Fat Leonard’s Crimes on the High Seas

The rise and fall of the defense contractor who bought off Navy brass with meals, liquor, women and bribes

The Naval brass were already waiting when Leonard Glenn Francis pulled up to the security gate of the San Diego base and flashed his ID. Off in the distance, massive steel-gray destroyers towered in the harbor, above the palm trees and squat, cream-colored barracks. In a military that now outsources many of its functions to the private sector, Francis specialized in servicing ships, specifically the Navy’s 7th Fleet in the Pacific, the largest forward command in the world. When a ship or submarine came ashore for a port visit, Francis’ firm, Glenn Marine Defense Asia, could provide whatever the crew might need: barges that emptied hundreds of gallons of sewage, divers that scanned the harbor for explosives, vans that took sailors into town to get drunk. “He was actually just really good,” says a retired captain who once commanded a 7th Fleet submarine. “There were others. But Glenn Defense was the best.” Around Singapore, where Francis kept his headquarters, he drove around in bulletproof Hummers, wore Armani silk suits and Gucci calf-skinned loafers. But on official business with the Navy, he just as often wore American flag neckties, his ringtone programmed to Lee Greenwood’s “God Bless the U.S.A.” He was 6 foot 3, and weighed nearly 350 pounds – with his stomach stapled. Behind his back, the officers called him Fat Leonard.

When Francis started contracting with the Navy over 25 years earlier, he faced over a dozen competitors; now, he held claim to nearly the entire Pacific, a region spanning 48 million square miles, with a Naval presence of some 70 ships and 20,000 personnel. Glenn Defense held $250 million in contracts. Francis was meeting with the officials in San Diego to drum up even more business. What he didn’t know is that for two years, a secret team of agents from the Naval Criminal investigative Service (NCIS), the branch’s law enforcement arm, had been monitoring Glenn Defense, gathering evidence of falsified invoices, bribery and fraud.

NCIS investigators estimated Francis had stolen $35 million from the Navy over the past two decades, relying on a network of paid informants within the Navy to secure contracts, prod aircraft carriers to more lucrative “pearl ports” and undercut the competition. He had spies in the contracting office in Singapore, the embassy in Manila and the wardroom of the USS Blue Ridge, the 7th Fleet’s flagship. His network of moles had fed him military secrets and classified information, compromising national security in what prosecutors and other officials call the worst breach since the Cold War.

Francis accomplished all of this with at least $500,000 in bribes to officers, wiring money to hidden accounts or with envelopes of cash delivered in hotel bars, along with hundreds of thousands of dollars paid in meals, women, alcohol and entertainment. He had pictures and videos of the Navy’s best and brightest partying with high-end escorts, and notes on the proclivities of individual members: who preferred Vietnamese twins, group sex or BDSM. He took decorated officers to multi-course dinners, dropping tens of thousands of dollars on their meals; he hosted one multi-day sex party at a five-star Manila penthouse where, court records show, officers were serviced by “a rotating carousel of prostitutes” and drank the hotel out of Dom Perignon, running up an alcohol bill of $50,000.

NCIS had opened 27 investigations of Glenn Defense beginning in 2006, but according to the Washington Post, each case was closed, often due to pressure from officers at the top. Investigators discovered that Francis had a mole at the NCIS headquarters in Quantico as well, an agent he flipped to leak the names of cooperating witnesses. This time, to cover their tracks, agents had planted a bogus report in the Fat Leonard file, stating that several key investigations into Glenn Defense were closed. Meanwhile, a small team of federal prosecutors and NCIS agents had secretly devised an international sting operation.

They had discussed luring Francis aboard a U.S. warship for a meeting and arresting him there. Years before, they’d nabbed a leader of the Arrellano-Felix drug cartel on a fishing boat in international waters off the coast of Mexico, so there was some precedent. But this was different: they’d have to steam 9,000 miles across the Pacific just to get to San Diego for an arraignment. Requesting extradition from Singapore would also be difficult, considering Francis’ connections and resources; it might take years to get him to the U.S. Ultimately, they had decided to lure Francis to this meeting in San Diego, ostensibly to discuss the rise of China and Francis’ role in the Obama administration’s “Asia pivot.” Afterwards, Francis drove to another part of the harbor and checked into a Marriott. That night, NCIS agents raided his room and arrested him.

