John Beliveau II, Navy Investigator, Will Plead Guilty In Multimillion-Dollar Fraud Case: Attorney

12/17/2013 09:52 am ET
Stephen St. John via Getty Images

SAN DIEGO (AP) — A senior Navy criminal investigator downloaded more than 100 confidential files for an Asian defense contractor at the center of a multimillion-dollar fraud investigation, prosecutors say.

In exchange for his tips, John Beliveau II accepted luxury trips from the Malaysian defense contractor, Leonard Glenn Francis, who would arrange for prostitutes to meet him, according to charging documents.

Beliveau's attorney said his client will plead guilty to bribery charges Tuesday in federal court in San Diego. The conviction will be a first for federal prosecutors in the massive scandal that has netted the arrests of three Navy officials and prompted the military branch to suspend two admirals' access to classified material.

Beliveau's lawyers and prosecutors declined to say whether Beliveau would now cooperate with authorities.

Francis, the 49-year-old CEO of Singapore-based Glenn Defense Marine Asia Ltd., or GDMA, offered bribes to Navy officers in exchange for confidential information — including ship routes, authorities say, or for following his requests to move Navy vessels to Asian ports with lax oversight so the company could inflate costs and invent tariffs by using phony port authorities.

In exchange, Francis, who is known in military circles as "Fat Leonard" because of his wide girth, lined up prostitutes, luxury hotel stays and tickets to shows for the Navy officials, including a Lady Gaga concert in Thailand, according to a criminal complaint.

The company bilked the Navy out of $10 million in just one year in Thailand alone, U.S. Attorney Laura Duffy said.

Francis, who was arrested in September, and his cousin, Alex Wisidagama, a company manager who was also arrested, have pleaded not guilty. Navy Cmdr. Jose Luis Sanchez and Cmdr. Michael Vannak Khem Misiewicz also have pleaded not guilty.

According to the complaint, Beliveau, 44, not only kept Francis abreast of the bribery probe but advised him on how to respond, as well as downloaded sensitive records from the case files of his fellow Naval Criminal Investigative Service agents. Prosecutors believe Beliveau later shared the details with Francis.

The two exchanged thousands of text messages, according to charging documents.

At one point, Francis bragged to an associate in an email: "I have inside Intel from NCIS and read all the reports," according to court documents.

Beliveau faces a maximum sentence of 20 years.

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