The US Navy is now investigating more than 60 admirals and hundreds of other Navy officers because of their possible involvement in a bribery and fraud case that has become the worst corruption scandal in the service’s history.
As the Washington Post’s Craig Whitlock reports, the admirals caught up in the so-called “Fat Leonard” scandal allegedly attended fancy meals — and post-dinner romps that sometimes included prostitutes and lots of alcohol — throughout Asia, paid for by a defense contractor named Leonard Glenn Francis. Francis is already in jail in San Diego because he pleaded guilty in January 2015 to charges of bribery and fraud; his bribes and fraudulent invoices helped him overcharge the Navy for his services by around $35 million. He’s now cooperating with authorities.
In total, 440 active-duty and retired sailors are currently under scrutiny for possibly violating ethics rules in their dealings with Francis’s company, Glenn Defense Marine Asia. So far, criminal charges have been filed against 29 people, with at least one retired rear admiral serving prison time.
Here’s what you need to know about the “Fat Leonard” scandal that is threatening some of the most senior officials in the US Navy.
“The KGB could not have done what he did"
At the core of the scandal was a tit-for-tat that allowed Francis to gain unprecedented access from top Navy officials such as admirals — the highest-ranking officials in the US Navy, equivalent to generals in the Army, Marines, or Air Force.
As the Washington Post reports, the Singapore-based Francis bribed officers of the Navy’s Seventh Fleet — the service’s largest fleet that operates in Asia — with gifts like prostitutes, money, and vacations while they docked in his ports from Russia to Australia. In exchange, Francis received classified information — including warship and submarine movements — and sensitive contracting developments.
Francis would use that privileged information to get US ships to dock in ports his company controlled. Once there, he would overcharge for “fuel, tugboats, barges, food, water, and sewage removal,” the Washington Post reported last year.
This went on for at least a decade until Francis was arrested in a sting operation on September 16, 2013, that spanned three states and seven countries in order to arrest other suspects and obtain relevant files.
Francis did have some help to do his work, though. His four associates recruited Navy officers as moles for the company and submitted fraudulent invoices, according to the Post. They have also pleaded guilty to charges ranging from fraud to conspiracy to defraud the United States.
But the Post reports that part of Francis’s success stemmed from his strategy to show leaders a good time so that they wouldn’t care how the Navy paid for dock services. He would sometimes be on the pier when the ship pulled in to offer bribes right away. Those who interacted with him said his personal touch allowed him to make friends with top Navy officials — making sure to keep them happy. That’s partially why Seventh Fleet ships kept returning to his ports, and why he was able to overcharge so much for his services.
"The Soviets couldn't have penetrated us better than Leonard Francis," an unnamed retired Navy officer who knew Francis told the Post. "He's got people skills that are off the scale. ... At one time he had infiltrated the entire leadership line.”
“The KGB could not have done what he did," the officer continued.
Robert Huie, an assistant US attorney in San Diego working the Fat Leonard case, was incredulous when he heard what Francis was able to do. "I ask, when has something like this, bribery of this magnitude, ever happened in this district or in our country's history?" he said last year during a court hearing on the case. "Mr. Francis's conduct has passed from being merely exceptional to being the stuff of history and legend."
Officials have already been charged. Will there be more?
While the investigation into the scandal is now expanding, some formerly high-ranking officers have already been charged with crimes.
So far, 14 Navy officials have pleaded guilty to charges ranging from making false statements to conspiracy to commit bribery. Retired Rear Adm. Robert Gilbeau is the highest-ranking officer to go to prison because of the scandal. In May 2017, he was sentenced to 18 months in prison, had his rank reduced to captain, and had to pay $150,000 in fines. The 13 others who pleaded guilty include three captains, five commanders, a petty officer — all junior officers — and three civilians.
Ten others are awaiting trial, including retired Rear Adm. Bruce Loveless. He was arrested in California in March and was charged with conspiracy, bribery, and making false statements, the Washington Post reports.
Adding Francis and his four associates brings the total number of charged people to 29.
It’s possible that more will face penalties as investigators look into the conduct of more admirals and officers, but it’s still unclear if they will be charged. Still, the size and scope of the Fat Leonard scandal to date is already troublesome.