In December of 2015, the Navy summoned 200 admirals to a secret meeting in Washington, and revealed that thirty of them were under criminal investigation. The scandal would eventually reveal pervasive corruption within the Navy’s contracting process, a deeply dysfunctional system of oversight and a years-long cover up. Every level of the Navy appeared to be implicated in one way or another. There were pictures of Francis with Admiral Mike Mullen, the former chairman of the joint chiefs of staff, and Admiral Jon Greenert, the highest-ranking officer in the Navy (Neither has been implicated in the case). “I think this thing goes way back, decades,” says one Navy officer. “If you gave these guys truth serum you’d find people accepting lavish dinners and going to events that certainly exceeded the scope of what they were allowed to do ethically. I think it goes to the highest levels.”

Ted Branch, a three star admiral who retired last year as director of Naval intelligence, was under investigation until earlier this year (Branch has been cleared of wrongdoing). Other high ranking Naval officers have come under scrutiny for their contacts with Francis, but have not been charged, including Robert Willard, the four star commander of all U.S. military forces in the Pacific and John Donnelly, a former three star admiral and one-time commander of the Navy’s entire submarine fleet. “This is about the system itself,” says a retired captain who knew Francis. “This isn’t about just some rogue individuals. This is an institutional problem, and they’ll do what they can to protect the institution.”

Thus far, the Justice Department has filed criminal charges against 30 people, according to a recent report in the Washington Post, an additional 480 active-duty or retired personnel are under investigation, including about 60 current and former admirals. Francis’ sentencing has already been rescheduled four times, likely because he continues to provide the U.S. Attorney’s office with new names. “There have been other contractors who have got away with much bigger fraud,” says Charles Tiefer, a University of Baltimore law professor who sat on the Commission on Wartime Contracting in Iraq and Afghanistan. “But in terms of someone infiltrating the military, and corrupting so many officers, we’ve never seen anything like it.”

Francis, the son of a Portugese father and Sri Lankan mother, came of age in the Malaysian state of Penang along the Strait of Malacca, the busiest shipping channel in the world. His grandfather had started a ship service business after World War II, which his father and uncle would come to run as well. Francis – a mama’s boy and the product of Penang’s private schools –was destined to run the firm, but in 1986, he got into an early bit of trouble with the law. He had opened a pub “frequented by undesirable characters,” according to court records, and was arrested after police found two Smith and Wesson revolvers and a bulletproof vest in his bedroom. Malaysia’s strict gun laws demanded six lashes with a cane and 18 months of prison time. When he got out, he began working with his father. By the early ’90s, he had taken over the firm, Glenn Marine.

With the Cold War winding down, the Pentagon began re-thinking a Pacific presence that had existed since World War II. In 1992, under pressure from the Philippine government, the U.S. shut down the Subic Bay navy base, a sprawling 60,000-acre facility capable of housing 40,000 troops and staff members. By the end of the year, the U.S. closed its major bases in the Philippines, the biggest reduction of U.S. military forces ever in the western Pacific.

At the same time, a team of reformers in the Clinton Administration was pushing for a “reinvention of government,” an era of free market concepts – eliminating red tape, slashing the federal workforce and outsourcing as much as possible to the private sector – ushered in by a Democratic administration friendly to big business. The trend only accelerated under George W. Bush. During World War II, the military employed one contractor for every seven soldiers; by 2009, the ratio was one-to-one in Iraq and three-to-one in Afghanistan. “The extent to which we began to rely on contractors was unprecedented,” says Janine Wedel, an anthropologist at George Mason University and author of Shadow Elite, a book that looks at the intersection of the free market and government. “The line between what the government did and what contractors did became incredibly blurred.”

After 9/11 the money flowing to private defense contractors skyrocketed 15 percent each year, from $284 billion in 2000 to $452 billion by 2008. In Afghanistan, private contractors carried around suitcases stuffed with cash to buy off warlords and build roads over rugged mountain passes. When Obama was elected, spending on defense contractors slowed, but not in the Pacific Command, where the administration continued to deploy ship to fend off China’s rise. By then, Francis had already started spending time with Navy brass, visiting ships that came into port, and taking captains out to dinner. He wanted to understand Navy strategy – and how he could he help.

