Military News

Friday, February 17, 2017

U.S. Navy Commander Charged as Part of Expanding Navy Bribery Scandal



A current U.S. Navy Commander was charged in a complaint unsealed today with accepting luxury travel, elaborate dinners and services of prostitutes from foreign defense contractor Leonard Francis in exchange for classified and internal U.S. Navy information.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Alana Robinson of the Southern District of California, Director Andrew L. Traver of the Naval Criminal Investigative Service (NCIS) and Director Dermot F. O’Reilly of the Defense Criminal Investigative Service (DCIS) made the announcement.

Mario Herrera, 48, of Helotes, Texas, was charged with one count of conspiracy to commit bribery in connection with interactions with Leonard Francis, the former CEO of Glenn Defense Marine Asia (GDMA), a defense contracting firm based in Singapore.  Herrera was arrested in San Antonio, Texas, this morning and is scheduled to make his initial appearance in federal court in the Western District of Texas.  The United States will seek removal of Herrera to San Diego to face charges.

According to the complaint, Herrera participated in a bribery scheme with Francis in which he accepted luxury travel and entertainment expenses and the services of prostitutes in exchange for helping to steer lucrative U.S. Navy contracts to Francis and GDMA.  Herrera provided Francis with internal, proprietary U.S. Navy information and intervened on GDMA’s behalf in contract disputes.  According the complaint, Herrera directed ships to take alternative routes that benefitted GDMA on two separate occasions, costing the U.S. Navy $3.6 million.   

To date, a total of 17 individuals have been charged in connection with the scheme; of those, 13 have pleaded guilty, including: Admiral Robert Gilbeau, Captain Michael Brooks, Commander Bobby Pitts, Captain Daniel Dusek, Commander Michael Misiewicz, Lt. Commander Todd Malaki, Commander Jose Luis Sanchez, former NCIS Special Agent John Beliveau and U.S. Petty Officer First Class Daniel Layug.

Brooks, Gilbeau and Sanchez await sentencing.  In May 2016, Pitts was charged and his case is currently pending.  On Jan. 21, 2016, Layug was sentenced to 27 months in prison and to pay a $15,000 fine.   On Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine.  On March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine.  On April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay  $95,000 in restitution to the Navy and a $100,000 fine.  On Oct. 14, 2016, Beliveau was sentenced to 12 years in prison and to pay $20 million in restitution.  On Dec. 2, 2016, Simpkins was sentenced to 72 months in prison, to pay $450,000 in restitution, to forfeit $150,000 and pay a $50,000 fine. 

A criminal complaint is merely an accusation, and the accused is presumed innocent unless proven guilty in a court of law.

DCIS, NCIS and the Defense Contract Audit Agency are investigating the case.  Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California are prosecuting the case. 

Tuesday, February 07, 2017

U.S. World War I Centennial Commission Announces Centennial Commemoration of U.S. Entry into World War l



Washington, D.C. — The United States World War I Centennial Commission today officially announced the national ceremony commemorating the centennial of the United States entry into World War I, a war that changed the nation and the world forever.

The national ceremony, “In Sacrifice for Liberty and Peace: Centennial Commemoration of the U.S. Entry in World War I,” will be held on April 6, 2017 at the National World War I Museum and Memorial in Kansas City, Mo. Invited attendees include the President of the United States; Congressional leadership; Cabinet members; State governors; U.S. military leaders; veteran organizations; representatives from U.S. military legacy units that trace their history back to World War I; descendants of significant American WWI figures; and other organizations, dignitaries, and VIPs. International invitees include the Heads of State of Australia, Austria, Belgium, Canada, France, Germany, Hungary, Italy, the United Kingdom, and all other nations whose people were involved in the Great War.

