Two U.S. admirals — including the director of naval intelligence — are under investigation as part of a major bribery scandal involving a foreign defense contractor, Navy officials announced Friday night.
Vice Adm. Ted Branch, the service’s top intelligence officer, and Rear Adm. Bruce Loveless, the Navy’s director of intelligence operations, were placed on leave Friday, and their access to classified material was suspended, the Navy said in a statement.
(http://www.navy.mil/) - Rear Admiral Bruce F. Loveless, Director of Intelligence Operations.
U.S. Navy moles reportedly aided businessman’s fraud
Prosecutors say the Malaysian man received information about contracts and law-enforcement probes.
Both admirals are being investigated for their ties to a Singapore-based defense contractor, Glenn Defense Marine Asia, whose chief executive was arrested in September on charges that he bribed other Navy officers into giving him classified information in exchange for prostitutes and cash.
Two Navy commanders and a senior Naval Criminal Investigative Service agent have already been arrested in the case, and a captain was relieved of his ship’s command last month after officials said he was under investigation as well.
But the announcement that two admirals in charge of protecting the Navy’s secrets have been swept up in the investigation makes the case the worst to tar the Navy since the 1991 Tailhook sexual-harassment scandal, which resulted in the demotions, firings or early retirements of more than a dozen admirals.
The Navy did not disclose why Loveless and Branch had drawn the scrutiny of investigators but said their alleged misconduct occurred prior to their current assignments and before they became admirals.
“There is no indication, nor do the allegations suggest, that in either case there was any breach of classified information,” Rear Adm. John F. Kirby, the Navy’s chief spokesman, said in a statement.
Neither Branch nor Loveless has been charged with a crime or service violation, and both men retain their rank while the investigation proceeds, the Navy said.
The suspension of two senior intelligence officials raises serious questions about the degree to which national security may have been compromised because of improper contact between Navy officers and Glenn Defense Marine.
Prosecutors from the U.S. attorney’s office in San Diego have charged the two Navy commanders with passing classified information about ship and submarine movements to Leonard Glenn Francis, a Malaysian national and the chief executive of Glenn Defense Marine.
Navy contracting officials raised suspicions about Francis — who is known as “Fat Leonard” in Navy circles because of his imposing girth — as far back as 2005. But prosecutors allege he was able to dodge scrutiny by bribing Navy officers and the NCIS agent for inside information about law-enforcement probes and contract audits.
To recruit the moles, Francis plied the officers with female escorts, cash, paid travel and other perks, including tickets to a Lady Gaga concert in Thailand and the “Lion King” musical in Japan, according to court records.
Glenn Defense Marine has serviced and supplied Navy ships and submarines at ports around the Pacific for a quarter-century, providing fuel, tugboats, sewage disposal, wharfside security and other assistance.
Francis and his company were familiar faces to Navy brass, including the commanders of virtually every vessel in the Pacific. The company was rewarded in 2011 with new contracts valued up to $200 million.
Prosecutors, however, allege that the firm routinely overbilled for everything from tugboats to fuel to sewage disposal, defrauding the Navy of more than $10 million.
Francis sought inside information on ship deployments and pressed at least one commander to steer aircraft carriers and other vessels to ports where his firm could easily overcharge the Navy for services, court documents allege.
Earlier Friday, Francis and one of the Navy commanders charged in the case, Michael Vannak Khem Misiewicz, appeared in federal court in San Diego for a procedural hearing.
Prosecutors told the court that they would be seeking an order to prohibit defense attorneys from circulating or sharing evidence. They noted that the NCIS agent, John B. Beliveau II, is charged with giving sensitive law-enforcement files to Francis to help him avoid scrutiny.
Francis is being held without bond after prosecutors argued that, as a Malaysian citizen, he posed a flight risk. His attorney and a spokeswoman for Glenn Defense Marine have declined to comment on the allegations against him.
The U.S. military has never been immune from contracting scandals, but it is extremely rare for senior uniformed commanders to face corruption charges.
It is unclear how well Branch or Loveless may have known Francis. But both admirals have spent parts of their careers deployed to Asia.
Branch, an aviator, previously was an executive assistant to the commander of the Pacific Fleet. He was promoted to vice admiral in July when he took over as director of naval intelligence.
Loveless assumed his current job at the Pentagon in February. He also commanded the U.S. Pacific Command’s Joint Intelligence Operations Center, based at Pearl Harbor, from 2009 to 2012.
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