A U.S. Navy Commander is accused of disclosing military secrets to a Singapore-based company in return for prostitutes and concert tickets, The Associated Press reported.
Federal prosecutors say Michael Vannak Khem Misiewicz of the U.S. Navy passed on confidential information to Leonard Francis, a Malaysian businessman well known to the Navy, about ship routes.
"It's pretty big when you have one person who can dictate where ships are going to go and being influenced by a contractor," said retired Rear Adm. Terry McKnight. "A lot of people are saying how could this happen?"
A hearing on Nov. 8 will likely set a trial date.
According to the federal complaint, Misiewicz and Francis moved vessels -- diverting aircraft carriers, destroyers and other ships -- to different Asian ports so Francis could inflate costs. As a result, the firm -- Glenn Defense Marine Asia Ltd., or GDMA -- overcharged the Navy for services it provided and created fake tariffs.
U.S. Attorney Laura Duffy said the company scammed the Navy out of $10 million in one year alone.
So far, a total of four people have been arrested -- Misiewicz; Francis; the head of global management at Francis' company, Alex Wisidagama; and senior Navy investigator, John Beliveau II, who prosecutors allege advised Francis during the scheme.
All four pleaded not guilty and defense attorneys have declined to comment.
In addition, other members of the Navy are listed in court documents for receiving gifts from Francis. Senior Navy officials reportedly said more names may come up in the case, but it is too early to tell.
According to navy spokesman Rear Adm. John Kirby, an investigation into the bribes began in 2010.
"He's a larger-than-life figure," McKnight said of Francis. "You talk to any captain on any ship that has sailed in the Pacific and they will know exactly who he is."