On April 6, 1917, after much debate, the United States entered World War I. The ceremony in Kansas City, and complementary events around the nation, will encourage every American to reflect on what that moment meant, how it continues to influence the nation, and how every American family, then and now, is linked to that perilous time.
“The April 6 ceremony in Kansas City is an important element of the national conversation about World War I,” said Dan Dayton, executive director of the World War I Centennial Commission. “Why should we care? Because we are all products of World War I. The entire country was involved— everyone has a story. The Commission’s goal is to inspire you to find your personal story and connection.”
“In Sacrifice for Liberty and Peace: Centennial Commemoration of the U.S. Entry in World War I” will consist principally of the reading of passages from significant and representative American writings of a century ago about the U.S. decision to enter the war, including selections from speeches, journalism, literature, poetry, and performance of important music of the time. Invited American readers include the President of the United States, Congressional leadership, and descendants of U.S. World War I veterans. Certain Heads of State from other nations are invited to read passages reflecting the reaction of their respective nations to the U.S. entry into the war in 1917.
The ceremony will also include flyovers by U.S. aircraft and Patrouille de France, as well as a military band, color guard, ceremonial units, and video productions. Students across the nation will participate in this historic event, learning how WWI changed the United States and the world.
America’s entry into the Great War created profound change throughout the country. WWI military Historian and archivist at the National Archives and Records Administration Mitchell Yockelson explains that “although the union was again whole after the end of the American Civil War, the United States remained fractured. Recovery was slow until the turning point of reconciliation occurred 52 years later. On April 6, 1917, Americans cast aside past sectional and political differences, donned the same uniform and fought as one under a singular president and field commander in the Great War.”
World War I Centennial Commissioner Dr. Monique Seefried said it is critical that the nation remember the momentous events of World War I.
“It is so important to understand the debate that was going on within the United States about entering World War l. In reaching that decision, the nation became united for the first time in decades. Our goal was to bring peace to a world that had become inflamed. The subsequent decisions and actions taken 100 years ago helped shape and define the world we live in today.”
Designated by the U.S. Congress in 2004 as the official museum dedicated to WWI, and in 2014 as America's National World War I Museum and Memorial, the Museum is uniquely positioned to host the official Commission event. “It’s a fitting tribute to those who served in the Great War that we commemorate the entry of the United States into World War I in the very same place where millions of visitors from across the world have paid tribute for nearly a century,” said National World War I Museum and Memorial President and CEO and World War l Commissioner Dr. Matthew Naylor. “The National World War I Museum and Memorial is committed to remembering, understanding and interpreting the Great War and its enduring impact and this event underscores how this calamitous conflict continues to significantly affect everyone to this day.”

The ceremony launches an 18-month long commemoration period of the United States’ involvement in WWI, marked by anniversaries of specific events of the war, including major engagements of U.S. forces, key local dates, and more. More information on key events can be found at ww1cc.org/events.

For additional information or to request an interview with the Commission or its spokespeople, please contact Paulo Sibaja, psibaja@susandavis.com or 202-414-0798.

About the World War I Centennial Commission
The Commission was established by the World War I Centennial Commission Act, passed by the 112th Congress and signed by President Barack Obama on January 16, 2013, and is responsible for planning, developing, and executing programs, projects, and activities to commemorate the centennial of World War I. The mission is to educate the country’s citizens about the causes, courses and consequences of the war; honor the heroism and sacrifice of those Americans who served, and commemorate the Great War through public programs and initiatives. To learn more about the Commission activities, visit ww1cc.org/tools.

To further the mission, the Commission is leading the effort to build the National World War I Memorial at Pershing Park in Washington, D.C. to honor the 4.7 million American veterans who served. To learn more about the Memorial, visit ww1cc.org/memorial.

The Commission’s founding sponsor is the Pritzker Military Museum and Library (PMML) in Chicago, Ill. PMML is a nonpartisan research institution dedicated to enhancing public understanding of military history and the sacrifices made by America's veterans and service members. To learn more about PMML, visit www.pritzkermilitary.org.
About the National World War I Museum and Memorial

The National World War I Museum and Memorial is America’s leading institution dedicated to remembering, interpreting and understanding the Great War and its enduring impact on the global community. The Museum holds the most diverse collection of World War I objects and documents in the world and is the second-oldest public museum dedicated to preserving the objects, history and experiences of the war. The Museum takes visitors of all ages on an epic journey through a transformative period and shares deeply personal stories of courage, honor, patriotism and sacrifice. Designated by Congress as America’s National World War I Museum and Memorial and located in downtown Kansas City, Mo., the National World War I Museum and Memorial inspires thought, dialogue and learning to make the experiences of the Great War era meaningful and relevant for present and future generations. To learn more, visit theworldwar.org.

Monday, September 26, 2016

Four Chinese Nationals and China-Based Company Charged with Using Front Companies to Evade U.S. Sanctions Targeting North Korea’s Nuclear Weapons and Ballistic Missile Programs



Company Allegedly Violated Sanctions by Facilitating U.S. Dollar Transactions on Behalf of a North Korean Bank with Ties to Weapons of Mass Destruction Proliferators

Four Chinese nationals and a trading company based in Dandong, China, were charged by criminal complaint unsealed today with conspiring to evade U.S. economic sanctions and violating the Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR) through front companies by facilitating prohibited U.S. dollar transactions through the United States on behalf of a sanctioned entity in the Democratic People’s Republic of Korea (North Korea) and to launder the proceeds of that criminal conduct through U.S. financial institutions.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Paul J. Fishman of the District of New Jersey and Assistant Director E.W. Priestap of the FBI’s Counterintelligence Division made the announcement.

