The Cash, Bribery, And Prostitution Scandal That Continues To Haunt The Navy


Leonard Glenn Francis, aka “Fat Leonard,” is at the center of a scandal that has plagued the Navy for years. Fat Leonard was the CEO of Glenn Defense Marine Asia, or GDMA, a Singapore-based supplier of maritime services and naval logistics. GDMA is a husbanding agent, which manages such sundry services as arranging for tugs, docking, fuel, and supplies for the Navy when it visits a foreign port. Leonard was arrested in San Diego in November 2013.

In January 2015, Francis pleaded guilty to charges of bribery, conspiracy to commit bribery, and conspiracy to defraud the United States. He admitted to providing Navy officials with millions of dollars in gifts and expenses, including luxury travel, $500,000 in cash, and prostitutes. His sentencing is scheduled for later this year.

In exchange for bribes, Francis received confidential ship schedules for the Navy’s 7th Fleet, along with pricing information about bids submitted by competitors. This allowed his company to overcharge the government in excess of $20 million. As part of the plea, Francis and GDMA agreed to forfeit $35 million.

The following is a list of members of the Navy who have been punished, listed by seniority junior to senior:

  • Petty Officer 1st Class Daniel Layug pleaded guilty in federal court to providing classified information in exchange for $10,000 and electronic gadgets.
  • Commander Jose Luis Sanchez pleaded guilty in federal court to accepting $100,000 in cash, travel, and prostitutes.
  • Commander Michael Misiewicz pleaded not guilty in federal court  to charges of bribery. His case is pending.
  • Naval Criminal Investigative Service Special Agent John Beliveau, Jr., pleaded guilty in federal court to using his law-enforcement training to help Francis avoid detection in exchange for cash and lavish travel.
  • Captain Daniel Dusek, USN, pleaded guilty to bribery.  He provided classified information to Leonard “dozens of times,” in exchange for luxury hotel stays and prostitutes.  Sentencing scheduled for 3 April 2015.
  • Capt. David Haas was suspended as commander of Coastal Riverine Group 1, on Nov. 15, 2013, “based upon allegations in connection with an ongoing Naval Criminal Investigative Service investigation into Glenn Defense Marine,” according to a Navy Expeditionary Combat Command news release.
  • Vice Adm. Michael Miller received a letter of censure, in February 2015, for improperly accepting gifts from Leonard, and was permitted to retire.
  • Rear Adm. David Pimpo received a letter of censure, in February 2015, for improperly accepting gifts from Leonard, and was permitted to retire.
  • Rear Adm. Terry Kraft received a letter of censure, in February 2015, for improperly accepting gifts from Leonard, and was permitted to retire.
  • Rear Adm. Bruce Loveless had his security clearance suspended in November 2013 due to the pending investigation into his connection to the Fat Leonard scandal. No further action has been taken by the Navy in his case.
  • Vice Adm. Ted “Twig” Branch currently serves as the Navy’s top intelligence officer, though a replacement, Rear Adm. Elizabeth Train, was nominated by the Navy in November 2014.  According to the Navy, Train’s nomination will likely be acted on by Congress in early 2015.  Branch’s security clearance was suspended in November 2013 after being investigated for misconduct related to the Fat Leonard scandal.

It is obvious from the above list that the more senior the individual the less severe the punishment. This is not an exhaustive list, as the Navy has not released a comprehensive list of personnel involved in the Fat Leonard scandal.

Preferential treatment for general officers and admirals is not limited to the Navy. It has been a recurring issue in all of the military services.

The recent testimony of Secretary of the Navy Ray Mabus illustrates this point. During a Senate hearing on Mar. 10, in response to Sen. Claire McCaskill of Missouri who asked about the accountability of those senior leaders under whom this scandal occurred, Mabus responded, “I have already issued letters of censure to three admirals [Miller, Pimpo, and Kraft], one three-star, two two-star admirals. The two two-stars [Pimpo and Kraft] elected to retire. The three-star [Miller] had already decided to retire.”