In terms of realpolitik, navies are different than armies. A fleet of ships could do things an infantry unit could not, like provide a substantial military presence 10,000 miles off the mainland. A ship off your coast may send a signal, but it wasn’t the same as a full-scale invasion. And because it took ships so long to get anywhere, they were less threatening than actual troops on the ground, which allowed diplomats time to ratchet up pressure during a crisis. Francis had seen that dynamic play out in the early 90s when two aircraft carrier strike groups were sent near the Taiwan Strait in response to a Chinese missile test.

Port visits, Francis realized, were an instrumental part of military strategy. It was mostly about “raising the flag,” a projection of soft power, which kept sea lanes open for commerce and kept adversaries—like China, North Korea and Russia—in check. Francis looked over the entire region. There were dozens of contracts, with hundreds of millions of dollars up for grabs.

In early 2006, Francis showed up at a hotel bar in Singapore carrying an envelope stuffed with $50,000 in cash. He was meeting Paul Simpkins, a decorated Air Force veteran who ran the Navy’s contracting office in Singapore as a civilian specialist. Simpkins and Francis had been meeting for weeks, finalizing the details of a backroom deal that would gross millions of dollars for Glenn Defense. In exchange for regular cash payments, Simpkins would help Francis land lucrative contracts in the Pacific (one in Thailand proved to be worth $7 million), serve as a source of classified Naval intelligence and shield Francis from disputes over billing or the bidding process. Francis would essentially have someone inside the Navy working for Glenn Defense. He slipped Simpkins the envelope of cash. All told, Francis would transfer over $400,000 to accounts Simpkins controlled, often emailing money wire details to Simpkins’ wife in Japan, and regularly sent gifts to Simpkins’ mistress, a scientist in China.

Contracts, though, were only profitable if the Navy came to a port Francis controlled. Francis also needed influence over the decision makers, known as the line officers, the guys of 0-6 rank and above who ran the ships. He needed operations, logistics and the N7 chiefs, which drove port visit decisions based on strategic objectives. And so Francis started wining and dining the 7th Fleet Staff, which oversaw all the ships in the region. “The reality is 7th fleet has always been the wild, wild west for the Navy,” says a retired captain. “It’s like the prime liberty. Anything you want to do, anything you want to get, you can get at 7th Fleet. The Navy doesn’t want to project that image, but sailors want to go to Thailand and the Philippines because of what’s offered there. Francis understood that.”

Not long after getting the Thailand contract, the 7th Fleet’s flagship, the USS Blue Ridge, pulled into Singapore. That night, Francis took David Newland, the 7th Fleet chief of staff, and two other high-ranking officers to a restaurant called Jaan, where they sipped cocktails on the roof’s helipad, and later enjoyed a meal of foie gras and duck-leg confit with a $2,000 bottle of Hennessy cognac. “Every contractor will try to exploit the rules, Francis wasn’t special,” says a retired captain. “They’ll offer you a dinner, offer you a hotel room, even in the United States. But the rules on this stuff are very clear: anything over $50 you have to report. They were clearly crossing the line and these guys knew it.”

Shortly after Francis took Newland out to another meal, he sent the naval commander an email, asking why the escort ships accompanying the USS Abraham Lincoln, an aircraft carrier, were headed to a different port. “Could you kindly check with your staff if we can make the right decision?” Newland replied that he’d make sure the ships would be sent to Francis’ desired port. Five days later, on April 10, 2006, Newland wrote Francis, “Just got official word. Everybody is approved. Congrats.” A week later, USS Abraham Lincoln and three escort ships docked at a Glenn Defense port – the contractor billed the Navy $1.9 million for the seven-day visit.

Francis became the “the ultimate insider,” says one former officer who knew him, and says he came to understand Navy strategy and 7th fleet operations so well he knew exactly who to pinpoint to get the information he needed. “As time passed he became greedier and more emboldened by his power given every facet of the Navy he infiltrated,” says the officer. Francis often leaned on Newland, who helped squash a rival contractor’s bid for three port visits to the Philippines in January 2007.

