US Navy commander admits giving up state secrets for cash and prostitutes

A former US Navy commander has admitted receiving cash and prostitution services from a company in exchange for state secrets.

Stephen Shedd, 48, appeared in court in San Diego on Wednesday, January 26, where he pleaded guilty to two bribery charges under the “Fat Leonard” case.

The case has been named after the influential Malaysian defence contractor Leonard Glenn Francis, who founded Glenn Defence Marine Asia (GDMA) and was arrested in 2013.

Francis allegedly bribed senior admirals with prostitutes, along with tickets to see Lady Gaga perform and to watch The Lion King.

Shedd – along with eight other Navy officers – said he had received more than $250,000 (about £186,500) in meals, entertainment, travel, hotels, gifts, cash and prostitution services from GDMA.

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Some members of the fleet lived a life of luxury in exchange for giving up state secrets

He is the third person to plead guilty ahead of the trial, following his indictment in March 2017 with the eight other Navy members.

Francis pleaded guilty to bribery and conspiracy charges in 2015 and has remained in prison and home detention since then. The sentencing in his case is awaited.

Between 2006 to 2008, Shedd served as the fleet’s South Asia policy and planning officer.

He was responsible for identifying ports that Navy ships would visit.

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Shedd gave out schedules of naval movements to GDMA
Shedd gave out schedules of naval movements to GDMA

He admitted that he had given out the schedules of naval movements and lobbied on behalf of GDMA to other naval officials, according to the BBC.

Because of this, GDMA was able to win and maintain contracts and overbill the navy by $35m (£26.1m) for services including providing tugboats, security and waste removal to ships at port.

Shedd’s indictment had said that he was also one of the attendees of a $50,000 “raging multi-day party, with a rotating carousel of prostitutes, during which the conspirators drank all of the Dom Perignon champagne available at the Shangri-La” in Manila, Philippines, in 2008.

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The Carl Vinson Carrier Strike Group is operating as part of U.S. 7th Fleet
The Carl Vinson Carrier Strike Group is operating as part of U.S. 7th Fleet

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US Naval Criminal Investigative Service (NCIS) director Omar Lopez said: “Cmdr Shedd abused his high-level position in the Navy by illegally accepting lavish gifts from Mr Francis in exchange for providing Mr Francis classified ship schedules listing numerous ships, specific ports, and dates for the visits far in advance of ship visits.”

A California federal court is scheduled to sentence Shedd on July 21, while the trial for the remaining six naval officials from 7th fleet is set to start on February 28.


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