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October 18, 2016 By AMK

Just when you think ‘Fat Leonard’ can’t get worse, an NCIS agent is sentenced to 12 years for bribery

The massive contract fraud and corruption scandal linked to Leonard Glenn Francis, the former CEO of Glenn Defense Marine Asia (GDMA), a defense contracting firm based in Singapore, just landed a Naval Criminal Investigative Service (NCIS) supervisory special agent in prison for for 144 months.

ncisJohn Bertrand Beliveau II was sentenced on Friday, Oct. 14, 2016 for disclosing sensitive law enforcement reports to Leonard Francis, a target of a criminal fraud investigation into favors he made in exchange for cash, luxury travel and the services of prostitutes.  Francis’ reputation for corruption and bribery in recent years has led him to be nicknamed “Fat Leonard.”  (For background, see The Washington Post article, “The Man Who Seduced the 7th Fleet,” here.)

According to admissions made as part of his plea agreement, Beliveau helped former GDMA CEO “Fat Leonard” Francis perpetrate a massive fraud scheme on the U.S. Navy by providing information that allowed Francis to avoid, stall and thwart criminal investigations into misconduct by GDMA.  As part of the sentence handed down by U.S. District Judge Janis L. Sammartino, Beliveau was also ordered to pay $20 million in restitution to the Navy.

According to his plea agreement, Beliveau acknowledged that he regularly searched confidential NCIS databases for reports of investigations related to Francis and GDMA.  Over the course of years, he helped Francis avoid multiple criminal investigations by providing copies of these reports.  These reports not only tipped off Francis that he was the target of a criminal investigation, but provided sensitive law enforcement information about the ongoing investigation, including:

  • the identities of the subjects of the investigations,
  • information about witnesses, including identifying information about cooperating witnesses and their testimony,
  • the particular aspects of GDMA’s billings that were of concern to the investigations,
  • the fact that the investigations had obtained numerous email accounts and the identities of those accounts,
  • the reports to prosecutors and their interactions with the investigations, and
  • planned future investigative activities.

Beliveau admitted that he attempted to cover up his involvement by asking Francis to delete incriminating emails and deactivate an email account, and warned Francis about indictments and a warrant on his email account.  Beliveau also admitted that he counseled Francis on how to perpetuate his fraud scheme and evade detection.  In July 2011, Beliveau advised Francis to respond to the pending NCIS investigation into GDMA’s submission of a fraudulent claim to the U.S. Navy for dockage and wharfage fees for certain U.S. Navy ship visits to Thailand.

In return for providing him with information, Francis provided Beliveau with envelopes containing cash, luxury travel from Virginia to Singapore, the Philippines and Thailand.  On many occasions, beginning in 2008 and continuing through 2012, while Beliveau was posted in Singapore, Francis provided him with prostitutes, lavish dinners, entertainment and alcohol at high-end nightclubs.  The tab for each of these outings routinely ran into the thousands of dollars.

So far, a total of 16 individuals have been charged in connection with the GDMA corruption and fraud investigation.  Including Beliveau, 11 of those are current or former U.S. Navy officials, including Admiral Robert Gilbeau, Captain (ret.) Michael Brooks, Lt. Commander Gentry Debord, Commander Bobby Pitts, Captain Daniel Dusek, Commander Michael Misiewicz, Lt. Commander Todd Malaki, Commander Jose Luis Sanchez, Petty Officer First Class Daniel Layug and Paul Simpkins, a former DoD civilian employee who oversaw contracting in Singapore.  Details include:

  • Gilbeau, Debord, Dusek, Misiewicz, Malaki, Beliveau, Sanchez, Layug and Simpkins have pleaded guilty.
  • On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine.
  • On Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine.
  • On March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine.
  • On April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to pay $95,000 in restitution to the Navy.
  • Gilbeau, Sanchez and Simpkins also await sentencing.
  • Brooks and Pitts were charged in May 2016 and their cases are pending.

Also charged are five GDMA executives: Francis, Alex Wisidagama, Ed Aruffo, Neil Peterson and Linda Raja.

  • Wisidagama has pleaded guilty and was sentenced on March 18, 2016, to 63 months in prison and $34.8 million in restitution to the Navy.
  • Francis and Aruffo have pleaded guilty and await sentencing.
  • Peterson’s and Raja’s cases are pending.

NCIS-DCIS-DCAAThe Defense Criminal Investigative Service (DCIS), the Defense Contract Audit Agency (DCAA) and the NCIS are continuing their investigation.

Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DoD hotline at www.dodig.mil/hotline, or call (800) 424-9098.