The following month, Newland, and four other 7th Fleet executive officers, attended a party Francis hosted at the Manila Hotel’s General Douglas MacArthur suite, a 2,000-square-foot penthouse overlooking Manila Bay. According to a federal indictment, Newland and other officers participated in a bacchanal that night, using historical memorabilia belonging to General MacArthur for sex acts. (That the suite houses a replica of MacArthur’s corncob pipe, inscribed with the words “I shall return,” became the butt of at least one late-night joke.)

Francis expanded the scope of his influence to include the entire leadership of the 7th Fleet – the chiefs of staff over intel, logistics and operations (two of whom would eventually rise to the rank of admiral). He studied key players, probing for vulnerabilities. Mario Herrera, for example, was the fleet operations and schedules officer, instrumental in leaking ship schedules to Glenn Defense. Herrera’s nickname was Choke because he allegedly liked to choke hookers during sex.

In emails, members of the 7th Fleet who worked with Francis talked openly of their participation in the conspiracy, referring to each other as members of the Brotherhood or the Wolf Pack. When they were shipped to other assignments, those who remained worked with Francis to vet new members into the conspiracy. In August of 2007, Robert Gorsuch, the 7th Fleet’s flag administration officer, emailed Francis, addressing him as boss. He was getting together with another member of the Brotherhood to work up personality profiles of the incoming command for the Blue Ridge, writing Francis, “We will come up with a plan and give you an update shortly.” By the end of the year, Francis added Dave “Too Tall” Lausman, the new commanding officer of the Blue Ridge, to the Brotherhood, along with Capt. Bruce Loveless, the 7th Fleet’s top intelligence officer (Loveless would eventually rise to the rank of admiral).

Over the next three years, the 7TH Fleet staff leadership provided Francis classified ship schedules, used their influence to send aircraft carriers and destroyers to ports he preferred, and wrote fawning letters (known as Bravo Zulu letters) that would help Glenn Defense gin up business in the future. In 2011, Francis was awarded contracts for the entire region, other than India. The contracts were worth $200 million. He had become the only game in the Pacific.

In Singapore, Francis had assumed the role of a playboy tycoon. But publicly, he portrayed himself as a devout Roman Catholic who took care of the staff that tended his homes and gardens. A local newspaper reported that during Christmas he spent $100,000 decorations like fake snow, an extravagant light show, and a robotic Rudolf the Red Nosed reindeer at his 70,000 square foot estate on Nassim Road. He had another 28,000 square foot home with a pool on the roof in the outskirts of Kuala Lumpur. He doted on his mother and told a sailor he dined with that nothing mattered more than family. “From that perspective, he was a good man,” one sailor recalls. “However, it was clear he was morally bankrupt when it came to his wives/girlfriends.”

Francis had refurbished a decommissioned British gunner and re-christened it the Braveheart – a giant party boat for US officers, where his pole dancers, known as Elite Thai SEAL Team, performed live sex shows while sailors ate Kobe beef and drank expensive cognac. Mike Seaman, a retired chief petty officer who served on the USS Blue Ridge, told the Washington Post about another party in 2010 in Jakarta under a big-top tent on the bow of a warship. As an enlisted sailor, Seaman wasn’t invited to the party, but stood on the pier, watching guests arrive. Francis appeared in a black stretch Hummer limousine. “About a dozen beautiful Asian women got out, and there were no dudes, other than Fat Leonard and maybe one of his guys,” Seaman told the Post. “It was kind of weird to see the dude roll up with some badass chicks. They weren’t bottom-shelf tuna. They were real good-looking women.”

Francis had an angry streak as well. When he got drunk he liked to smash champagne flutes to bits and chew on the shards of glass until his gums bled. He’d once told a water taxi inspector who filed a negative report that if he ever returned to Singapore, he’d have him killed. “I was told he had powerful friends and not to tussle with him,” a former supply officer recalls. “I had no idea what the hell it meant. I was like, ‘What is this guy some kind of fucking gangster? Is he going to kneecap me or something?'”

