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Friday
Jun102016

Admiral pleads guilty to lying in Fat Leonard bribery scandal

The highest-ranking U.S. Navy officer to be charged in the massive bribery-for-secrets case that has shaken the Navy's command structure in the Pacific pleaded guilty Thursday in federal court to lying to investigators and destroying evidence.

U.S. Navy Rear Admiral Robert Gilbeau, 55, of Burke, Virginia, tried to hide his illicit years-long relationship with Leonard Glenn Francis -- known as Fat Leonard -- owner of the Singapore-based defense contractor at the center of the scandal.

Gilbeau, pictured above, pleaded guilty to one count of making a false statement. Sentencing is scheduled for August 26 in federal court in San Diego.

Fourteen individuals have been charged in the case. Ten of them have pleaded guilty.

Gilbeau destroyed documents and deleted computer files when he learned that Francis and others had been arrested for fraud and bribery in September 2013.

He admitted Thursday that he lied when he told agents from DCIS and NCIS that he never took any gifts from Francis or his company, Glenn Defense Marine Asia. 

He also told investigators that he “always paid for half of the dinner” when he and Francis met about three times a year. 

Francis, 51, pleaded guilty to bribing scores of U.S. Navy officials with luxury travel, meals, cash, electronics, parties, and prostitutes.

Federal agents arrested the Malaysian citizen after luring him to San Diego to talk about rich new contracts.

In 2003 and 2004, Gilbeau was the supply officer on the USS Nimitz, a nuclear powered aircraft carrier and one of the biggest warships in the world.

Glenn Defense Marine Asia provided U.S. Navy ships at ports throughout Asia with food, fuel, cleaning, and other port services.

Gilbeau later served as head of the Tsunami Relief Crisis Action Team in Singapore, heading the Navy’s logistics response to the Southeast Asia tsunami in December 2004.

In mid 2005, Gilbeau was assigned to the office of the Chief of Naval Operations as the head of aviation material support.

He was promoted to admiral in August 2010. He then directed the Defense Department's most critical contracts performed outside the United States, according to his plea agreement.

In February 2015, three rear admirals including the commander of naval forces in Japan retired after the secretary of the Navy censured them for the Fat Leonard scandal.

Naval Forces Japan commander Rear Admiral Terry Kraft and rear admirals Michael Miller and David Pimpo received censure letters from Secretary Ray Mabus. The letters were intended to “document their failure of leadership” for the handling of Glenn Defense Marine Asia between 2006 and 2007.

None of them have been charged with criminal activity in the case.

Last month, three senior Navy officers -- two of them active and one retired -- were charged in in the case.

They are Navy Captain Michael Brooks, 57, of Fairfax Station, Virginia, Commander Bobby Pitts, 47, of Chesapeake, Virginia, and Lieutenant Commander Gentry Debord, 47, who's based in Singapore.

Brooks and Debord each face one count of conspiracy to commit bribery. Pitts faces one count of conspiracy to defraud the United States and two counts of obstruction of justice.

Brooks served as the U.S. Naval Attaché to the Philippines in the U.S. Embassy in Manila from 2006 to 2008. In exchange for travel and entertainment expenses, hotel rooms, and the services of prostitutes, he allegedly arranged diplomatic clearances for Glenn Defense Marine Asia vessels.

Diplomatic clearance limited the amount of custom fees and taxes the company paid in the Philippines and allowed the vessels to avoid all cargo inspections. 

 Five individuals including four U.S. Navy officers have been sentenced in the case:

Petty Officer First Class Dan Layug, jailed 27 months

Lieutenant Commander Todd Malaki, sentenced to 40 months in prison

Alex Wisidagama, a former GDMA employee, sentenced to 63 months in prison and ordered to  pay $34.8 million in restitution to the Navy

Captain Daniel Dusek, sentenced to 46 months in prison, and

Captain Michael Misiewicz, sentenced to 78 months in prison.

NCIS Special Agent John Beliveau and U.S. Navy Commander Jose Luis Sanchez have pleaded guilty and are waiting to be sentenced.

Former Department of Defense Senior Executive Paul Simpkins awaits trial.

The Washington Post has called the Fat Leonard scandal "perhaps the worst national-security breach of its kind to hit the Navy since the end of the Cold War."

In a statement Thursday, the DOJ's Leslie Caldwell said: “As a flag level officer in the U.S. Navy, Admiral Gilbeau understood his duty to be honest with the federal agents investigating this sprawling bribery scheme.”

“By destroying documents and lying about the gifts that he received, Admiral Gilbeau broke the law and dishonored his uniform,” Caldwell said.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He'll be the keynote speaker at the FCPA Blog NYC Conference 2016.