Navy sex and bribery scandal widens

An attorney for Admiral Loveless declined to comment

(CNN) – A grand jury indictment is shedding new light on a bribery and sex scandal allegedly involving senior U.S. navy officers and a defense contractor known as “Fat Leonard.”

The Seventh fleet is the Navy’s largest. Its motto: ‘ready power for peace’. But according to a new indictment, some of the fleet’s commanders were also ready for parties and prostitutes.

Prosecutors say retired Rear-Admiral Bruce Loveless and eight other officers accepted luxury travel, expensive dinners and prostitutes. In return, they gave a civilian contractor classified information about their ships’ movements.

Kirk Lippold, now-retired former Commander of the USS Cole, says, “This is beyond the pale. When you look at the ranks and the level of officers that are involved in this scandal, it is something the Navy has not dealt with literally in decades.”

According to the indictment just un-sealed, when some of the officers docked in Manila in 2007, they went to a party at the MacArthur suite in the Manila Hotel. It also reads, “During the party, historical memorabilia related to General Douglas MacArthur were used by the participants in sexual acts.”

Lippold says, “Totally disgusting. There is absolutely– when you look at that, that is the history of the United States of America. And to take those artifacts and embarrass General MacArthur and his family in that manner… being used in what is purported to be those sexual acts, it’s just, be- I, I – there’s no words that can describe it.”

The contractor who allegedly supplied the lavish gifts and parties was Leonard Glenn Francis, also known as “Fat Leonard”. A wealthy, flamboyant executive who ran a marine contracting agency which provided dockside services to U.S. navy ships.

“Fat Leonard” Francis has pleaded guilty in the case, and is awaiting sentencing. But until now, many of the details of what happened were not public.

In May 2008, according to prosecutors, Francis allegedly paid for Admiral Loveless and five other navy men to stay at the Shangri-La hotel in Manila. In the indictment, prosecutors write: “Francis hosted a raging multi-day party, with a rotating carousel of prostitutes in attendance, during which the conspirators drank all of the Dom Perignon available at the Shangri-La”… to the tune of more than $50-thousand.

For some officers, in 2006, there was a dinner in Singapore – with a “foi gras terrine”, “duck leg confit”, “roasted Chilean sea bass” – followed by expensive drinks and “Cohiba cigars — $2,000 per box.”

Prosecutors say in return, the officers helped steer Navy ships to ports operated by Francis – where he overbilled the Navy, tens of millions of dollars.

Experts say Admiral Loveless – who was a top intelligence officer – and the others charged, took massive risks that could have exposed American secrets.

Former Army JAG officer John Altenburg says, “They’re susceptible to being blackmailed by foreign intelligence agencies, by other corporations, by this person himself, who they’ve been involved with.”

An attorney for Admiral Loveless said neither he, nor his client, would comment.

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