It was at precisely 6:12 p.m. on Sept. 16, 2013, inside a luxury suite on the 21st floor of downtown’s Marriott Marquis San Diego Marina when the long and staggeringly corrupt career of Leonard Glenn Francis came to an end.
For the previous half-hour, Francis had calmly spoken with two federal investigators about his business, Glenn Defense Marine Asia, and its long-running relationship as a Navy contractor in the vast waters of the western Pacific.
A transcript and audio recording of the secretly recorded conversation, reviewed by the Union-Tribune, shows Francis breezily and sometimes jovially unspooling lie after lie about his business, GDMA. He never gave bribes to Navy officers or civilian workers, he said. Never created or approved false invoices laden with overcharges, he told the agents.
His final act as a free man was a routine one for any businessman, and one that the then-48-year-old had done countless times. He handed his business card to the two agents.
Seconds later, as Francis went to another room in the suite, other agents with guns drawn burst in and ordered him to the carpeted floor of the gleaming hotel overlooking San Diego Bay.
He was under arrest, and the worst corruption scandal in Navy history was about to go public.
What’s happened since is well known: Some 32 people, including Navy officials, civilian employees and defense contractors, were convicted or pleaded guilty to bribery and other crimes, and hundreds more faced internal Navy discipline. Francis’ girth — he was nearly 6 feet 4 inches and weighed more than 350 pounds when he was arrested but at one time weighed far more — earned him the nickname “Fat Leonard” and gave the scandal an instantly recognizable title.
Yet much of the investigation that led to that arrest nearly a decade ago has not been known — until now.
The Union-Tribune reviewed a huge trove of documents assembled by the government as part of its sprawling prosecution that provide granular details on the investigation into the far-flung, decades-long bribery and fraud scheme that beset the Navy.
Moreover, the records portray a Leonard Francis not previously seen, despite a decade of court cases and the global notoriety of the scandal he orchestrated.
The documents include internal company emails, transcripts of scores of interviews with Navy officers and GDMA employees, text messages from Francis’ cellphones, and detailed memos summarizing numerous hours-long interviews that Francis gave with investigators in the U.S. Attorney’s Office in San Diego.
They reveal a man with a personality that could be charming one minute and intimidating the next, who ceaselessly flattered Navy officers while harboring a conviction that the service he had conned was biased against him. He was a master at manipulating people and feeding their vices. And the records also show that many in the Navy were aware of his shady reputation, suspicious of his business practices, and gave him a wide berth.
But until his arrest, Navy investigators did not lay a hand on him — though they had plenty of chances. From 2004 to 2012, there were 14 separate investigations launched that stemmed from complaints about GDMA’s business practices, but most were closed. Another 10 criminal intelligence reports were produced and distributed, but nothing halted the fraud.
For years, Francis was an affable, smiling presence on piers in Asian ports, at change-of-command ceremonies and annual Navy balls. But inside GDMA he was secretive, a micromanager who personally signed off on all checks and purchase orders.
Eager to flatter Navy officers and boast about his business, Francis could be vindictive toward Navy personnel who regularly questioned the prices GDMA charged. He told investigators he was so upset that he put several Navy contracting officials who were making life hard for him under surveillance, taking photographs of them at their homes, when they went shopping or to work.
He bouthed some Navy officers who had provided him with internal information in exchange for gifts and who later asked for jobs with GDMA. Francis said he would never hire them because, ironically, they were corrupt.
His lifestyle matched his size. He lived in a 40,000-square-foot house in Singapore with a train in the backyard for his children that was bigger than the trains at Disneyland. He had a fleet of luxury cars, including two Rolls-Royces and an Austin-Healey. He would show up on piers in a fleet of new H2 Hummers and squire away favored Navy personnel to an evening of party and pleasure.
Beneath the glitz was a man who was once imprisoned in Singapore on weapons charges and sentenced to a caning, who was known by some as “the Don of the Southeast” and had a hair-trigger temper.
Always the life of the party, the records show Francis was constantly in with people. But that high-octane pace may have been covering an emptiness in his life.
“Leonard wanted — he wanted friends,” Edmond Aruffo told two agents during an interview at a Marie Callender’s in Poway, the day after Francis was arrested in 2013. Aruffo, a former Navy lieutenant commander, was a top suspect in the scheme and would later plead guilty to one count of fraud conspiracy, cooperate extensively with the government, and be a major witness at the trial of five higher-ranking officers held in San Diego last year.
“He wanted people to respect him. He wanted people to love him. He wanted people to tell him how generous he is,” Aruffo continued. “But most important, he wanted people just around.”
