UNITED STATES

US Navy bribery scandal expected to widen

Deals with contractors may have involved hundreds of millions of dollars, officials say

PUBLISHED : Sunday, 22 December, 2013, 5:49am
UPDATED : Sunday, 22 December, 2013, 5:49am
AP

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The US Navy has not seen the end of the multimillion-dollar bribery and contracting scandal that has implicated several contractors and naval personnel, Navy Secretary Ray Mabus said, warning that more disclosures are coming.

Speaking at the Pentagon, Mabus declined to reveal how much money is involved in the widening probe, but officials have estimated it could be in the hundreds of millions of dollars. He said the navy would continue to aggressively investigate and prosecute any officers or contractors who may be involved.

So far, six naval officers have been implicated in the bribery scheme, including three who have been arrested. The case involves allegations that officials accepted pricey vacations and prostitute services in exchange for providing information and advice to an Asian defence contractor who then overbilled the navy for port services.

An agent with the Naval Criminal Investigative Service (NCIS), John Beliveau, pleaded guilty on Tuesday to bribery charges. And officials have said his plea deal could expand the investigation if he co-operates with authorities as part of the agreement.

"I expect we will continue to see headlines resulting from the discovery and disposition of these cases," Mabus said. "The navy has a long tradition of transparency when we uncovered allegations of misconduct, particularly against high-ranking officers, because not only can the spotlight act as a deterrent, but mostly because it's the right thing to do. I would rather get bad headlines than let bad people get away."

Beliveau acknowledged keeping Malaysian contractor Leonard Glenn Francis - known in military circles as "Fat Leonard" - up to speed on the years-long fraud investigation that NCIS agents were conducting into Francis' company, Glenn Defence Marine Asia (GDMA).

In exchange, Francis paid for plane tickets, hotels and prostitutes for Beliveau, 44, according to the plea agreement. Francis has pleaded not guilty in the case that alleges GDMA overbilled the navy by at least US$20 million for port services.

Two navy officers have also been charged in the case. In addition, two admirals have lost their security clearances and two other navy officials have been relieved, but they have not been charged.