In the absence of a new NCIS episode this week, we thought we’d bring you the true story of what happens when a supervisor like Leroy Jethro Gibbs becomes corrupt. While the one-hour shows are entertaining, this lengthy account will be informative as it reveals how NCIS works in real life. The following article, written by Craig Whitlock, appeared in the Washington Post on December 27, 2016. Whitlock reports that in October 2016, John Beliveau II, a turncoat NCIS supervisor, was sentenced to 12-years in prison.
Here is Mr. Whitlock’s article, which is worth reading to the end where you will see how NCIS finally achieved their evidence in a surprising twist:
“The Navy allowed the worst corruption scandal in its history to fester for several years by dismissing a flood of evidence that the rotund Asian defense contractor was cheating the service out of millions of dollars and bribing officers with booze, sex and lavish dinners, newly released documents show.
The Singapore-based contractor, Leonard Glenn Francis, found it especially easy to outwit the Naval Criminal Investigative Service (NCIS), the renowned law enforcement agency that has inspired one of the longest-running cop shows on television.
Starting in 2006, in response to a multitude of fraud complaints, NCIS opened 27 separate investigations into Francis’s company, Glenn Defense Marine Asia. In each of those instances, however, NCIS closed the case after failing to dig up sufficient evidence to take action against the firm, according to hundreds of pages of law enforcement records obtained by The Washington Post under the Freedom of Information Act.
Known as Fat Leonard for his 350-pound physique, Francis held lucrative contracts to resupply U.S. warships and submarines in ports throughout Asia. He was also legendary within the Navy for throwing hedonistic parties, often with prostitutes, to entertain sailors.
Other Navy documents obtained by The Post show that staffers at U.S. Pacific Fleet headquarters were so worried about the potential for trouble that they drafted a new ethics policy to discourage Navy personnel from accepting favors from Francis. But their effort was blocked for more than two years by admirals who were friendly with the contractor, according to officials familiar with the matter.
Despite rising signs of widespread fraud, the Navy kept awarding business to Francis’s company. In 2011, Glenn Defense won deals valued at $200 million to service U.S. vessels at ports stretching from the Russian Far East to Australia.
It took NCIS agents and federal prosecutors until 2013 to gather enough evidence to charge Francis and arrest him in a sting operation in San Diego. He has been in federal custody since then, having pleaded guilty to defrauding the Navy of $35 million.
His sentence is pending. One of his attorneys, Ethan M. Posner, said Glenn Defense “had an extraordinary record in securing the Navy’s vessels and protecting American naval personnel.” He declined to comment further.
Besides Francis, 12 people —including an Admiral and nine other Navy personnel — have pleaded guilty to federal crimes. Five other defendants still face charges.
Justice Department officials say there is no end in sight to the investigation and that 200 people have fallen under scrutiny. Among them are about 30 current or retired admirals, according to Navy officials.
NCIS officials declined to comment in detail about the 27 closed investigations into Glenn Defense. But they acknowledged that they were slow to recognize the scale of the fraud and the extent to which the Navy had been corrupted. Francis has admitted in court to bribing “scores” of Navy officials, only some of whom have been publicly identified.
“In hindsight, maybe we could have dug a little deeper than we did,” John A. Hogan, NCIS’s executive assistant director for criminal operations, said in an interview. But he said the fact that the agency opened so many investigations into Glenn Defense shows that it was taking allegations against the firm seriously.
Hogan said other factors hobbled NCIS. After the Sept. 11, 2001, attacks, for instance, most NCIS agents who specialized in financial crimes were reassigned to the counterterrorism division.
Navy Secretary Ray Mabus said that the service was vulnerable to contracting fraud when he first took office in 2009 and that NCIS should have recognized earlier that there was a pattern of trouble with Glenn Defense.
“I’m not going to defend at all opening and closing 27 cases,” Mabus said in an interview. “Something should have raised a red flag along there somewhere.”
A former state auditor in Mississippi, Mabus said he pushed the Navy to adopt stricter internal accounting controls and other “tripwires” to detect signs of fraud. He said that the Navy moved more aggressively to investigate Glenn Defense starting in 2010 but that it took three more years to arrest Francis because he had bought off so many Navy officials.
“Francis had established a pretty good network, including a lot of Department of Navy personnel, who were able to explain away these allegations,” he said. “There were people inside the Navy who were trying to shut this down, who were coming up with reasons not to pursue it.”
Federal court records show that Francis methodically cultivated a network of paid Navy informants over many years and planted them throughout the bureaucracy. He had spies inside the Navy’s regional contracting office in Singapore, the U.S. Embassy in Manila and the wardroom of the USS Blue Ridge, a command ship that serves as the flagship for the Navy’s 7th Fleet and the hub for maritime operations in Asia.
In exchange for paid sex with prostitutes, cash and luxury vacations, Francis’s informants fed him a near-daily diet of classified material and inside information that enabled him to keep gouging the Navy and outfox his pursuers for years, according to court records.
Francis’s most valuable mole was John Beliveau II, a turncoat NCIS supervisor who received a 12-year prison sentence in October. At the sentencing hearing, Assistant U.S. Attorney Brian R. Young marveled at the extent to which Francis had corrupted NCIS and compared him to an infamous Massachusetts mobster.
“We tried to come up with an example of . . . another instance in which a criminal enterprise so thoroughly penetrated a federal law enforcement agency,” Young said. “You would have to look back to the 1980s when Whitey Bulger’s Winter Hill Gang penetrated the Boston FBI.”
An examination of NCIS case files shows a clear pattern in which the law enforcement agency was quick to dismiss complaints about brazen cheating by Glenn Defense.
In June 2006, a Navy officer in Hong Kong told NCIS that Glenn Defense had overcharged the Navy $68,000 to pump sewage from the aircraft carrier USS Ronald Reagan during a three-day port visit. The officer reported that the Reagan’s supply officers knew the sewage invoice had been falsified but approved it as part of an unorthodox arrangement to repay an old debt to Glenn Defense from a prior port call.
An NCIS agent based in Japan obtained the invoices and verified the allegations after a five-day investigation. But rather than pursue it further, the agent closed the case and wrote a note saying that the findings would be referred to the Reagan’s commanding officer, according to NCIS files.
In an interview with The Post, the officer who flagged the fraudulent sewage bill said he was stunned that NCIS let the case drop.
“What else could I have done to expose this racket?” said David Schaus, who has since left the military. Others in the Navy, he added, “made my life hell” after they learned he had tried to blow the whistle on Glenn Defense.
The Reagan’s commander, then-Capt. Terry B. Kraft, was acquainted with Francis. Navy records show Glenn Defense had treated Kraft and other senior officers to an “extravagant” dinner in Hong Kong during the 2006 port visit, as well as pricey meals elsewhere in Asia.
Kraft climbed the ranks to become a two-star admiral but was censured last year along with two other flag officers and forced to retire after the Navy discovered he had not fully reimbursed Francis for the meals. Kraft has said the censure was unfair and that a superior officer had directed him to attend the meals with Francis.
In an email to The Post, Kraft said he was unaware of the Hong Kong sewage-removal dispute and that he “was never approached by NCIS or anyone else about any possible overbilling.” In fact, he said, he had complained to his entire chain of command about high port costs during the Reagan’s deployment to Asia that year, to no effect.
Other allegations about Glenn Defense rolled into NCIS offices in Asia on a steady basis, according to the law enforcement case files.
In 2007, the naval inspector general in Washington forwarded a document asserting that the defense contractor was grossly overcharging the Navy to provide port security. It is unclear from the case file whether NCIS agents followed up.
“Everybody knew that