(Washington Post) The U.S. Navy is being rocked by a bribery scandal that federal investigators say has reached high into the officer corps and exposed a massive overbilling scheme run by an Asian defense contractor that provided prostitutes and other kickbacks.
Among those arrested on corruption charges are a senior agent for the Naval Criminal Investigative Service and a Navy commander who escaped Cambodia’s “killing fields” as a child only to make a triumphant return to the country decades later as the skipper of a U.S. destroyer.
The investigation has also ensnared a Navy captain who was relieved of his ship’s command this month in Japan.
The chief executive of the Singapore-based defense contractor, Glenn Defense Marine Asia, and another company official were arrested last month at a San Diego harborside hotel after federal investigators lured them to the United States by arranging a sham meeting with Navy officials, according to court records and people involved in the case.
The unfolding investigation is shaping up as the biggest fraud case in years for the Navy.
Federal prosecutors allege that Glenn Defense Marine, which has serviced and supplied Navy ships and submarines at ports around the Pacific for a quarter-century, routinely overbilled for everything from tugboats to fuel to sewage disposal.
Investigators are still assessing the scope of the alleged fraud, but federal court records filed in San Diego cite a handful of episodes that alone exceeded $10 million. . . .
. . . . According to court papers filed by federal prosecutors in San Diego, Francis and others in his company targeted Navy personnel serving in Asia and plied them with prostitutes, cash, luxury hotel rooms, plane tickets and, on one occasion last year, tickets to a Lady Gaga concert in Thailand.
In exchange, Francis sought inside information on ship deployments and pressed at least one high-ranking commander to steer aircraft carriers and other vessels to ports where his firm could easily overcharge the Navy for pierside services, the court documents allege. . . .
Since 2011, Glenn Defense Marine has been awarded Navy contracts worth more than $200 million. The company also services ships from several navies in Asia.. . .
. . . . In May 2010, according to court papers filed by federal investigators, Francis and an unnamed manager from his firm “began targeting” Cmdr. Michael Misiewicz, a graduate of the Naval Academy in Annapolis, “as someone who might be susceptible to providing favor . . . in return for things of value.” . . . (read the rest)
International Bribery Schemes Uncovered Involving Hundreds of Millions of Dollars in Defense Contracts (DOJ Press Release)
Second contractor charged in Navy fraud, bribery case (Stars & Stripes)
A second high-ranking official from the multi-national defense contractor Glenn Defense Marine Asia has been charged in the fraud and bribery scandal that also has ensnared two Navy officers and a Naval Criminal Investigative Service agent.
Alex Wisidagama, GDMA’s general manager for global government contracts, was charged on Oct 11 with defrauding the U.S. government in U.S. District Court in San Diego, according to court documents.
The complaint, filed by the U.S. attorney’s office, states that Wisidagama and others submitted hundreds of false bids, allegedly from competitors, for non-fixed price items like fuel and trash collection to the U.S. Navy. They also allegedly inflated fuel prices and submitted fraudulent invoices for tariffs from non-existent port authorities so they could overcharge the U.S. Navy.
Investigators believe the fraud cost the U.S. government upwards of $2.3 million in Thailand alone, according to the complaint. . . (read more)