“Fat Leonard” Francis

The decades-long “Fat Leonard” bribery and corruption scandal may finally have come to an end.  This week, Malaysian ship-supply contractor, Leonard Glenn Francis, 60, known as “Fat Leonard” was sentenced to 15 years in prison for bribing US Navy officials to secure tens of millions of dollars in military contracts.

The New York Times reports that, as part of his sentence, Mr. Francis was also ordered to pay $20 million in restitution to the Navy and a $150,000 fine, and he was forced to forfeit $35 million in “ill-gotten proceeds from his crimes.”

In exchange for hundreds of thousands of dollars in cash, travel expenses and other luxury gifts, Mr. Francis and his company received classified information that included information about competitors’ bids for US Navy contracts, prosecutors said.

As part of his sentence, Mr. Francis was also ordered to pay $20 million in restitution to the Navy and a $150,000 fine, and he was forced to forfeit $35 million in “ill-gotten proceeds from his crimes,” prosecutors said on Tuesday.

In exchange for hundreds of thousands of dollars in cash, travel expenses and other luxury gifts, Mr. Francis and his company received classified information that included information about competitors’ bids for US Navy contracts, prosecutors said.

The Cost of Corruption

In addition to the direct cost of Fat Leonard’s overbilling the Navy, the scandal damaged the Navy by undermining the integrity of its forces, and weakening the public’s trust in senior leaders, and costing the taxpayer millions of dollars. Francis’s actions degraded the readiness of the 7th Fleet and shook the trust of its leadership.

The scope of the corruption investigation inadvertently hindered the Navy’s ability to fill senior leadership roles, delayed hundreds of officers’ careers and depleted the Navy’s admiralty. Hundreds of those who had not been compromised needed investigation and clearance.

Sam LaGrone, writing in USNI News observed that the six-year-long Department of Justice-led probe into the Fat Leonard scandal resulted in 33 federal indictments, 22 guilty pleas and Francis admitting to authorities that his company, Glenn Defense Marine Asia (GDMA), had overbilled the Navy by $35 million to support port visits by U.S. warships.

But to get to that total, hundreds of personnel serving in the Pacific who had not committed any crimes had to be investigated and cleared. That process placed a countless number of officers on hold with no information on their status and no timeline for being freed from suspicion – a process that sometimes took years – as former Secretary of the Navy Ray Mabus told USNI News in an interview.

“If Leonard Francis mentioned somebody’s name, or it seemed to us that if somebody had served in a senior position in the Pacific during this time, which covered a lot of folks, they were caught up in this until their name could be pulled out,” Mabus said. “It took in a huge percentage of flag officers, and it really hamstrung the Navy in terms of promotions, in terms of positions.”

The sheer volume of Navy personnel exposed to Francis is indicative of how ubiquitous GDMA’s reach was in the Western Pacific from the late 1990s to his 2013 arrest. The Japan-based U.S. 7th Fleet relied heavily on GDMA to carve out places where U.S. warships could make port calls as Washington wrestled with Beijing for influence in the South China Sea, several officers who served in 7th Fleet have told USNI News.

China was at the time seen as the U.S. Navy’s greatest adversary, and therefore the best and brightest officers in the service cycled through deployments in 7th Fleet. Many of those same officers’ promotions were later put on hold while the investigation was ongoing, with the effects rippling up to the highest levels of the service.

While the total number of Navy personnel DoJ has under investigation is unknown, as of early 2018 Justice had passed to the Navy almost 450 names that they elected not to prosecute. Of those, the Navy elected to take a handful to court-martial, issue seven letters of censure from the Secretary of the Navy, and issue about 40 other administrative actions. As of early 2018, there were about 170 names still pending.

“It’s really been pretty devastating to the upper ranks of the Navy,” Mabus told USNI News. “There were bad people here. You gotta catch them. You got to make sure they’re punished. But there were a lot of people that didn’t do anything that got caught up in this.”

In 2018, a senior U.S. Pacific Command staffer told a room of Australians, when asked about the ongoing case, “China could never have dreamt up a way to do this much damage to the US Navy’s Pacific leadership.”