Francis’ rise came not only in an era of increased reliance on contractors, but one of lax oversight. The Defense Contract Audit Agency, tasked with monitoring contracts across the military, was consistently understaffed, says one former officer. Similarly, NCIS did not have anyone in place to spot sophisticated financial crime. Prior to Sept. 11, 2001, the agency had a robust economic crimes division, with 140 dedicated special agents. But since then, the division had been cut to nine people; at times, none of them investigated economic crimes in the Pacific (in 2008, only one agent was assigned to the NCIS Far East Field Office in Yokosuka).

According to hundreds of pages of previously classified information obtained by Rolling Stone, between 2004 and 2012, NCIS produced 10 criminal intelligence reports on Glenn Defense and opened 14 investigations. The complaints ranged from Glenn Defense influencing the Indonesian military against a competing contractor, to repeated allegations of inflated invoices. Per Navy regulations, some prices on the contract were fixed, but other line items – like trash removal and the price of fuel – were not. For these types of charges, Francis was required to get three bids from subcontractors, and choose the cheapest one. But without anyone looking over his shoulder, he routinely invented ghost subcontractors, copied letterhead from other firms, and wrote up phony invoices in order to gouge the Navy.

Still, from the beginning, there were people within the Navy suspicious of his methods. While the U.S. Attorney’s Office alleges that Francis began bribing Navy officers as early as 1997, the first registered complaint in NCIS files came in 2006. That summer, Francis arrived at the Ship Support Office in Hong Kong to go over a new contract with a stocky, ruddy-faced sailor named Dave Schaus, a former navigator on a guided missile destroyer, the USS Gonzalez. Francis apologized for being late. He had planned to charter a plane from Singapore, he explained, but none were available and so had to book a first class flight at the last minute. Schaus was impressed – Francis seemed like a successful entrepreneur whose interests aligned with the U.S. military. The meeting lasted over three hours, Schaus recalls, and nothing seemed amiss as they went over every item on the 100-page contract.

But a few weeks later when Francis returned to get paid, Schaus noticed something odd on the invoice. Glenn Defense was charging the Navy for the removal of 100,000 gallons of sewage, but Schaus knew the ship could only carry 12,000 gallons, meaning that unless Glenn Defense had emptied its tanks several times a day, the invoices were inflated. “Hey, this doesn’t make sense,” Schaus said pointing out the fee for sewage removal. “This is not possible.”

Francis quickly became irate. “Are you calling me a liar?” he thundered, pounding the desk.

“I guess I am,” Schaus said.

His subsequent complaint to NCIS went nowhere. The Hong Kong support office, it turned out, was connected to Paul Simpkins, the contracting agent in Singapore who Francis had bought off. “Do not request any invoices from the ship,” Simpkins ordered in an email.

Schaus was stunned. “Up until that time my perception was the Navy was spic and span, black and white, do the right thing and you’ll get rewarded,” Schaus says. “I had never seen anything like this.”

Schaus eventually filed multiple complaints against Glenn Defense. In retribution, he says, Francis influenced superiors to give him poor performance reports. “Anyone who tried to tangle with Leonard Francis immediately started getting all these phone calls from the captains,” Shaus says. “‘Why are you accusing this guy and this and that? This is a good guy, this guy is working with the Navy.'” When Schaus finally left Hong Kong, he briefed his replacement on his suspicions about Glenn Defense.

Francis turned to the top supply officer on the Blue Ridge, Todd Malaki, asking for “dirty laundry” on personnel in the office, and asked Capt. James Dolan, assistant chief of staff for logistics on the Blue Ridge and a member of the Brotherhood, to shut down Schaus’ old office. In response, Dolan wrote a long email to the Rear Admiral Supply Officer of the Pacific Fleet, recommending they eliminate positions in Hong Kong. He forwarded the email to Francis, writing, “Who loves you, Brother?” When the admiral responded, saying he’d look into reduced staffing in Hong Kong, Dolan forwarded the response to Francis. “It’s now on his radar.” Schaus’ position was ultimately eliminated.

