Bad choices lead to serious consequences, especially when there is opportunity and a lack of checks and balances. Fraud can affect the smallest of businesses all of the way up to massive organizations. The same factors are always in play, all that is needed is for 
corruptible people to be tempted by the unethical.
The case of the massive Navy bribery scandal has already created a “first.” In June 2016, as the result of payoffs and bribes, Rear Admiral. Robert Gilbeau was the first admiral ever convicted of a federal crime while on active duty. He was sentenced to 18 months in prison.
It goes without saying that to reach the level of Admiral in the U.S. Navy requires dedication, skill, performance and just a bit of luck. Rear Admiral. Robert Gilbeau managed to destroy his career, but he was not alone. In total, 19 Navy officers, many of whom have already pled guilty, were caught up in the investigation. The officers were all high-ranking, as though no one ever talked to them about codes of conduct. The most recent developments in this case also netted civilians on conspiracy to defraud the U.S. Who knows the next people to be implicated?
Fat Albert
The fraud scandal goes back to 1997 and an unethical businessman by the name of “Fat” Leonard Francis. Francis saw the opportunity to steer business to his company, Glenn Defense Marine Asia. The company provides food, fuel, services and supplies to ships in the Port of Singapore and other Asian ports.
Francis reasoned that if he could bribe the right people in the U.S. Navy, he could convince the U.S. Naval personnel to use his facilities. In addition, he would find a way to have those naval officers give him confidential information on contracts out for bid so he could undercut the competition or out-bribe them. When he billed the Navy for his services, he would inflate the costs and make huge profits. All he needed was the admiral to go along with it.
Fat Albert started to wine and dine the admiral. He gave the admiral cash, visits to nightclubs, karaoke bars, restaurants, luxury hotels, and the use of prostitutes. From there, Mr. Francis extended his lavish parties, Rolex watch gifts and prostitutes to a group of Navy officers who had the ability to create paperwork to expedite the process of having Glenn Defense Marine Asia as the prime supplier.
The scheme worked. Francis was able to overbill the Navy by more than $35 million in pure profits, while the Admiral and his officers gave up their integrity and judgment for trinkets and sex. As they sit in jail, or await jail I wonder if they still think it is worth it to throw away a career to have a few hours of pleasure in a brothel or drink expensive champagne?
Latest Developments
As the investigation widened, the scandal crossed over from the armed services to civilian life. Two employees of the company, Neil Peterson and Linda Raja entered guilty pleas Tuesday to conspiracy to defraud the U.S. They too were caught up in the web that Leonard Francis created. They processed the inflated invoices, sent them to the admiral’s office for approval and undoubtedly helped secure gifts and other favors for the officers.
We now come to the biggest ethical outrage of all. The scandal, began in 1997 and continued like clockwork until 2013. Officers came and went, ships arrived and left, and the parties and good times continued unabated. Investigators have potentially uncovered more than 20 other admirals who may have also been involved and they are all awaiting hearings and trials.
The ethical implications of this massive case of fraud are as large as the destroyers and the carriers themselves. The military is unlike civilian life. Even a higher-ranking officer would be afraid to challenge an admiral without careful thought. It indicates that underneath the admirals there may be hundreds of other officers to went along with it because they were afraid to be whistle blowers.
The biggest irony of all is that “Fat” Leonard Francis is singing like a canary. He is cooperating with authorities and for all we know, he may simply walk away in exchange for his cooperation. He is beyond ethics and beyond any codes of conduct. As he walks, with little in the way of lasting consequences, the reputations of good men and women will be tainted with their country, the Navy, their families and friends.
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