Malaysian contractor US Navy guilty of conspiracy

A Malaysian ship-supply contractor and a fourth Navy official pleaded guilty to federal charges on Thursday, in a decade-long conspiracy that the contractor said involved scores of Navy officials and millions of dollars in bribes and gifts. http://www.nytimes.com/2015/01/16/us/fourth-navy-official-pleads-guilty-in-bribery-scandal.html?partner=socialflow&smid=tw-nytimes&_r=0
Leonard Glenn Francis, a contractor known as “Fat Leonard,” pleaded guilty in federal court in San Diego to bribery, conspiracy to commit bribery and conspiracy to defraud the United States, and agreed to forfeit $35 million in ill-gotten gains.
Mr. Francis’s plea came shortly after Capt. Daniel Dusek, the former commander of an amphibious assault ship, became the fourth Navy official, as well as the highest ranking, to admit to accepting prostitutes’ services, trips and other gifts for aiding Mr. Francis’s scheme to overbill the Navy for ship supplies and dockside services.
“With Leonard Francis as a cooperating witness, the prosecutors may be able to go after Navy officers as high or even higher than they have gone after so far,” said Charles Tiefer, a former member of the federal Commission on Wartime Contracting in Iraq and Afghanistan and a professor at the University of Baltimore School of Law.
Court records released Thursday said that Mr. Francis’s gifts to Navy officials included more than $500,000 in cash, hundreds of thousands of dollars in the services of prostitutes, and hundreds of thousands of dollars in travel expenses. He also provided the Navy officials with gifts like Cuban cigars, Spanish suckling pigs and ornamental swords.
Not all of the officials who received gifts are likely to be charged, especially if they did not do anything to aid Mr. Francis’s overbilling scheme. But the court records indicated that Mr. Francis had already given prosecutors the names of seven
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Navy officials to whom he said he paid bribes in exchange for help. They include Captain Dusek and the three others who have pleaded guilty, and a fifth official, Cmdr. Michael Vannak Khem Misiewicz, who is fighting charges in the case. The other two identified by Mr. Francis were described in his plea agreement as a Navy contract specialist and a lieutenant commander. Neither of them was named, and neither has been charged.
Mr. Francis faces as many as 25 years in prison and must pay full restitution to the Navy, an amount that could exceed $35 million. “Today Mr. Leonard Francis has taken accountability for his actions,” said Ethan M. Posner, one of his lawyers.
Like other Navy officials already charged in the case, Captain Dusek helped steer warships to ports where Mr. Francis’s company, Glenn Defense Marine Asia, could gouge the Navy for supplies and dockside services, prosecutors said. According to the charges filed against Captain Dusek on Thursday, Mr. Francis once emailed an associate that Captain Dusek was “a golden asset” in routing aircraft carriers to “our fat revenue” ports. The document said Mr. Francis’s company had supplied Captain Dusek with hotel rooms and prostitutes in the Philippines and Hong Kong.
Mr. Francis was arrested in September 2013 and was charged with inflating hundreds of billings. At 6 feet 3 inches and 350 pounds, he was known within the Navy for hosting dinners at luxury hotels across Southeast Asia for senior Navy officers. But even though emails obtained by criminal investigators show that several ship crews and contracting officials had complained about his “gold-plated” fees from 2009 to early 2011, the Navy still awarded his company $200 million in contracts in June 2011, giving him control over servicing warships at many ports in the Pacific.
Two of Mr. Francis’s employees, including one who is a retired Navy lieutenant commander, have also pleaded guilty to conspiracy charges.
The Navy has also stripped two admirals of their access to classified information amid accusations of inappropriate contact with Mr. Francis. Neither has been charged.
In 2013, the Navy also suspended another ship-supply company, Inchcape, that has been under civil-fraud investigation by the Justice Department for possible overbillings. And late that year, a third Navy ship supplier, Multinational Logistic Services, placed one of its senior executives on leave over questions about how he had handled Navy billings while at Inchcape.

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