Mike Misiewicz first heard of Fat Leonard, in 1999, while Surface Warfare Officers School in Newport, Rhode Island. “If you want your ship and crews to be taken care of,” his instructor told him, “make sure you get in good with Leonard Francis.” Misiewicz had the sort of story recruitment videos are built around. He was born in Cambodia, around the time the Khmer Rouge was rising to power, and adopted by a woman from Illinois who was serving with the U.S. military in Phenom Penh. As a teenager in the Midwest, he worked on his adoptive relatives’ farm, played high school football and eventually graduated from the Naval Academy. He first met Francis when his ship made a port visit in Malaysia, in 2009. To Misiewicz, Francis seemed like a charismatic and friendly businessman, and very pro American. He knew nothing about the Wolf Pack, or their wild sex parties in the MacArthur suite, nor did he know that Francis was already working on a plan to ensnare him.

Francis had hired a former Navy officer named Ed Aruffo to run his Japan office. A working class kid from New York, Aruffo had enlisted in the Navy and eventually rose to the rank of lieutenant commander. After retiring from the Navy, he studied at Cambridge and took a job with Barclays. In April 2009, he began working for Glenn Defense in Japan. According to letters, Misiewicz’s wife got a bad feeling around Aruffo and told warned him to stay away. But Misewicz felt Aruffo was harmless, and maybe even a little lonely. He seemed interested in showing Misiewicz how great Japan was. He’d married a Japanese woman, lived in a wealthy community and sent his kids to private schools. “He just wanted to relive his Navy days,” Misiewicz wrote.

When Misiewicz was in Japan, Aruffo often asked him to dinner, sometimes with Francis in tow. Jose Sanchez, then the director of operations at the Naval Base in Yokosuka, often came along too. (Only later would Misiewicz realize Sanchez was on the take, and had been for years.) They typically started with dinner and then went to Francis’ favorite gentlemen’s club in Roppongi, the decadent Tokyo neighborhood frequented by drunk foreigners with deep pockets. Nights usually ended late, often at karaoke clubs where Francis, an Elvis impersonator in his younger years, took the mic to perform “Love Me Tender.” On one port visit to Singapore, Francis invited Misiewicz to eat brunch with his family. Misiewicz, a devout Christian, was impressed by how Francis seemed to care for his children, wife and mother. As a token of their friendship, he gave Misiewicz a coin engraved with the image of Jesus.

In January of 2011, Misiewicz became deputy chief of staff for the 7th Fleet aboard the USS Blue Ridge, a position that gave him significant influence over which ports the flagship visited. “Moving forward how is Mike doing and looking long range?” Francis asked Aruffo in an email. Aruffo replied that he and Mike had talked days before about some upcoming port visits, but didn’t reveal anything solid. “Mike has to be hungry and proactive,” Francis replied. “We gotta get him hooked on something.”

Francis paid to fly Misiewicz and his children to Cambodia, where he could visit family he hadn’t seen since fleeing the Khmer Rouge. When he wrote Francis to thank him for the Cambodia trip he attached classified schedules, including info on where the USS George Washington was headed. Aruffo was ecstatic. “We got him!!:).”

“You bet,” Francis replied, signing his email, “The Godfather.”

“All hail!” Aruffo responded.

In a letter to the judge during sentencing, Misiewicz said he felt awful that his actions could have potentially impacted national security. But he also reasoned that ship schedules could change at the last minute, forcing contractors like Glenn Defense to scramble from one port to another. He also rationalized that the schedules weren’t all that classified; families got them ahead of time, and often it seemed like Aruffo, who was constantly pressuring Misiewicz for more intel, already had much of the classified information. But by the beginning of 2012, his communications with Aruffo and Francis had become so routine that Misiewicz accidentally included Francis on an email to other Navy personnel. Francis warned Misiewicz to be more careful.

NCIS had already realized their previous investigations into Glenn Defense had been compromised. Somewhere, they had a turncoat agent, a mole feeding Francis info in real time. The agent was John Beliveau, who had met Francis in 2008, when he was stationed in Singapore as a “referent,” an agent responsible for meeting US ships when they came into port and briefing staff on security threats. He’d been singled out as the NCIS Agent of the Year in 2010 for combatting terrorism in Timor-Leste. Francis was an expert at manipulating the weaknesses of officers who came into his orbit, and Beliveau proved an easy mark. Suffering from PTSD, and self-medicating with heavy drinking, he had allegedly never had a romantic relationship and counted few friends. “He has a split personality,” Francis texted an associate. “It irritates me…. He is 40 and no girl or friend hangs out with him except me.”