Source: https://www.justice.gov/opa/pr/former-ncis-supervisory-special-agent-sentenced-12-years-prison-taking-bribes-defense

Filed Under: Government Contracting News Tagged With: abuse, acquisition workforce, bid rigging, bribery, conspiracy, corruption, DCAA, DCIS, DoD, DOJ, ethics, Fat Leonard, fraud, GDMA, graft, greed, investigation, Justice Dept., kickback, Navy, NCIS, waste

October 17, 2016 By AMK

Latest ‘Fat Leonard’ conspirator pleads guilty in Navy’s ongoing bribery and fraud investigation

A U.S. Navy lieutenant commander is the latest military official to plead guilty to a bribery charge in federal court and admitted to accepting cash, luxury hotels and prostitutes from a foreign defense contractor in exchange for proprietary Navy information.

Navy logoGentry Debord, who is based in Singapore, pleaded guilty on Oct. 13, 2016.  He is scheduled to be sentenced on Jan. 13, 2017.  In pleading guilty, Debord, who served in several logistical and supply positions in the Western Pacific, admitted that he instructed Glenn Defense Marina Asia (GDMA) executives to inflate their invoices to the Navy to cover the cost of various illicit gifts provided to him.  From November 2007 to January 2013, Debord provided former GDMA CEO Leonard Glenn Francis and others with internal and proprietary U.S. Navy information.

Francis’ reputation for corruption and bribery in recent years has led him to be nicknamed “Fat Leonard.”  (See The Washington Post article, “The Man Who Seduced the 7th Fleet,” here.)

This information provided by Debord included inside information about competitors’ bids on Navy contracts and information about an investigation into GDMA’s billing practices.  Debord also admitted to misusing his position and influence in the Navy to advocate for and advance GDMA’s interests, including by approving inflated invoices for services never rendered that he directed Francis to submit.

According to admissions made in connection with his plea, as part of this conspiracy, Debord, Francis and others attempted to conceal the bribes given to Debord as well as the nature and extent of his relationship with Francis.  This was done by, for example, using coded language in communications referring to prostitutes as “cheesecake” or “bodyguards.”  Debord also requested that GDMA executives provide him with an apartment for a port visit.

In addition, Debord admitted to asking a GDMA executive to provide him with three hotel rooms, two cell phones, a van and 2,000 Singapore dollars.  Debord instructed the executive to recover the value of these items by inflating the amount that GDMA would invoice the U.S. Navy for potable water and trash removal service for the U.S.S. Essex port visit to Singapore, which GDMA proceeded to do.

So far, a total of 16 individuals have been charged in connection with the GDMA corruption and fraud investigation.  Of those, 11 are current or former U.S. Navy officials, including Debord, Admiral Robert Gilbeau, Captain (ret.) Michael Brooks, Commander Bobby Pitts, Captain Daniel Dusek, Commander Michael Misiewicz, Lt. Commander Todd Malaki, Commander Jose Luis Sanchez, Petty Officer First Class Daniel Layug, Naval Criminal Investigative Service Supervisory Special Agent John Beliveau and Paul Simpkins, a former DoD civilian employee who oversaw contracting in Singapore.

Gilbeau, Dusek, Misiewicz, Malaki, Beliveau, Sanchez, Layug and Simpkins have pleaded guilty.

  • On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine.
  • On Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine.
  • On March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine.
  • On April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to pay $95,000 in restitution to the Navy.
  • Beliveau, a a onetime NCIS agent of the year, was scheduled to be sentenced at the end of last week.
  • Gilbeau, Sanchez and Simpkins also await sentencing.
  • Brooks and Pitts were charged in May 2016 and their cases are pending.

Also charged are five GDMA executives: Francis, Alex Wisidagama, Ed Aruffo, Neil Peterson and Linda Raja.

  • Wisidagama has pleaded guilty and was sentenced on March 18, 2016, to 63 months in prison and $34.8 million in restitution to the Navy.
  • Francis and Aruffo have pleaded guilty and await sentencing.
  • Peterson’s and Raja’s cases are pending.  An indictment is merely an allegation and all defendants are presumed innocent unless and until they are found guilty beyond a reasonable doubt in a court of law.

NCIS-DCIS-DCAAThe Defense Criminal Investigative Service (DCIS), the Naval Criminal Investigative Service (NCIS0, and the Defense Contract Audit Agency (DCAA) are investigating this ongoing case.    Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DoD Hotline at www.dodig.mil/hotline, or call (800) 424-9098.