For all his notoriety and his central role in the case, Francis has been an enigma in the decade since his arrest. He made a few brief court appearances in the early years of the scandal. He was questioned for a military court-martial proceeding in 2016 behind closed doors. And last year he secretly recorded a multi-part podcast that was released in the fall that featured him talking expansively about the scandal.
But he never testified in open court. All that is known of how he helped build the government’s case against dozens of people is contained in the documents, though it is not the complete picture. The records reviewed by the Union-Tribune largely stop in 2017 — though Francis continued to feed information to prosecutors for several years more.
The U.S. Attorney’s Office in San Diego declined to answer questions about Francis’ statements in the many interview sessions he had in the downtown Front Street offices for most of the past decade.
“We cannot respond in detail to questions focused on a subset of the enormous amount of evidence from this investigation and concerning non-public information, including facts from discovery under a protective order preventing its distribution outside the case,” the office said in a statement.
It went on to note that prosecutors do not “simply accept at face value information provided by witnesses, particularly cooperating defendants,” which Francis was, and works to corroborate any information via other sources.
Whether Francis faces a day of reckoning for his decades of corruption is now an open question.
In September, in the strangest twist yet, Francis escaped from a cushy home-arrest arrangement in San Diego he had been living under for years after pleading guilty to bribery, conspiracy and fraud charges in 2015.
The escape came just weeks before he was scheduled to be sentenced. He’s now in Venezuela, where Interpol authorities captured him 16 days after he fled.
He has requested asylum there, while the U.S. government — which Francis had for years systematically defrauded, then eagerly helped — tries to get him back.
‘Bad stuff written all over him’
After nearly a decade, the contours of the Fat Leonard scandal and Francis’ larger-than-life presence are well known.
The elaborate dinners for Navy officers where the booze flowed freely and prostitutes were readily available, the high-end hotel rooms provided and paid for, the cash bribes — all of it was documented in court filings for the 32 people charged since 2013.
In return Francis was able to rip off the Navy for many millions of dollars through overcharging for services and port visits. In his plea agreement he agreed to pay $35 million in restitution. The records indicate the overall loss may have been much greater: One agent estimated the loss at $50 million and “leaning more towards possibly $100 million.”
GDMA, a company founded by Francis’ grandfather in 1946, provided services — from food and fuel to water, transportation and sewage removal — to Navy ships pulling into ports across Asia.
Francis ran it for more than 25 years, and for nearly all of that time, he targeted Navy officers and plied them with gifts.
In one of nearly two dozen sessions with investigators and prosecutors at the U.S. Attorney’s Office in San Diego between 2013 and 2016, he said that as far back as 1992 he was wining and dining Navy personnel — giving gifts, paying for hotel stays, and forming relationships with officers who would one day rise to the top levels of command.
The records show that Francis’ reputation for courting Navy officials with gifts was well known throughout the Navy, and in particular the massive 7th Fleet. The largest in the Navy, the fleet patrols 48 million square miles across the Pacific with 27,000 sailors and Marines and up to 70 ships and submarines and 150 aircraft.
“You know, I mean obviously he got arrested,” Navy . Tim Giardina told two federal agents who interviewed him at his home on Offutt Air Force Base in Nebraska in 2013, “but he is just a joyous, gregarious, you know, nice, nice guy — that you keep an arm’s distance from because he’s got bad stuff written all over him. … You always knew he was going to try and give you something where you felt like you owed him something.”
Giardina would later receive a reprimand from the Navy for receiving a free dinner from Francis while he was the chief of staff for the 7th Fleet and later as the deputy commander of the Pacific Fleet.
Another officer, who worked as a legal adviser in the U.S. Consulate in Hong Kong, told a Naval Criminal Investigative Service agent just hours after Francis was arrested: “What you’re basically telling me is that all the jokes about how dirty GDMA is really aren’t jokes,” according to a transcript of the interview.
Capt. Clayton Grindle, in an interview with federal agents in Hong Kong six days after the scandal became public, mused that Francis would have made “a perfect case officer” for an intelligence agency because of his talent for exploiting weak points in personalities.
“I mean, he tries to feel you out,” Grindle said, according to a transcript of the interview, “he tries to understand your weaknesses, he looks for that stuff. You know, and he starts with vices.”
Despite the reputation Francis and GDMA had, the Navy continued to do business with the company for decades, handing out tens of millions of dollars in contracts. The records are replete with “Bravo Zulu” letters — notes commending the work of GDMA and thanking Francis — from irals and other officers, complimenting Francis over the years on successful port visits and the services GDMA provided.