Later, Beliveau’s lawyer would tell a judge he had witnessed a gang-related beheading in Timor-Leste and regularly had flashbacks triggered by a random smell or the sight of blood (NCIS officials have expressed skepticism about the beheading story). Beliveau said the PTSD caused him to enter a dissociative state, where he’d lose track of time, and was constantly aunted by bloodstained thoughts. Francis started booking rooms for Beliveau in Thailand and Singapore and providing him escorts in exchange for information on investigations into his firm. Beliveau disclosed identities of cooperating witnesses and targets of the investigation. In September of 2011, just two months after giving Aruffo and Francis the first set of ship schedules, an NCIS agent called Misiewicz in for an interview, asking about numbers extracted from his Blackberry. They were investigating an anonymous tip that someone in the Navy ranks was committing espionage. But the agent told Misiewicz not to worry – he wasn’t the target of the investigation. Shortly after, Beliveau told Francis over Skype, “Michael Misiewicz is a liability for you.”

NCIS had covert sources inside Glenn Defense, recording phone calls with Francis, and later collected a number of text messages. “Indictments r coming. Did you dump ur Gmail?” Beliveau texted at one point. “Delete contacts and boxes and delete ur trash bin.” But at the behest of federal prosecutors, NCIS sent a preservation hold to Google headquarters in Silicon Valley, shortly before Francis deleted his account. By then, Beliveau had been promoted to special agent in charge of the NCIS Quantico office, one of the most prestigious posts in the agency. He went into the K-Net system, the top-secret database NCIS uses to catalogue and track investigations, and began downloading reports. In April of 2013 alone, according to court records, he provided Francis 80 different K-Net reports. Rather than sending emails back and forth, they opened a mutual account and communicated through draft emails that were never sent – a common spy technique. Beliveau, who was described in a sentencing memo as the “Tom Hayden to Francis’ Don Corleone,” advised Francis to go “Sopranos.” No emails. No texts. No talking on the phone. If he had to talk to Misiewicz, he should only do so in person, and only “with noise” to protect himself from bugs.

Within NCIS, supervisors were pulling some of their best investigators to find the mole. They recruited a half dozen supply officers and Pacific Fleet personnel to help, requiring them to sign binding non disclosure agreements not to share information about the investigation. They also conducted an internal scrub to figure out if anyone else had gone rogue. The turning point came in the summer of 2013, when NCIS agents intentionally planted false memo in its case files declaring that several investigations into Francis were being closed for lack of evidence. Beliveau fell for the trap, passing the info on to Francis.

“Good news,” Francis texted an employee in July of 2013. “Thailand n Korea cases all closed, only Japan pending, and shud close.” Two months later, thinking he was in the clear, Francis flew to San Diego, hoping to sign more contracts, blissfully unaware everything he had built was about to come crashing down.

In the weeks after Francis’ capture, NCIS agents fanned out across the globe. On Sept. 16, the day Francis was arrested, agents interviewed Dave “Too Tall” Lausman, who had served as commander of the USS Blue Ridge in the days of the Brotherhood. Francis had bought hotel rooms for Lausman in Australia, Singapore and Thailand, delivered him cigars and fine wine, and dined with him in expensive restauarants. Lausman had written Francis all-important Bravo Zulu letters for new contracts, delivering him the Vladivostok, Russia contract, and later, as the commanding officer of the aircraft carrier USS George Washington, making sure he docked at a port Francis controlled, earning Glenn Defense $1.5 million. And yet, when NCIS officers asked if Lausman had ever received a gift from Glenn Defense, he said no. What about booking a room for him? “Not for me,” Lausman said according to NCIS files. “I’ve always called ahead of time and gotten rooms under my name.”

When agents left, however, Lausman removed a hard drive from the USS George Washington, which contained classified information, documents and emails, and destroyed it. That same day, Daniel Dusek, the captain of the USS Bonhomme Richard, deleted emails, hoping to avoid detection. Dusek had shared classified ship information with Francis, often making sure to deliver ship schedules in person to Aruffo . On Oct. 2, 2013, NCIS officials boarded the Bonhomme Richard, relieved Dusek of his duties and took him in to custody.