Source: https://www.justice.gov/opa/pr/us-navy-lieutenant-commander-pleads-guilty-expanding-bribery-and-fraud-investigation

Filed Under: Government Contracting News Tagged With: abuse, acquisition workforce, bid rigging, bribery, conspiracy, corruption, DCAA, DCIS, DoD, DOJ, ethics, Fat Leonard, fraud, GDMA, graft, greed, investigation, Justice Dept., kickback, Navy, NCIS, waste

September 22, 2016 By AMK

More ‘Fat Leonard’ fallout seen in indictments of former executives of foreign defense contractor

Two former executives of a foreign defense contractor have been charged with participating in a conspiracy to submit fraudulent information, price quotes, claims and invoices to the U.S. Navy in an effort to steal millions of dollars as part of a years-long corruption and fraud scheme.

Navy logoAll of the charges relate to the defendants’ interactions with Leonard Glenn Francis, the former CEO of Glenn Defense Marine Asia (GDMA), a defense contracting firm based in Singapore.  Francis’ reputation for corruption and bribery in recent years has led him to be nicknamed “Fat Leonard.”  (See The Washington Post article, “The Man Who Seduced the 7th Fleet,” here.)

Neil Peterson, 38, and Linda Raja, 43, both of Singapore, were each charged with one count of conspiracy to defraud the United States with respect to claims; one count of conspiracy to commit wire fraud; and multiple counts of making false claims.  Both defendants have been arrested by authorities in Singapore at the request of the U.S. government.

According to the indictment, Peterson and Raja worked for Singapore-based GDMA and conspired with Leonard Glenn Francis in order to defraud the U.S. Navy for GDMA’s financial benefit.  The indictment alleges that Peterson served as the Vice President for Global Operations for GDMA and Raja served as GDMA’s General Manager for Singapore, Australia and the Pacific Isles.

The indictment alleges that Peterson and Raja submitted more than $5 million in false claims and invoices to the U.S. Navy.  In addition, Peterson and Raja allegedly worked to perpetuate and cover up their fraud by consistently misrepresenting to the U.S. Navy the cost of providing services to its ships in Asia, even going so far as to submit false price quotes from non-existent companies on letterhead created from graphics cut and pasted from the internet.

Including Peterson and Raja, a total of 16 individuals have been charged to date in connection with the GDMA corruption and fraud investigation.  Of those, 11 are current or former U.S. Navy officials, including Admiral Robert Gilbeau; Captain (ret.) Michael Brooks; Commander Bobby Pitts; Lt. Commander Gentry Debord; Captain Daniel Dusek; Commander Michael Misiewicz; Lt. Commander Todd Malaki; Commander Jose Luis Sanchez; Petty Officer First Class Daniel Layug; NCIS Supervisory Special Agent John Beliveau; and Paul Simpkins, a former DoD civilian employee who oversaw contracting in Singapore.

Gilbeau, Dusek, Misiewicz, Malaki, Beliveau, Sanchez, Layug and Simpkins have pleaded guilty.  On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine; on Jan. 29, 2016, Malaki was sentenced to 40 months in prison and ordered to pay $15,000 in restitution to the Navy and a $15,000 fine; on March 25, 2016, Dusek was sentenced to 46 months in prison and ordered to pay $30,000 in restitution to the Navy and a $70,000 fine; and on April 29, 2016, Misiewicz was sentenced to 78 months in prison and ordered to pay $95,000 in restitution to the Navy and a $100,000 fine.  Gilbeau, Beliveau, Sanchez and Simpkins await sentencing.

Brooks, Pitts and Debord were charged in May 2016 and their cases are pending.

Also charged are three additional GDMA executives: Francis, Alex Wisidagama and Ed Aruffo, and all three have pleaded guilty.  Wisidagama was sentenced on March 18, 2016, to 63 months in prison and was ordered to pay $34.8 million in restitution to the Navy.  Francis and Aruffo await sentencing.

NCIS-DCIS-DCAAAn indictment is merely an allegation and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

DCIS, NCIS and the Defense Contract Audit Agency are investigating.  The Justice Department’s Fraud Section of the Criminal Division and U.S. Attorneys from the Southern District of California are prosecuting the case.  The Justice Department’s Office of International Affairs provided assistance.

Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD hotline at www.dodig.mil/hotline, or call (800) 424-9098.

Source: https://www.justice.gov/opa/pr/two-former-executives-foreign-defense-contractor-charged-expanding-fraud-and-corruption-probe

Filed Under: Government Contracting News Tagged With: abuse, acquisition workforce, bid rigging, bribery, conspiracy, corruption, DCAA, DCIS, DoD, DOJ, ethics, Fat Leonard, fraud, GDMA, graft, greed, investigation, Justice Dept., kickback, Navy, NCIS, waste

June 27, 2016 By AMK

‘Fat Leonard’ case takes down former DoD supervisory contracting officer

A former Department of Defense (DoD) supervisory contracting officer pleaded guilty last week to charges that he accepted bribes from the owner of the foreign defense contractor at the center of a massive bribery and fraud scandal.

