Malaysian businessman pleads guilty to bribing US Navy

Leonard Glenn Francis

(Bloomberg) – A Singapore-based naval contractor at the centre of a US Navy bribery scheme pleaded guilty to charges he provided officers with cash, gifts and prostitutes in exchange for classified information about where ships were scheduled to dock.

Leonard Glenn Francis, chief executive officer of Glenn Defense Marine (Asia), is the seventh person to admit wrongdoing in the case that already led to guilty pleas of four US Navy officials and two of Francis’s employees. One commander still faces bribery charges. Glenn Defense Marine had contracts worth hundreds of millions of dollars for servicing American ships at ports in Southeast Asia.

The corruption scandal ranks among the worst for the US armed forces in 25 years. Congress passed the Procurement Integrity Act in 1988 in response to an investigation into fraud in the defence contracting industry known as “Operation Ill Wind.” By 1991, that investigation had resulted in 52 convictions, the Justice Department said at the time.

Francis pleaded guilty yesterday to conspiracy to commit bribery, bribery and conspiracy to defraud the government and faces as long as 25 years in prison.

A Malaysian citizen, Francis was arrested in September 2013 in San Diego. Known as “Fat Leonard” in Navy circles, he’s accused of paying two commanders to steer US vessels to ports that were most lucrative for his company. A Navy criminal investigator who Francis allegedly bribed for information about a probe of Glenn Defense Marine pleaded guilty in 2013.

25 years

Glenn Defense Marine worked with the US Navy for 25 years, providing goods and services for American ships in at least a dozen countries in Asia, according to court filings. Among three regional contracts the company was awarded in 2011 was one worth as much as US$125 million (RM445.7 million) over five years to provide tugboats, fuel, trash removal and other services for the Navy in Southeast Asia.

US Navy Commander Jose Luis Sanchez, 42, pleaded guilty on Jan. 6 to accepting bribes from Francis. Sanchez was deputy logistics officer for the commander of the US Navy Seventh Fleet in Yokosuka, Japan, and later director of operations for Fleet Logistics Command in Singapore.

Sanchez, who referred to Francis as “Lion King” and “Boss” in e-mails, received more than US$100,000 in cash and prostitutes that Francis arranged for him and his friends in Kuala Lumpur and Manila, prosecutors said when Sanchez was arrested in November 2013 in Tampa, Florida.

Earlier yesterday, US Navy Captain Daniel Dusek pleaded guilty to one count of conspiracy to commit bribery, becoming the highest-ranking officer to admit a role in the scheme.

US Navy Captain-Select Michael Misiewicz, 47, who was arrested in Colorado in 2013 at the same time as Francis, was indicted January 6 for bribery conspiracy and seven counts of bribery. He has a court hearing scheduled tomorrow.

The cases are US v Francis, 13-cr-03781, 13-cr-3782, 13- CR-4287, US District Court, Southern District of California (San Diego).