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« Elisabeth Danon on the globalization of deferred prosecution agreements | Main | Andy Spalding: Five lessons I’ve learned at IACA »
Wednesday
May102017

Two Singaporeans plead guilty in Fat Leonard scandal

Two Singaporean executives of Glenn Defense Marine Asia pleaded guilty in federal court Tuesday for submitting bogus bids, phony claims, and inflated invoices to the U.S. Navy.

Neil Peterson, 39, and Linda Raja, 44, were arrested by authorities in Singapore at the request of the U.S. government and extradited in October 2016.

Each pleaded guilty to one count of conspiracy to defraud the United States.

Sentencing for Peterson and Raja is set for August 11 in San Diego.
 
At Singapore-based Glenn Defense Marine Asia or GDMA, Peterson served as the Vice President for Global Operations.

Raja was General Manager for Singapore, Australia and the Pacific Isles.

They admitted conspiring with GDMA's owner, Leonard Glenn Francis, to defraud the U.S. Navy.

Francis, 51 -- also known as Fat Leonard -- is a Malaysian national. He pleaded guilty in U.S. federal court to bribing dozens of Navy officials with travel, meals, cash, electronics, parties, and prostitutes. He's waiting to be sentenced.

His company provided port services to U.S. Navy ships in Asia.
 
Peterson and Raja helped GDMA submit bids to the Navy that were either "entirely or partially fictitious."

The DOJ said the phony bids . . .

. . . ensured that GDMA’s quote would be selected by the U.S. Navy as the supposed lowest bidder. As a result, GDMA could control and inflate the prices charged to the U.S. Navy without engaging in any competitive bidding, as required.

Once GDMA won work from the Navy, Peterson and Raja inflated GDMA's invoices. In one case in October 2012, Peterson and others marked up invoices for services GDMA provided to during the U.S.S. Bonhomme Richard’s visit to Kota Kinabalu, Malaysia.

"The full amount billed to the U.S. Navy for this visit was $1,232,858, of which approximately $877,413 was fraudulently inflated," the DOJ said.

Overall losses to the Navy were more than $34.8 million.

So far the DOJ has charged 20 current or former U.S. Navy officials with taking bribes from Fat Leonard and GDMA. The defendants allegedly accepted luxury travel and hotel stays, elaborate dinners, electronics, cash, and the services of prostitutes. In exchange, they allegedly gave Francis and his company classified and internal U.S. Navy information.

Fifteen defendants including Francis have already pleaded guilty. A half dozen have been sentenced to prison. Sentences range from 30 months to more than six years.

______

Richard L. Cassin is the publisher and editor of the FCPA Blog.

Reader Comments (1)

Every time FCPA has a post regarding this case, I have need to discuss with someone. I am continually amazed at the high level professionals who don't know of the case, or who have no idea of the depth or how far reaching this case is. Thank you for your continued coverage. Excellence.
May 10, 2017 | Unregistered CommenterTjones
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