Nine more officers, including an ex-admiral, are indicted in 'Fat Leonard' bribery scandal

Nine more officers, including a Navy admiral who was head of intelligence operations before retiring in October, were indicted Tuesday on conspiracy, bribery, obstruction of justice and other charges in the ongoing “Fat Leonard” scandal.

An indictment unsealed in federal court in San Diego accused the group of current and retired officers of receiving gifts from Leonard Glenn Francis beginning in 2006. In return Francis — who owned the ship-servicing company Glenn Defense Marine Asia and was known as “Fat Leonard” because of his size — got access to classified information such as ship schedules, as well as the services of the officers who used their position to steer Navy business to his company.

Among those indicted was Adm. Bruce Loveless, who was the Navy’s director of intelligence operations. He retired in October but had been under investigation for his role in the scandal for several years, at one time losing his access to classified material while the investigation continued.

Navy Capt. David Newland, former chief of staff to the commander of the 7th Fleet, the service’s largest fleet and the center of the bribery scheme, also was named in the indictment. The others were Navy Capt. Donald Hornbeck, Capt. James Dolan, Capt. David Lausman, Lt. Cmdr. Stephen Shedd, Cmdr. Mario Herrera, Chief Warrant Officer Robert Gorsuch and Marine Col. Enrico Deguzman.

Loveless was arrested Tuesday by federal agents at a penthouse apartment in Coronado and made an appearance — clad in white jailhouse overalls and ankle shackles — in a federal courtroom in downtown San Diego.

U.S. Magistrate Judge Mitchell Dembin entered a not guilty plea on his behalf, and ordered that Loveless could be released on his own recognizance and not have to post a bond. Loveless said little during the brief hearing.

Francis has pleaded guilty to orchestrating the scheme that overbilled the Navy by at least $20 million.

For more than a decade, the contractor bribed Navy officials in the 7th Fleet to use their influence to steer ships to ports that his Singapore company controlled. Once they were there, he systematically overbilled the service for fuel, water, transport and many other services.

The Fat Leonard scandal has now ensnared 25 people, including 20 Navy officers and enlisted men as well as employees of Glenn Defense Marine Asia.

Moran writes for the San Diego Union-Tribune

greg.moran@sduniontribune.com

Twitter: @gregmoran


UPDATES:

6:15 p.m.: This article was updated with details of Loveless’ court appearance.

This article was originally published at 2:55 p.m.

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