Petty Officer Imprisoned in Navy Bribery Scandal

Navy Petty Officer Dan Layug accepted bribes in exchange for providing classified information

U.S. Navy Petty Officer First Class Dan Layug was sentenced Thursday to more than two years in prison for accepting cash, travel and a "bucket list" of video games and gadgets from a foreign defense contractor in exchange for providing classified information.

Layug faced a maximum sentence of five years in prison for his role in a widespread bribery ring involving U.S. naval officers and executives with a Signapore-based company that provided logistics services to the Navy.

U.S. District Judge Janis Sammartino sentenced the naval officer to 27 months in prison, telling him his crime put the Navy and the country at risk. He also ordered Layug to pay $15,000 in restitution to the Navy.

According to a federal officer in court, Rear Admiral Jonathan A. Yuen, the head of the supply systems command, spoke at the sentencing about the impact of this offense.

The admiral said the defendant betrayed the Navy, and the wider corruption scandal he was a part of caused widespread changes in how the supply part of the Navy operates. Those changes were ordered by Navy Secretary Ray Mabus.

Federal prosecutors allege that Leonard Francis, owner and CEO of Glenn Defense Marine Asia (GDMA) and his cousin, Alex Wisidigama, overcharged the Navy for more than $20 million in services.

They claim GDMA enlisted Navy personnel to send the company classified ship schedules.

Layug was assigned to the U.S. Navy Fleet Logistics Center in Japan.

He pleaded guilty in May 2014 to one count of conspiracy to commit bribery after admitting that he sent a "bucket list" to the contractor and accepted a $1,000 a month allowance, plus luxury hotel stays for himself and others in Malaysia, Singapore, Indonesia, Hong Kong and Thailand.

Among the items he asked for, and received, were an iPad 3, a Nikon digital camera, a Blackberry, a VAIO computer, a PSP gaming unit and a Wii gaming unit, prosecutors said.

“Layug essentially sold his honor for an iPad 3, and in doing so he put the U.S. Navy at risk of embarrassment, exploitation, attack or worse," U.S. Attorney Laura Duffy said in a written release.

Francis, known as "Fat Leonard," pleaded guilty to federal charges of bribery and conspiracy to commit bribery.

Francis and his co-conspirators exchanged luxury travel, prostitutes, lavish meals, top-shelf alcohol, designer handbags, fountain pens, Kobe beef, Spanish suckling pigs and Cuban cigars for ship assignments and other confidential military information.

Navy Capt. Daniel Dusek admitted to one count of conspiracy of bribery after he was relieved of command on USS Bonhomme Richard.

U.S. Navy Cmdr. Jose Luis Sanchez accepted a plea deal, in which he said he accepted $100,000 cash, entertainment, travel and prostitutes from Francis for proprietary Navy information.

Retired Navy Lt. Cmdr. Edmond A. Aruffo admitted to his role in the scandal in July 2014. He said he worked for GDMA and used letterhead from several Japanese vendors to send the Navy inflated invoices.

Alex Wisidagama, a GDMA company manager and Francis’ cousin, admitted in court to conspiracy to defraud the U.S. government.

Senior Navy criminal investigator John Beliveau II said he used his law enforcement training to help Francis avoid detection. Francis paid him with envelopes of cash and travel to Virginia, Singapore, Thailand and the Philippines.

Commander of Carrier Strike Group 7 on USS Ronald Reagan Rear Admiral Michael Miller received a letter of censure along with Rear Admiral Terry Kraft, who was commanding officer on the same ship, and Rear Admiral David Pimpo, who once served as supply officer of the aircraft carrier. The letter is seen as a career-ending development for the officers.

Navy lieutenant commander Todd Dale Malaki pleaded guilty to conspiracy to commit bribery after admitting to taking gifts from GDMA starting in 2006 with a deluxe room at the Grand Hyatt Singapore. He twice accepted envelopes with Singapore dollars equivalent to $1,500 and the services of a prostitute after visiting a karaoke club in Malaysia.

Paul Simpkins, a former contracting officer for the Navy and Navy commander Michael Vannak Khem Misiewicz, have pleaded not guilty to alleged involvement.

Navy investigators and attorneys with the Department of Justice have said there are more targets involved in the bribery ring.

Layug was ordered to surrender to the U.S. Bureau of Prisons on April 1.

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