Navy logoPaul Simpkins, 61, of Haymarket, Virginia, was a senior DoD contracting official who supervised contracting officers responsible for awarding and administering U.S. Navy contracts.  Sentencing is set for Sept. 9, 2016.

According to admissions made in connection with his plea, from approximately May 2006 until September 2012, Leonard Glenn Francis a/k/a “Fat Leonard,” owner of Singapore-based Glenn Defense Marine Asia (GDMA), provided cash, travel expenses and the services of prostitutes in return for Simpkins’s efforts to steer contracts to GDMA and intervene on GDMA’s behalf in contracting disputes with the U.S. Navy.  Simpkins admitted that during the years-long scheme, Francis provided him with hundreds of thousands of dollars through wire transfers to a bank account in Japan controlled by Simpkins’s former wife.  After Francis transferred the funds to Simpkins’s wife’s account, Simpkins caused payments to be remitted to a U.S. bank account held in his own name.

According to his plea, Simpkins admitted that, in return, he:

  • Used his influence within the U.S. Navy to benefit GDMA, specifically that he extended GDMA’s contract after a subordinate recommended the contract not be extended due to high costs.
  • Instructed U.S. Navy officials in Hong Kong to discontinue using meters that ensured proper accounting of the amount of waste that GDMA removed from U.S. Navy ships to ensure that no overbilling occurred.
  • Instructed a U.S. Navy official to ignore invoices that GDMA submitted after Francis complained that U.S. Navy personnel were asking questions.

Including Simpkins, 14 individuals have been charged in connection with this scheme; of those, 11 have pleaded guilty, including Rear Admiral Robert Gilbeau, Captain (Select) Michael Misiewicz, Captain Daniel Dusek, Lieutenant Commander Todd Malaki, NCIS Special Agent John Beliveau, Commander Jose Luis Sanchez and Petty Officer First Class Dan Layug.

  • On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine.
  • On Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine.
  • On March 18, 2016, Alex Wisidagama, a former GDMA employee, was sentenced to 63 months in prison and to pay $34.8 million in restitution to the Navy.
  • On March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine.
  • On April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to forfeit $95,000 in proceeds for the scheme.
  • Francis and Ed Aruffo, a former GDMA employee, as well as GDMA, the corporate entity, have pleaded guilty and await sentencing.
  • Retired Captain Michael Brooks, Commander Bobby Pitts and Lieutenant Commander Gentry Debord were charged by a federal grand jury on May 25, 2016, and their cases remain pending.

NCIS-DCIS-DCAAThe ongoing investigation is being conducted by NCIS, DCIS and DCAA.

Those with information relating to fraud, corruption or waste in government contracting should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD Hotline at www.dodig.mil/hotline, or call (800) 424-9098.

Source: https://www.justice.gov/opa/pr/former-supervisory-contracting-officer-pleads-guilty-accepting-bribes-foreign-defense

Leonard Glenn Francis’ reputation for corruption and bribery in recent years has led him to be nicknamed “Fat Leonard.”  (See The Washington Post article, “The Man Who Seduced the 7th Fleet,” here.)

 

Filed Under: Government Contracting News Tagged With: abuse, acquisition workforce, bribery, conspiracy, corruption, DCAA, DCIS, DOJ, Fat Leonard, fraud, GDMA, graft, greed, Justice Dept., kickback, Navy, NCIS, waste

March 28, 2016 By AMK

Navy captain sentenced to 46 months in prison for accepting contractor bribes

The highest-ranking official charged so far in a massive Navy bribery scandal was sentenced in federal court on March 25, 2016 to 46 months in prison for giving classified information to a foreign defense contractor in exchange for prostitutes, luxury travel and other gifts.

GDMA 03.2016U.S. Navy Capt. Daniel Dusek was sentenced by U.S. District Judge Janis L. Sammartino of the Southern District of California, who also ordered Dusek to pay a $70,000 fine and $30,000 in restitution to the Navy.  He was ordered to report to the U.S. Bureau of Prisons on June 15, 2016.

Dusek, 49, pleaded guilty in January 2015 to a single count of conspiracy to commit bribery.  Dusek admitted that he used his influence as Deputy Director of Operations for the Seventh Fleet, headquartered in Yokosuka, Japan, and later as executive officer of the USS Essex and the commanding officer of the USS Bonhomme Richard, to benefit Leonard Glenn Francis and his company, Glenn Defense Marine Asia (GDMA).  For decades, GDMA provided port services to U.S. Navy ships and in return, Francis plied Dusek with meals, alcohol, entertainment, gifts, dozens of nights and incidentals at luxury hotels and the services of prostitutes, Dusek admitted.

