Retired Lieutenant Commander Pleads Guilty in Navy Bribery Scandal

Edmond Aruffo admitted to his role in a widespread conspiracy to overcharge the U.S. Navy for services of ships in the Pacific Ocean

By R. Stickney
|  Monday, Jul 7, 2014  |  Updated 11:37 AM PDT
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    A retired U.S. Navy Lieutenant Commander has admitted to his role in the overcharging of the U.S. Navy by up to $2.5 million in a widespread international bribery scandal.

    Edmond A. Aruffo, 45, is the seventh defendant charged and the fourth to plead guilty in a conspiracy to overcharge the U.S. government millions of dollars in services for Navy ships in the Pacific.

    Federal prosecutors allege that CEO of Glenn Defense Marine Asia (GDMA) Leonard Francis, known as “Fat Leonard” by Navy officials, offered Navy officials cash, luxury travel, electronic gadgets and prostitutes in exchange for confidential information on ship movements.

    Francis along with his cousin, Alex Wisidigama, overcharged the Navy for more than $20 million in services, prosecutors claim.

    Aruffo pleaded guilty to a conspiracy charge in federal court Thursday in San Diego.

    He was serving as Operations Officer of USS Blue Ridge when he first met Francis, according to court documents.

    He accepted a job with Singapore-based Glenn Defense Marine Asia (GDMA) in April 2009 and used using letterhead from several Japanese vendors to prepare inflated invoices to the U.S. Navy.

    Once the U.S. paid the invoices, the vendors would send kickbacks to GDMA, according to details released last week in a plea agreement.

    The 20-year military veteran said he used those kickbacks to take Navy officials on lavish dinners.
    Aruffo did not post the $40,000 bond. He will be sentenced October 3 before U.S. District Judge Janis L. Sammartino.

    Those charged in the investigation include Commander Michael Vannak Khem Misiewicz, Commander Jose Luis Sanchez, Naval Criminal Investigative Service Special Agent John Beliveau and U.S. Navy Petty Officer First Class Dan Layug.

    Layug, 27, pleaded guilty in May to accepting bribes in exchange for providing classified information. He will be sentenced September 2.

    In March, Wisidigama pleaded guilty to conspiracy to defraud the U.S. government.

    Beliveau accepted terms of a plea agreement in December 2013.

    Francis has denied wrongdoing in the case. He's in federal custody awaiting trial.

    The plea agreement in Aruffo's case outlines the kickback scheme.

    For example, the invoice for USS Lake Erie’s visit to Sukomo, Japan in February of 2010 charged the U.S. $145,229.77 – an amount inflated by about $50,000, which the vendor ultimately gave to GDMA as a kickback, prosecutors said.

    Soon after, USS Blue Ridge arrived to Otaru, Japan. Court documents show Aruffo arranged the husbandry services from a Japanese vendor that cost the Navy $432,476.14. Prosecutors say $204,961.20 was kicked back to GDMA.

    Prosecutors said the conspiracy involved almost every U.S. Navy ship that came to port in Japan from July 2009 to September 2010 including USS Lake Erie, uss Blue Ridge USCGC Jarvis, USS John McCain, USS Stethem; USS Cowpens; USS Pinckney; USS Rentz; USS Mount Rushmore; USS Mustin; USS Fitzgerald; USS Curtis Wilbur; uss Guardian; USS Russell; USS Vandegrift; USS Denver; USS Defender; USS Shiloh; and USS Momsen.

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