To date 20 active duty Navy officers have been charged in connection to the scandal and ten have been convicted, including Misiewicz, among the first suspects to cooperate with investigators, who was sentenced to seven years, and Beliveau, who got 12 years. “I think one of the fundamental things that’s missing from the prosecution narrative is that Fat Leonard, as disgusting and corrupt and sleazy as he was, and everybody knew it, he was also a strategic partner for the United States at a critical time,” one Navy officer told me. “This was a guy who was helping the United States get strategic access to ports all around the South China Sea at a time when our nation had made a strategic decision to try to jockey for access with China. He was able to get these Navy ships into very complicated and politically-sensitive areas.”

For the Navy, the scandal has been a slow moving embarrassment, tying up rank advancements and assignments. “The impact this is having on the talent pool in our Navy is that any officer who’s served out there in the last decade is now coming under scrutiny,” the navy officer says. “The net effect is you have a whole generation of leaders who have never served in what is arguably the most important operational theater we have.” In a worst case scenario – say war with North Korea or even China – this means the officers writing war plans would have no operational experience in the Pacific, meaning they wouldn’t know what a Chinese submarine sounds like, or how to sail an aircraft carrier into Hong Kong because they’ve never done it, a retired 7th Fleet captain says.

The scandal shows no sign of slowing. A recently retired Naval officer who served in the Pacific with Aruffo says Francis’ former Tokyo agent has repeatedly asked prosecutors to sentence him, but Aruffo has proven more valuable as an informant. Every couple weeks, investigators reach out with a new list of names, his friend says. For a time, NCIS was investigating Aruffo’s boss in the Navy, Admiral Jon Greenert, who, at Francis’ height, headed the 7th Fleet and eventually rose to the top spot in the Navy. But according to a friend, Aruffo maintains that Greenert is clean. “They’re going after some of the wrong targets,” says a high-ranking Navy official with insider information on the investigation. “If you look back at the 7th Fleet commanders, back to the 90s, how many of those guys became three and four stars (admirals) and were the type of people who hung out at Leonard’s parties? Most of them. I think there’s up to eight three or four star admirals who may still be charged.”

Anyone who crossed paths with Francis is afraid they could still be under investigation (which is why any active duty or retired Navy personnel contacted for this story spoke only under condition of anonymity). Many of those who had improper dealings with Francis are being handled by the Navy’s Consolidated Disposition Authority, which can issue letters of censure, reduce rank, force retirement or start the ball rolling for court martial. Terry Kraft, David Pimpo, Kenneth Norton and Michael Miller, who all retired as admirals, received letters of censure from the Navy last year, but only Pimpo, a supply officer, was demoted (the Navy city an $800 dinner on Francis’ tab). It’s unknown how many other cases the CDA is reviewing.

In the aftermath of the scandal, the Navy ordered a review of its contracting processes, and concluded that there were systematic problems, both with administration and oversight. NCIS also determined they needed more agents trained to spot and investigate white collar crimes. But those measures may not be enough to stop another Fat Leonard. “Congress has rewritten the laws to be very contractor friendly so the result is very few contracts are subject to much in the way of oversight,” says the Navy officer. “I would say the atmosphere is one where it’s well known that the likelihood of getting caught for transgressions has been reduced so markedly that that they think, ‘Oh, Ok, I can take this to the next level.’ The fraud is an outgrowth of a very, very relaxed atmosphere that has developed over the last two decades.”

Francis did not respond to repeated requests for comment for this story. His homes in Singapore and Malaysia have been sold and the large staff that tended his properties have been let go. The ships in his fleet, including the Braveheart, have all been sold to pay off his legal fees and mounting debt. He has been ordered to pay $35 million in restitution, and the U.S. government has seized his assets. He is expected to be sentenced this year. “I ask when has something like this, bribery of this magnitude, ever happened in this district or in our country’s history?” Robert Huie, an assistant U.S. attorney in San Diego, said during a court hearing for one of the defendants. “Mr. Francis’s conduct has passed from being merely exceptional to being the stuff of history and legend.”