SAN DIEGO SAN DIEGO — Fat” Leonard Glenn Francis, the gregarious Singapore-based contractor accused of plying U.S. Navy officials with prostitutes and lavish gifts, pleaded guilty Thursday to his role at the center of a $20 million bribery scandal that has touched naval outposts around the world.
With bribes ranging from more than $500,000 in cash and hundreds of thousands of dollars in sex services to designer handbags, Spanish suckling pigs, luxury hotel suites, fine wines and ornamental swords, Francis was able to tap into the greed of “scores” of naval officers and federal employees over the past decade, according to the plea agreement.
The case has rocked the Navy at its highest levels, and prosecutors indicate it’s far from over.
“Today is the next step in this giant investigation,” said Assistant U.S. Attorney Mark Pletcher after Francis’s hearing. “The investigation continues, it’s gathering momentum.”
Francis, a Malaysian national nicknamed for his girth, pleaded guilty in a packed courtroom to charges of bribery, conspiracy to commit bribery and conspiracy to defraud the United States. His company, Glenn Defense Marine Asia, which has contracted with Navy vessels for 25 years, pleaded guilty to the same charges.
The pleas in San Diego federal court came hours after yet another high-ranking Navy official was charged in the ever-widening scheme.
Capt. Daniel Dusek, the former skipper of the Japan-based amphibious ship Bonhomme Richard, was arraigned on a conspiracy to commit bribery charge then pleaded guilty. Dusek was removed from his post in October 2013 after his connections to Francis surfaced.
Activity in the case has revved up significantly over the past two weeks. Last week saw the guilty plea of the highest-ranking official yet, Cmdr. Jose Luis Sanchez, as well as the indictment of Cmdr. Michael Misiewicz on seven additional bribery charges — leaving Misiewicz the last one still fighting the case for now.
Ken Lee, an attorney not associated with this case who specializes in military law at the Tully Rincky firm in San Diego, said the rash of plea agreements indicates cooperation with the prosecutors.
“When it comes down to it, it’s just building momentum and strengthening the government’s position here,” Lee said. “… Whoever is left standing will have a lot more pressure on them.”
A 37-page addendum in Francis’s plea agreement details the staggering scope of the scandal, noting the heavy influence his bribes had on the movements of fleets throughout Southeast Asia since at least 2004.
Francis itted cozying up to numerous Navy officers — many of them top-level decision makers, and many who were assigned to the Seventh Fleet — and showering them with bribes. In exchange, many used their positions to steer Navy ships to Southeast Asian ports controlled by Francis’s company, which provides visiting ships with such services as water, food, fuel, trash removal and security. The officers also provided the contractor with classified information, such as ship schedules, to help the company win contracts.
The plea agreement says many officers helped recruit others into the scheme. Even with the increase in business, Francis and his company sought more money from the Navy by inflating invoices and creating sham companies as subcontractors.
The fraud cost the Navy some $20 million, prosecutors said.
Francis, 50, has agreed to forfeit $35 million, and a judge could order more in restitution. He also faces up to 25 years in prison when sentenced.
“The greed of all those involved in this massive fraud and bribery case has cost American taxpayers tens of millions of dollars,” Naval Criminal Investigative Service Director Andrew Traver said in a statement Thursday. “… NCIS and our law enforcement partners have pored through mountains of documents and emails, discovering and documenting the crimes so that those who participated can be held able. Although today’s pleas are a significant milestone in the case, this investigation is far from over; there is much more work to be done.”
The plea agreement foreshadows possible charges against at least two other unnamed Navy officials: a lieutenant commander who served aboard the Seventh Fleet’s flagship Blue Ridge in 2006 and a lead contract specialist in Singapore for 20 years.
Besides the handful of defendants who have been charged, another group of Navy brass has been investigated over the past year and suspended of some duties but not yet charged. Dusek was part of that group.
From 2009 to 2011, he served as the Seventh Fleet’s deputy operations officer aboard the Blue Ridge and later served as executive officer of the Japan-based large amphibious assault ship Essex from 2011 to 2012. He was commanding officer of the Bonhomme Richard, which has a crew of more than 1,000 sailors, when the scandal derailed him.
At one point, Francis called Dusek “a golden asset to drive the big decks into our fat revenue GDMA ports,” Dusek’s plea agreement states.
In 2010 after delivering classified information, Francis’s company paid for a hotel room for Dusek and his family in Hawaii. Two months after that, Dusek was put up in a room at the Shangri-La hotel in the Philippines and provided the services of a prostitute.
Dusek was then asked to sway Navy leadership into bringing the Abraham Lincoln and its strike group to Port Klang, Malaysia, a port owned by Francis, the records state.
Dusek said in correspondence that he would persuade the powers that be, and reported “a lot of push back” but promised he “will be able to overcome and get the carrier in port.” The effort was apparently successful, as the ship visited in October 2010.
When Dusek learned of the arrests of Sanchez and Misiewicz in September 2013, he deleted the contents of all his email s to avoid detection, the plea document says.
Dusek faces a maximum of five years in prison and has agreed to pay $30,000 restitution to the Navy, due upon sentencing, which has been tentatively set for April 3 — the same day as Francis.
He remains on active desk duty at the Coronado naval base but he, and the other active-duty service who plead guilty, will probably not stay in uniform for long.
In Dusek’s case, because he has more than 20 years of service, he would likely elect to retire.
The Secretary of the Navy will have the final call on the characterization of Dusek’s discharge — whether it is honorable or not — and what rank he retires at, which determines retirement pay. The standard is at what rank did an officer last satisfactorily serve, Navy personnel officials said.
The players
Charged
- “Fat” Leonard Francis: Owner of Glenn Defense Marine Asia, itted bribing officials to secure Navy contracts in Asia. Pleaded guilty Thursday.
- Cmdr. Jose Luis Sanchez: Managed operations and logistics while stationed in Japan, itted steering business to Francis. Pleaded guilty Jan. 6.
- Cmdr. Michael Misiewicz: Managed operations on the Blue Ridge and commanded the Mustin, indicted on several bribery charges on Jan. 6.
- John Beliveau II: Supervisory special agent at Naval Criminal Investigative Services, itted sharing information about the criminal probe with Francis and accepting bribes. Pleaded guilty Dec. 17, 2013.
- Alex Wisidagama: Francis’ cousin and an executive in his company, itted his role in overbilling the Navy some $20 million for services. Pleaded guilty March 18.
- Petty Officer 1st Class Dan Layug: Worked as a logistics specialist at a base in Japan, itted ing on information to Francis. Pleaded guilty May 20.
- Edmond Aruffo: Retired Navy lieutenant commander who later went to work for Francis, itted conspiring with others to submit inflated invoices to the Navy. Pleaded guilty July 3.
- Capt. Daniel Dusek: Deputy operations director for the Seventh Fleet in Asia, itted steering business to GDMA for bribes. Pleaded guilty Thursday.
Investigated
- Rear . Bruce Loveless: Deputy chief of staff for intelligence on a Pacific carrier group staff, stationed in Japan Commanded U.S. Pacific Command’s t Intelligence Operations Center in Pearl Harbor. Investigated but not charged.
- Vice . Ted Branch: Headed Carl Vinson carrier group and served as executive assistant to the U.S. Pacific Fleet commander in Hawaii. Investigated but not charged.
- Capt. David Haas: Served on the Seventh Fleet staff, commanded the Thach and served on the Blue Ridge. Investigated but not charged.