Mabus went on, “And one thing I do want to say, though, is that you could have all the ethics training in the world. If somebody does not know it is wrong to steal, if somebody does not know it is wrong to take a bribe, they miss something at home.”

The reality is that the three admirals — Miller, Pimpo, and Kraft — received no punishment. These letters of censure are completely meaningless. According to Navy regulations, a letter of censure is a communication “to subordinate officers that may be in the nature of a reprimand” and “a copy of the letter will be filed in the official record of the member.”

Take the example of Miller. He last served as superintendent of the United States Naval Academy, a post from which he was scheduled to retire from in July of 2014. During his retirement ceremony he was awarded a medal for distinguished service and thanked by Mabus for his “incomparable service.”

The letter of censure, or reprimand, will be placed in Miller’s official Navy record. But it will not impact his pay, he will not serve any time in the brig, he will not be fined, nor demoted. Additionally, under current regulations, Miller will make “considerably more” in retirement pay than he did on active duty. Thus, in Miller’s case, this letter of censure resulted in a pay raise. It is difficult to characterize this holding Miller accountable.

The treatment of Pimpo also demonstrates just how truly meaningless a letter of censure is. Pimpo had previously been subject to administrative action, in February 2014, for violating federal regulations for staying at a costly hotel and taking unnecessary and expensive flights. An administrative action is the equivalent of a letter of censure or reprimand. This previous administrative action didn’t prevent Pimpo from being promoted. So while he was subject to two administrative actions, he will not lose any retirement pay, nor will he suffer any other adverse action.

Undoubtedly, letters of censure are absolutely meaningless and have no impact on the lives of these senior officers.

It may be that these senior officers were just less culpable than the junior personnel who received substantially more punishment. We don’t know. The Navy press release issued on Feb. 10 gives scant details about the incident. The review by the Navy “concluded that these officers [Miller, Pimpo, and Kraft] violated the Standards of Ethical Conduct, U.S. Navy Regulations, and/or the Joint Ethics Regulation, demonstrating poor judgment and a failure of leadership. … the solicitation and acceptance of these gifts ... cultivated an unacceptable ethical climate within the respective commands.”

Were these “gifts” a nominal amount, for example, a meal that was $5 over the regulatory limit, or a substantial amount, such as a $5,000 bribe? Did these senior officers “solicit” insubstantial gifts, such as unit coins, or much more insidious gifts, such as prostitutes? We will never know, as details of these administrative actions were not released by the Navy. But given the actions of the other junior personnel involved in the Fat Leonard scandal, this disregard for ethics is not unheard of.

What we do know is that each of these admirals violated the Joint Ethics Regulations, violations of which are punishable under the Uniform Code of Military Justice. That is to say, each of these admirals could have faced a court martial. But they did not, they received essentially meaningless letters of censure and were allowed to retire.

An even more pernicious form of favoritism is taking no action against senior officers. The cases of Branch and Loveless illustrate this point.

Branch, the director of naval intelligence, is unable to do his job because he lacks a security clearance. If, during a meeting, classified information is discussed, Branch must leave the meeting. As director of naval intelligence, most if not all, meetings would assuredly include classified information. Yet, Branch has allowed to serve as director of naval intelligence for over a year, without a security clearance and despite his inability to do his job. Any junior member of the Navy would have been immediately removed from such a position.

It is abundantly clear that true punishments do not go into the rarefied air inhabited by flag officers.

The failure of the Navy to hold senior officers accountable concerns the rank and file of the military. According to an active-duty Navy captain quoted by the Navy Times, “When [senior officers walk] around and say that there isn't a trust deficit between junior officers and senior leadership, it's things like this that call b------- on that."

To ensure trust in the military justice system by all service members, it is imperative that all members of the military are treated equally. Allowing an untouchable cadre of general officers and admirals to lord over the great unwashed masses of the military breeds contempt and distrust of the institution. This must end. Our all-volunteer military must be equally held accountable for their actions, from seaman recruits to admirals.

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