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3 Held in High-Rolling Navy Bribe Scam

Friday, September 20, 2013

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Luxury travel and prostitutes were exchanged for secret information and hundreds of millions of dollars in Navy service contracts, according to federal charges filed this week in two bribery schemes.

A Navy commander, a Navy criminal agent, and the CEO of a shipping services multinational have all been charged in the scheme, the U.S. Attorney's Office in the Southern District of California announced Tuesday (Sept. 17).

The defendants are:

  • U.S. Navy Commander Michael Vannak Khem Misiewicz;
  • John Bertrand Beliveau II, a Naval Criminal Investigative Service supervisory special agent; and
  • Leonard Glenn Francis, CEO of Glenn Defense Marine Asia Ltd.

Three Defendants

Francis is a Malaysian national who lives in Singapore, according to the complaints. Singapore-based Glenn Defense Marine Asia (GDMA) operates throughout Asia, Australia and the United States.

Glenn Defense Marine Asia
Glenn Defense Marine Asia

GDMA provides "husbanding" services to U.S. Navy ships in addition to hull cleaning and painting and vessel repair. GDMA is under federal investigation for possible fraud.

The contractor provides hundreds of millions of dollars in "husbanding" services to the U.S. Navy, which involves coordinating, scheduling and procuring services for ships and submarines arriving at port. These services include paying authority and customs fees, providing security and transportation, providing tugboats, and collecting liquid waste.

GDMA also offers ship maintenance services, including hull cleaning and painting and vessel repair, according to the company's website.

Misiewicz is assigned to U.S. Northern Command at Peterson Air Force Base in Colorado Springs, CO, and was previously deputy operations officer for the U.S. Commander, Seventh Fleet aboard the USS Blue Ridge—a position that gave him "high-level exposure" to operational planning for Seventh Fleet ships and any U.S. Navy ship traveling through the fleet's 48 million-square-mile area of responsibility.

He was also influential in determining or modifying the schedule of port visits for Navy vessels, the Justice Department said.

Beliveau, a supervisory special agent for NCIS in Quantico, VA, had access to the internal NCIS database, which included reports into an NCIS investigation into possible Navy contract billing fraud by GDMA.

Complaint Allegations

One criminal complaint alleges that Misiewicz and Francis engaged in a conspiracy to commit bribery, and that Misiewicz sent Francis information classified as "Confidential" by the Navy, including schedules of Navy ship movements months in advance.

Additionally, Misiewicz allegedly "operated as an advocate" for GDMA's benefit by urging decisions about port visits and contractor usage. The two would communicate privately via a special personal email account, the complaint alleges.

Navy bribery scheme
Left: Glenn Marine Group; Right: U.S. Navy Mass Communication Specialist 3rd Class Devon Dow

Leonard Glenn Francis (left), CEO of GDMA, allegedly provided luxury trips and prostitutes to U.S. Navy Commander Michael Misiewicz (right) and NCIS special agent John Beliveau (not shown).

The second complaint alleges that Beliveau and Francis had a separate bribery conspiracy where Beliveau provided Francis with secretly downloaded reports that included confidential information about the NCIS investigation into GDMA. Beliveau would then allegedly guide Francis on how to deal with the inquiries.

Travel and Prostitutes

In return, Francis allegedly provided both men with "paid travel, luxury hotel stays and prostitution services."

According to one complaint, while in Bangkok, Thailand, in 2011, Francis had emailed Beliveau a photo of a female escort with the message, "Joyce your kinda Babe?"

To which Beliveau alleged replied, "Nice. You bet. Hopefully I'm her kinda guy, hehe." Additional emails between the escort and Francis show that she was paid for three days and airfare.

Shortly after this trip, Beliveau emailed Francis to counsel him on the pending criminal investigation into GDMA, the complaint alleges.

Ongoing Investigation

All three were arrested on Monday (Sept. 16), authorities said. Francis was arrested in San Diego, Misiewicz in Colorado, and Beliveau in Virginia. Each defendant was charged with conspiring to commit bribery, which carries a maximum penalty of five years in prison.

Francis made his initial appearance in federal court Tuesday afternoon before U.S. Magistrate Judge Karen S. Crawford and will remain in custody without bond pending his hearing at 9:30 a.m. PT today (Sept. 20) to determine whether he should be detained as a flight risk and as a risk to obstruct justice. The United States is seeking to remove to Misiewicz and Beliveau to San Diego to face charges.

The ongoing investigation is being conducted by NCIS, the Defense Criminal Investigative Service, the Defense Contract Audit Agency and the Drug Enforcement Administration. The Royal Thai Police and the Corrupt Practices Investigation Bureau Singapore also provided law enforcement assistance, and the Criminal Division's Office of International Affairs assisted.

The case is being prosecuted by Assistant U.S. Attorneys Mark Pletcher and Robert Huie of the Southern District of California and Catherine Votaw, Director of Procurement Fraud for the Criminal Division's Fraud Section.


Tagged categories: Ethics; Government contracts; Laws and litigation; Shipyards; U.S. Navy

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