Underscoring his importance to the conspiracy, in an email to one of his employees, Francis wrote: “(Dusek) is a golden asset to drive the big decks (aircraft carriers) into our fat revenue GDMA ports.”

Justice Dept. seal“As a Navy officer, Captain Dusek took an oath to bear true faith and allegiance to the United States,” said Assistant Attorney General Leslie R. Caldwell.  “Instead, he chose self-interest, greed and prurience.  And when he learned of the investigation, Captain Dusek deleted his email accounts in an attempt to shield his crimes from law enforcement.  The Department of Justice is committed to holding public officials responsible when they betray the public trust.”

“Captain Dusek’s betrayal is the most distressing because the Navy placed so much trust, power and authority in his hands,” said U.S. Attorney Laura E. Duffy.   “This is a fitting sentence for a man who was so valuable that his conspirators labeled him their ‘Golden Asset.’”

DCIS“This outcome again sends the message that corruption will be vigorously investigated and prosecuted,” said James B. Burch, Director of the Department of Defense’s Defense Criminal Investigative Service (DCIS).  “This is an unfortunate example of dishonorable naval officers who recklessly risked the safety of our troops by trading classified information for cash, extravagant gifts and prostitutes.  Cases such as these are not motivated by need or other difficult personal circumstances; they are the product of simple greed.  This investigation should serve as a warning that those who compromise the integrity of the United States will face their day of reckoning.  DCIS and our law enforcement partners will pursue these crimes relentlessly.”

NCIS“Captain Dusek put greed and personal pleasure above the safety of his shipmates and, in doing so, violated his sworn oath as a naval officer,” said Andrew Traver, Director of the Naval Criminal Investigative Service (NCIS) .

According to Dusek’s plea agreement, he hand-delivered Navy ship schedules to the GDMA office in Japan or emailed them directly to Francis or a GDMA employee on dozens of occasions, each time taking steps to avoid detection by law enforcement or U.S. Navy personnel.

Dusek was lavishly rewarded for his efforts to help GDMA.  For example, according to the plea agreement, GDMA paid for a hotel for Dusek and his family at the Marriott Waikiki in Hawaii on July 19, 2010, and on Aug. 5, 2010, GDMA paid for a hotel room for Dusek at the Shangri-La in Makati, Philippines, and provided him with the services of a prostitute.

Soon after, Francis asked Dusek to exercise his influence on GDMA’s behalf by steering the aircraft carrier USS Abraham Lincoln and its associated strike group to Port Klang, Malaysia (PKCC) – a port terminal owned by Francis.  Dusek replied in a series of emails to GDMA in late August 2010 that he would make it happen.  “Good discussion with N00 (Admiral) today and convince him that PKCC is the better choice,” Dusek wrote to Francis on Aug. 21, 2010.  Three days later, Dusek reported to Francis that he had “everyone in agreement that the next CSG (Carrier Strike Group) through the AOR (area of responsibility) will stop at PKCC.  Dates will be 08-12 Oct.”  The port visit cost the United States approximately $1.6 million.

On Sept. 17, 2013, when Dusek learned that Francis and Navy personnel had been arrested, he deleted the contents of his email accounts in an effort to avoid detection by law enforcement.

To date, 10 individuals have been charged in connection with this scheme; of those, nine have pleaded guilty, including Dusek, Lieutenant Commander Todd Malaki, Commander Michael Vannak Khem Misiewicz, NCIS Special Agent John Beliveau, Commander Jose Luis Sanchez and U.S. Navy Petty Officer First Class Dan Layug.  Former DoD civilian employee Paul Simpkins awaits trial.  On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine; on Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine; and on March 18, 2016, Alex Wisidagama, a former GDMA employee, was sentenced to 63 months and $34.8 million in restitution to the Navy; the others await sentencing.

The ongoing investigation is being conducted by NCIS, DCIS and the Defense Contract Audit Agency.

Those with information relating to fraud, corruption or waste in government contracting should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD Hotline at www.dodig.mil/hotline, or call (800) 424-9098.

Source: https://www.justice.gov/opa/pr/highest-ranking-navy-official-sentenced-46-months-prison-accepting-bribes-foreign-defense 

Filed Under: Government Contracting News Tagged With: abuse, bribery, conspiracy, corruption, DCAA, DCIS, DOJ, fraud, GDMA, graft, greed, Justice Dept., kickback, Navy, NCIS, waste

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