SAN DIEGO – A Malaysian military contractor at the center of one of the Navy's worst corruption cases pleaded guilty to bribery and conspiracy charges in federal court Thursday — only hours after a second commander admitted to providing him classified information in exchange for lavish hotel rooms and prostitution services.
Leonard Glenn Francis, the chief executive of a Singapore company that has serviced Navy vessels at Asian ports for 25 years, held his hands behind his back and twiddled his fingers as he told the judge he was changing his plea to guilty.
Known in military circles as "Fat Leonard" because of his large size, Francis and his firm obtained classified information that allowed his company to overbill the U.S. military by at least $20 million, according to the plea agreement. Prosecutors say he provided lavish hotel rooms, prostitutes and plane tickets to Navy officials who cooperated.
"Today Mr. Leonard Francis has taken accountability for his actions. He looks forward to a brighter future," his attorney, Ethan M. Posner, said.
Francis faces up to 25 years in prison and is scheduled to be sentenced in April. He and his firm also must forfeit $35 million, according to the plea agreement.
In the same courthouse earlier, Capt. Daniel Dusek became the highest-ranking Navy officer to enter a guilty plea in the case after making his first appearance in federal court in San Diego and waiving his right to present his case before a federal grand jury.
A total of four Navy officers have been charged, and prosecutor Mark Pletcher said the probe is far from over.
The yearslong investigation has spanned a dozen countries and has gathered "terabyte upon terabyte of electronic data," including emails in which Francis, his managers and Navy officers discussed the arrangements. Francis was arrested in San Diego in 2013 after being lured there by military officials.
"The investigation is continuing and is gathering momentum," Pletcher said. "I can't speculate as to the people who will be charged in the future."
All the officers have been accused of providing classified information to the Singapore-based Glenn Defense Marine Asia Ltd., or GDMA, which has provided food, fuel and supplies to U.S. Navy vessels in Asia.
Three of the Navy officers have pleaded guilty and are scheduled to be sentenced. Cmdr. Michael Vannak Khem Misiewicz has pleaded not guilty to conspiracy to commit bribery. He is scheduled to be arraigned Friday on additional charges.
Prosecutors say GDMA asked captains re-route ships to ports owned by Francis or to small ports where they could impose fake port fees on the Navy.
After Dusek got a U.S. aircraft carrier re-routed to a Malaysian port owned by Francis in 2010, the defense contractor said in an email that the captain "is a golden asset to drive the big decks (aircraft carriers) into our fat revenue GDMA ports," according to the plea agreement.
Dusek told a company manager that he "wasn't worried about the security one bit," according to the plea agreement.
Dusek served as deputy director of operations for the 7th Fleet and later commanding officer of the amphibious assault ships USS Essex and USS Bonhomme Richard. He admitted to accepting the bribes between January 2009 and February 2011. He was released after agreeing to up his $250,000 Oregon home as bond. He faces up to five years in prison. He and his lawyer declined to comment outside the courtroom.
Dusek, who remains on active duty working a desk job at Coronado naval base, has agreed to pay $30,000 restitution to the Navy.
After Francis was arrested, Dusek deleted the contents of his email accounts to avoid detection by law enforcement, according to the plea agreement.
An agent with the Naval Criminal Investigative Service, John Beliveau II, who admitted to keeping Francis abreast of the investigation in exchange for hotel stays and prostitution services, pleaded guilty in the case, as have two GDMA managers.