A scandal involving the Navy’s ship supply network, until now focused on the Pacific Fleet, has spread to another contractor working for Navy ships in the waters off the Middle East, Africa and South America.
The Justice Department is looking into allegations that the company, Inchcape Shipping Services, with the help of subcontractors, overcharged the Navy by millions of dollars, interviews and previously undisclosed court documents show.
Inchcape, which is owned by the government of Dubai, was suspended this week from winning new federal contracts and is expected to meet with Justice Department officials soon to discuss the case.
The civil fraud investigation, which was prompted by a whistle-blower who had worked for the company, is another serious embarrassment for the Navy, which is already grappling with a criminal investigation of its main ship supplier in the Pacific, Glenn Defense Marine Asia.
The firm’s owner, Leonard Glenn Francis, was arrested in September on charges of conspiring to bribe Navy officials with cash, trips and prostitutes. In exchange, investigators say, those officials helped divert ships to certain ports where Glenn Defense submitted inflated bills. Three Navy officials have been charged with crimes, and four others, including two admirals, have been suspended over their ties to Mr. Francis.
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