to “scores” of U.S. Navy officials, who were plied with more than $500,000 in cash, prostitutes, Kobe steaks, designer handbags, ornamental swords and Cuban cigars.
The scheme that was masterminded by Leonard Glenn Francis, the owner and chief executive of Glenn Defense Marine Asia, already has led to guilty pleas by a half dozen present and former Navy officers, including the highest-ranking to date on Thursday. It has stained the service’s reputation and jarred its upper ranks.
The plea from Francis, who became known as “Fat Leonard,” raised prospects that he might now provide evidence implicating even more Navy officials in the scandal.
Francis, 50, of Singapore, pleaded guilty to conspiracy to commit bribery, bribery and conspiracy to defraud the United States before U.S. Magistrate Judge Jan Adler in San Diego. His company, GDMA, also pleaded guilty to the same charges.
As part of their plea agreements, Francis and his company agreed to forfeit $35 million and to repay the Navy whatever amount is assessed at his sentencing, set for April 3.
Also pleading guilty Thursday to a single count of conspiracy to commit bribery was U.S. Navy Capt. Daniel Dusek, 47, of San Diego, who admitted using his influence as Deputy Director of Operations for the 7th Fleet, headquartered in Yokosuka, Japan, and later as commanding officer of the USS Bonhomme Richard and executive officer of the USS Essex to benefit Francis and his company.
Leslie Caldwell, acting chief of the Justice Department’s Criminal Division, called the guilty pleas “vitally important steps” in the investigation and said that “the interests of justice and national security” demand efforts to root out all of those involved in the corruption, both inside and outside the Navy.
Francis admitted to routinely overbilling various goods and services, including fuel, tugboat services and sewage disposal, while avoiding scrutiny by buying off Navy officials with cash and millions of dollars in gifts and services. In return, he got confidential and even classified Navy information, including ship schedules, as well as preferential treatment for his company in Navy procurements, prosecutors said.
Dusek admitted to directing Naval ships to GDMA’s port terminals, including steering an aircraft carrier and its strike group to Port Klang, Malaysia, a terminal owned by Francis.
He acknowledged that Francis lavished him with meals, booze, entertainment, gifts, posh hotel stays and prostitutes.
Francis acknowledged providing hundreds of thousands of dollars in prostitution services to Navy personnel, travel expenses that included first-class airfare, stays in luxury hotels, spa treatments and lavish meals that included Kobe steaks, Spanish suckling pigs, and top-shelf alcohol and wine. Gifts included Cuban cigars, designer handbags, watches, fountain pens, designer furniture, electronics, ornamental swords and hand-made ship models.