On Aug. 3, 2016, a U.S. Magistrate Judge Joseph A. Dickson of the District of New Jersey signed a criminal complaint charging Ma Xiaohong (Ma) and her company, Dandong Hongxiang Industrial Development Co. Ltd. (DHID), and three of DHID’s top executives, general manager Zhou Jianshu (Zhou), deputy general manager Hong Jinhua (Hong) and financial manager Luo Chuanxu (Luo), with conspiracy to violate the International Emergency Economic Powers Act (IEEPA) and to defraud the United States; violating IEEPA; and conspiracy to launder monetary instruments.

Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) also imposed sanctions on DHID, Ma, Zhou, Hong and Luo for their ties to the government of North Korea’s weapons of mass destruction proliferation efforts.

In addition, the department filed a civil forfeiture action for all funds contained in 25 Chinese bank accounts that allegedly belong to DHID and its front companies.  The department has also requested tha the federal court in the District of New Jersey issue a restraining order for all of the funds named in the civil forfeiture action, based upon the allegation that the funds represent property involved in money laundering, which makes them forfeitable to the United States.  There are no allegations of wrongdoing by the U.S. correspondent banks or foreign banks that maintain these accounts.

“The charges and forfeiture action announced today allege that defendants in China established and used shell companies around the world, surreptitiously moved money through the United States and violated the sanctions imposed on North Korea in response to, among other things, its nuclear weapons program,” said Assistant Attorney General Caldwell.  “The actions reflect our efforts to protect the integrity of the U.S. banking system and hold accountable those who seek to evade U.S. sanctions laws.”

“The charges unsealed today reflect our nation’s commitment to using all tools to deter and disrupt weapons of mass destruction proliferators,” said Assistant Attorney General Carlin.  “One of the strengths of our sanctions programs is that they prevent sanctioned wrongdoers from engaging in U.S. dollar transactions.  Denying the use of the U.S. financial system can greatly curtail illegal activities and disrupt efforts to provide weapons of mass destruction to terrorists and rogue nations.  Those who seek to evade our financial sanctions will be fully prosecuted, and we will be unflagging in our efforts to bring them to justice.”

“The FBI takes violations of these laws extremely seriously and will not hesitate to use our full investigative resources to stop this type of illegal activity,” said Assistant Director Priestap.  “In this case agents, analysts and forensic accountants from field offices in Phoenix and Newark, as well as FBI Headquarters, all contributed to a successful investigation.”

According to criminal and civil complaints, DHID is primarily owned by Ma and is located near the North Korean border.  DHID allegedly openly worked with North Korea-based Korea Kwangson Banking Corporation (KKBC) prior to Aug. 11, 2009, when the OFAC designated KKBC as a Specially Designated National (SDN) for providing U.S. dollar financial services for two other North Korean entities, Tanchon Commercial Bank (Tanchon) and Korea Hyoksin Trading Corporation (Hyoksin).  President Bush identified Tanchon as a weapons of mass destruction proliferator in June 2005, and OFAC designated Hyoksin as an SDN under the WMDPSR in July 2009.  Tanchon and Hyoksin were so identified and designated because of their ties to Korea Mining Development Trading Company (KOMID), which OFAC has described as North Korea’s premier arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons.  The United Nations (UN) placed KOMID, Tanchon and Hyoksin on the UN Sanctions List in 2006.  In March 2016, KKBC was added to the UN Sanctions List.

In August 2009, Ma allegedly conspired with Zhou, Hong and Luo to create or acquire numerous front companies to conduct U.S. dollar transactions designed to evade U.S. sanctions.  The complaints allege that from August 2009 to September 2015, DHID used these front companies, established in offshore jurisdictions such as the British Virgin Islands, the Seychelles and Hong Kong, and opened Chinese bank accounts to conduct U.S. dollar financial transactions through the U.S. banking system when completing sales to North Korea.  These sales transactions were allegedly financed or guaranteed by KKBC.  These front companies facilitated the financial transactions to hide KKBC’s presence from correspondent banks in the United States, according to the allegations in the complaints.

As a result of the defendants’ alleged scheme, KKBC was able to cause financial transactions in U.S. dollars to transit through the U.S. correspondent banks without being detected by the banks and, thus, were not blocked under the WMDPSR program.

A complaint is merely an allegation and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The FBI is investigating the case.  Trial Attorneys Jennifer Wallis and Michael Parker of the Criminal Division’s Asset Forfeiture and Money Laundering Section, Trial Attorney Christian Ford of the National Security Division’s Counterintelligence and Export Control Section and Chief Barbara Ward and Assistant U.S. Attorneys Joyce Malliet and Sarah Devlin of the District of New Jersey are prosecuting the case.  The Criminal Division’s Office of International Affairs provided valuable assistance in this matter.