SECNAV Censures 2 Captains as Part of ‘Fat Leonard’ Investigation

May 14, 2019 8:47 PM
Undated photo of Leonard Francis

The Secretary of the Navy administratively punished a senior captain described as a linchpin in a corruption scandal that defrauded the U.S. government of more than $34.8 million and ensnared dozens of commanders and officials in the bribery and fraud investigation, according to letters obtained by USNI News.

In a letter of censure to Capt. Heedong Choi, Richard V. Spencer criticized the officer for “leadership failures” and allegiance to Leonard Francis, president of the ship-husbanding contractor Glenn Defense Marine Asia. Francis and GDMA are at the focus of the federal investigation to steer Navy contracts to his Singapore-based company by bribing officials and skimming off inflated, fraudulent contracts.

Among the officers caught in the investigation is a now-retired officer, Capt. Ricardo Martinez, who Spencer also administratively censured last week for “misconduct” for soliciting favors and taking $15,800 in bribes while serving as a naval attaché in Indonesia and New Zealand from 2002 to 2006.

Choi’s initial posting to a 7th Fleet-command staff assignment in 2001 began what became a decade-long and “inappropriate relationship” with Francis, Spencer wrote in the secretarial letter of censure, dated April 26.

“As Flag Aide, Mr. Francis specifically described you as his means to ‘grease’ your Commander and the ‘pipeline’ between him and your Commander,” the secretary wrote. “He also said you were on his ‘payroll’ since that time because you ‘kept delivering.’”

Choi was fired last year as commander of the Navy ROTC unit at State University of New York’s Maritime College and temporarily reassigned, “based on alleged personal misconduct that is the subject of an ongoing investigation,” Navy Times reported at the time, quoting a spokeswoman.

Francis pleaded guilty in January 2015 to bribery, conspiracy to commit bribery and conspiracy to commit fraud against the United States. But he still awaits a sentencing hearing in a San Diego federal court in proceedings that a judge last week agreed to push until March 2020, court records show.

So far, several dozen senior officers, retired commanders and command staff personnel have been punished – some criminally through federal prosecution – for various roles including graft and fraud in the so-called “Fat Leonard” corruption scandal. But Choi’s actions stand out for his role helping Francis build a network of Navy officials who steered 7th Fleet and contracting offices to give favorable contracts to GDMA for port services supporting Navy ships overseas.

Francis “stated that he instructed you to pass the ‘gospel word’ of GDMA to other officers, and your actions show you did just that, contrary to ethics rules and loyalty to the U.S. Navy,” Spencer wrote.

Spencer cited numerous occasions where Choi, who commanded guided-missile destroyer USS Chafee (DDG-90) from 2008 to 2010, solicited and accepted favors and gifts from Francis worth more than $25,000. During his tenure as Chafee’s top officer, Choi got free or discounted lodging at luxury hotels in Malaysia, Singapore, Thailand and Hong Kong and accepted gifts including Dom Perignon champagne and Cohiba Maduro cigars. Francis spent about $18,000 for an “elaborate and lavish private dinner,” complete with a jazz ensemble, that Choi arranged for a marriage proposal in 2009, the letter stated.

“Your willingness to accept those gifts provided the worst type of example for subordinate officers within your chain of command and other officers who observed your interaction with Mr. Francis,” Spencer wrote.

Choi’s “inappropriate relationship” with Francis drew strong rebukes by the Navy secretary. “Your actions have cast a shadow over the reputation of all the outstanding men and women who served during your tenure in command and time in other leadership positions,” Spencer wrote. “You were in positions of importance, including that of a commanding officer of a United States Navy warship, expected to model the core values of the Navy as a leader and shape our Navy leaders of the future.

“Instead, you abused your positions to accept gifts from Mr. Francis/GDMA, improperly endorse GDMA, commit graft, conspire with Mr. Francis to defraud the United States, and obstruct justice. In addition, you made a false statement during an investigation with national security implications.”

In obstructing justice, Francis “made clear you held a higher loyalty to Mr. Francis than to the United States by wrongfully endeavoring to impede a criminal investigation into GDMA’s fraudulent business practices,” Spencer wrote. Choi told Francis of an investigation by the Naval Criminal Investigative Service and Korean authorities and gave him information “to avoid or minimize criminal and civil liability.”

Martinez, according to the censure letter, solicited gifts at Francis’ expense that included business cards, hotel discounts, dinners and electronics as he helped Francis with documents and letters to promote GDMA and help obtain Navy contracts on 13 different occasions. At one point in 2006, he sent Francis “a hand-written note and traditional wooden Maori waka huia box in connection with your employment request,” Spencer wrote. Another time Martinez gave Francis “sensitive and nonpublic information” regarding an incident involving a competing defense contractor.

“Your relationship with Mr. Francis went well beyond what a reasonable person would classify as an appropriate professional one between a naval officer and a defense contractor,” Spencer wrote, adding, “You maintained a highly inappropriate relationship with Mr. Francis/GDMA during two tours and abused the power associated with your position as a U.S. Naval Attache and senior naval officer for your own benefit.”

“You were in a position of importance, expected to model the Navy’s core values and shape our Navy leaders of the future,” he added. “Instead, you abused your position to accept gifts from Mr. Francis/GDMA.”

Gidget Fuentes

Gidget Fuentes

Gidget Fuentes is a freelance writer based in San Diego, Calif. She has spent more than 20 years reporting extensively on the Marine Corps and the Navy, including West Coast commands and Pacific regional issues.

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