Francis trumpeted these commendations. The lobby of the GDMA corporate offices in Japan had a “wall of fame” with photographs of Francis as well as letters from high-ranking Navy officials.
Throughout the interviews with investigators, Francis dropped a dizzying array of names of Navy officers he had interacted with at ports around Asia.
He told investigators in an April 2015 session that he was always playing a long game as he trolled through the officer corps over the years, often eyeing officers junior in rank.
He described an October 2010 dinner at a resort in Thailand ostensibly hosted by the Royal Thai Navy but that was actually paid for by GDMA. It was a bill Francis was willing to foot because he wanted to “build relationships with USN officers to help GDMA,” according to a report of the session prepared by agents.
“Francis knew that many of the junior and senior officers would be promoted sometime in the future, and when they promoted to positions that benefited GDMA he wanted them on his side,” the agent wrote. “Francis believed they could become future Flag Officers and he needed to gain their while at a junior grade. Francis stated that this tactic always paid dividends for GDMA.”
One example: former . Robert Gilbeau, who pleaded guilty and was sentenced to 1½ years in prison in 2017 after pleading guilty to making false statements to investigators. Francis told investigators he first met Gilbeau — whom he nicknamed “Crazy Bob” — in 1997 when he was a supply officer aboard the amphibious assault ship Boxer at a port call in Bali, Indonesia.
Over the next 15 years, as Gilbeau climbed the ranks, the two remained in constant touch, according to a May 4, 2015, interview session Francis conducted with prosecutors and agents. Among his assignments was supply officer aboard the aircraft carrier USS Nimitz in 2003-04, where he was responsible for procuring all goods and services for the massive ship, and the head of tsunami relief efforts in 2004 and 2005.
Francis told agents during that lengthy session in 2015 that he provided hotel rooms, prostitutes,and gifts over the years, and, in one instance, $40,000 in cash. (Gilbeau adamantly denied taking cash and prostitutes from Francis.) Francis described one scheme in which he said Gilbeau personally signed off on hugely inflated invoices totaling $1.8 million for wastewater collection and disposal.
Gilbeau, Francis told the agents, “would sign anything.”
By 2010, Gilbeau was an iral and in command of the Defense Contract Management Agency International, an agency that is responsible for istering the Pentagon’s overseas contracts.
In that key position, Francis said he saw Gilbeau as a possible source of intelligence on the Commander, Logistics Group Western Pacific which oversees logistics for ships in the Pacific and Indian oceans.
In his guilty plea, Gilbeau itted he lied when he told agents that he had not received any gifts from Francis and later destroyed documents when Francis’ arrest became public.
Gilbeau said that Francis’ allegations about the invoices were among the lies Francis told the government. Those allegations to agents were not proved in court or addressed in Gilbeau’s plea agreement.
“Because he’s a liar, he talks a lot about stuff that isn’t true,” he told the Union-Tribune.
Gilbeau said those allegations had been “debunked,” and he had ed a lie detector test organized by his defense attorney.
“I never did anything to cheat the U.S. government,” Gilbeau added.
Fat Leonard’s domain
Over time Francis’ work for the Navy funded a massive company. He told agents he essentially had a private Navy of 100 vessels, including one that was a former U.S. Navy vessel that he repainted in GDMA corporate colors. He even had what he called an “air wing” — a helicopter with the GDMA logo, which he posed proudly in front of in an undated photograph.
By 2010, GDMA had contracts with the Navy to provide a majority of the husbanding services across the vast Pacific region of the 7th Fleet. Francis estimated his company controlled 75 percent of the ports in the region under four regional contracts valued, in total, at $121 million, according to a 2014 report from the NCIS Economic Crimes Department.
The document collection contains thousands of emails detailing the daily operations of GDMA. They show Francis cajoling Navy officials, snapping at subordinates, sometimes complaining bitterly to colleagues over how he was being treated by the Navy.
Francis had a gregarious personality but could be as secretive as he was outgoing. Sharon Kaur, a Navy contracting official who secretly funneled information to Francis and was sentenced to 33 months in Singapore, told investigators she was surprised at what Francis knew — aside from the intelligence she was giving him.
“He would never give you one ounce of information,” she said in an interview, “where his sources, who his sources, where he get (sic) the information from.”
Aruffo, who worked for GDMA as manager of business in Japan after he retired from the Navy, told investigators in an interview in 2013 that Francis “compartmentalized people so that no one person knew what another one was doing.”
