Navy Secretary Ray Mabus said Friday that he bluntly told criminal investigators to pursue a widening bribery scandal “wherever it leads” and that he expects more people to get swept up in a case that has already tarred several senior officers and exposed an international, multimillion-dollar fraud scheme.
“I certainly don’t think we’ve seen the end of it,” Mabus told reporters at the Pentagon in his first public comments on the scandal since it came to light in September. “I would rather get bad headlines than let bad people get away.”
Mabus, the Navy’s top civilian official since 2009, spoke a day after he held an unusual video conference with the Navy’s fleet commanders and other admirals around the world to emphasize the need to uphold ethical standards and prevent contracting fraud. With the scandal showing no sign of abating, he also has ordered several reviews and an audit into how the Navy pays for port services.
The Navy has been tarnished by a succession of embarrassing revelations over the past three months about its relationship with a major foreign defense contractor, Singapore-based Glenn Defense Marine Asia, that has provided port services to U.S. ships and submarines in the Pacific for a quarter-century.
So far, two Navy commanders have been arrested and charged with taking bribes from the company in the form of cash, luxury travel and prostitutes. Two captains have been suspended or reassigned by the Navy. And two admirals who work in Navy intelligence have had their access to classified materials suspended while investigators scrutinize their possible involvement.
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In addition, a senior agent with the Naval Criminal Investigative Service pleaded guilty in federal court this week to taking bribes in exchange for leaking inside information to Glenn Defense Marine about the progress of multiple federal probes targeting the firm. Prosecutors estimate that the government was cheated out of more than $20 million by the alleged fraud scheme.
The president of Glenn Defense Marine, Leonard Glenn Francis — a Malaysian national known as “Fat Leonard” in Navy circles — was arrested in September along with another executive during a sting operation. Francis has pleaded not guilty in federal court and is being held without bail in California.
At his news conference, Mabus shed some new light on the apprehensions. He said investigators lured Francis from Singapore to San Diego to meet with Navy officials by planting false information in law enforcement databases indicating that the probes targeting the firm had fizzled and that no charges would be brought. The investigators suspected, correctly, that the rogue NCIS agent would feed the false information to Francis and make him think it was safe to travel to the United States to seek more business from the Navy.
Mabus said other NCIS agents began investigating Glenn Defense Marine in May 2010, “based on suspicious claims and invoices the company submitted to the Navy, claims that internal processes Navy had set up helped reveal.”
Federal court records filed by prosecutors assert that the initial investigation stalled for lack of evidence and because the rogue NCIS agent and Navy officers taking bribes advised Francis how to dodge the inquiry.
Despite lingering suspicions, the Navy continued to sign lucrative business deals with Glenn Defense Marine, including a $1 million no-bid contract extension in July. Mabus defended the arrangements, saying Navy contracting officials were intentionally not told about the law enforcement investigation. He also said that suspending contracts with the company while the probe was still unfolding would have tipped it off “that something was wrong.”
The scandal is just one in a flurry of misconduct cases involving senior military officials that have dogged the Defense Department over the past year.
On Thursday, the Air Force released an investigative report documenting how a two-star general in charge of nuclear weapons repeatedly drank too much and consorted with suspicious foreign women during an embarrassing four-day business trip to Moscow in July.
In October, the Navy relieved a three-star admiral from his post as deputy commander of the U.S. Strategic Command, which oversees all nuclear-armed missiles, bombers and submarines. In that case, Vice Adm. Tim Giardina was allegedly caught using counterfeit gambling chips during a visit to a casino.
Mabus said the misbehavior was limited to a “few” people in the service, but at the same time expressed frustration by saying that there was only so much the Navy could do to prevent some officers from acting badly.
“This not only goes against all the ethics rules that we have, these few people that are alleged to have done these things; this goes against everything you should have learned at home,” he said. “I mean, everybody knows it’s wrong to take a bribe. Everybody knows it’s wrong to get paid to give a contract.”