Scrolling through a data dump from one of Francis’ cellphones — it runs to 2,300 pages of text messages and phone calls — shows Francis multitasking from the mundane (picking up his son from school, ordering food), to the intimate (quarreling with women) and most frequently, his business.
He could be imperious when it came to GDMA employees. The GDMA manager for Japan told agents that when Francis brought his family of three kids, wife and nanny to Tokyo to vacation at Disneyland, he insisted they be the first in line to get into the park.
The staff would have to be in line as early as 3 a.m. to hold his spot often sleeping on the sidewalk “like homeless people,” the manager said.
But despite the size and reach of his company, the records indicate that in the year before his arrest GDMA was struggling. Scrutiny of its billing practices ramped up — by then the investigation into GDMA was two years old — and the bite of reduced U.S. defense spending took hold. In 2012 a congressional budget deal slashed defense spending by billions of dollars.
Those cuts, a GDMA executive wrote in a March 2013 email to the company’s Philippines office, “has hit our business very badly.” Executives were being asked to take pay cuts of as much as 50 percent.
“Where the navy (sic) business is concerned, due to the direct impact of the reduction in naval port calls as well severe budget cuts imposed on visiting ships, our company’s earnings has dropped drastically and profitability plunging into losses,” the executive wrote.
Another pressure point on the business was the purchase by GDMA of the Port Klang Cruise Center in Malaysia in 2009, and the loans the company took out to complete it. An internal financial report from June 2012 said the company had positive cash flow, but the monthly loan repayment “dragged the cash flow into negative region.”
Alex Wisidagama, a former top executive at the company who pleaded guilty to fraud in 2014, told investigators that the loans “severely hampered” GDMA’s operations and, coupled with Francis’ expensive lifestyle, actually “increased the need for GDMA to present fraudulent claims to the U.S. Navy to keep the company going.”
In August, a month before his arrest, Francis grudgingly approved additional payments to port officials in East Timor. “We don’t have a blank check to pay pay and pay,” he wrote. “Where we can save we will.”
By then Francis was preparing for a meeting with U.S. Navy officials in San Diego. The topic was perhaps intentionally ironic: how to save money on port visits. He prepared for weeks, brought top executives along, had a strategy meeting at the high-end sushi restaurant Nobu, in the Hard Rock Hotel in the Gaslamp Quarter, the night before, the records show.
Francis spoke briefly at the start of the meeting the next morning, according to a transcript, thanking the assembled officials for the chance to discuss regional contracts. He then shifted to talking about the security that the U.S. Navy provides in the region, buttering up the of the service he had been gouging for years.
“We recognize that the relationship we maintain with the U.S. Navy runs much deeper than business, and the role that we play in ing the U.S. Navy’s forward deploy mission is one that I take very seriously,” he said. He ended by circling back to the business side.
“Our partnership with the Navy has evolved to its strongest state using this contracts, and today we back up these statements,” he said.
Just a few hours later, that partnership with the Navy ended at gunpoint on the floor of a hotel suite upstairs from the conference room.
Bill comes due
Even as Francis sat in custody of the FBI in those first few hours, the business of the company he built kept churning.
Among the work done that day: a message sent to the cargo ship Charles Drew, at the Navy base in Sasebo, Japan.
It was, appropriately, an invoice. GDMA was billing the U.S. Navy $42,283, for services performed under the ship-servicing contract.
It took a while for news of Francis’ arrest at the downtown hotel to reach halfway around the world into the offices of GDMA. The voluminous records capture in fragmented detail the mounting alarm among his family and employees over the course of the next day.
A series of text messages buzzed through to Francis’ phone, now in possession of federal authorities, on Sept. 17, 2013. A banker from DBS Bank in Singapore texted “I really need your help on the repayment of USD350k urgently.”
A few minutes later, the phone buzzed again. “Sir,” wrote an apparent GDMA employee, “there are 3 officers with the credential to prove they are from ib.” That’s the Corrupt Practice Investigation Bureau of the Singapore police.
“They have a search warrant to search the premises.”
A few minutes later the banker texted again. “Hi Mr. Leonard. Tried calling u but can’t reach u. Can you call me pl?”
And then two hours later, after the cellphone records show dozens of unanswered calls, his sister texted: “Can you call our mother she says government people raided the house took your computer snd (sic) also went to your office.”
The net had closed around Leonard Francis. He would find a way out by escaping nearly nine years later to the day, just weeks before he was to be sentenced — foiling the government that he had so ably plundered for decades.
Former staff writer Andrew Dyer contributed to this report.
