Glenn Defense Marine Asia (A)

This case describes the growth of Glenn Defense Marine Asia (GDMA) under the leadership of Leonard Glenn Francis. GDMA provided ship husbanding and logistical support services to the United States Navy when Navy ships visited various ports in Southeast Asia. The case details the role of ship husbanding in U.S. Navy operations and the contracting process for procuring ship husbanding services. In order to help win contracts, Francis developed relationships with an extensive network of U.S. Navy officers, often by treating them to lavish meals and luxury accommodations during port visits. He used this network of contacts to acquire confidential information about U.S. Navy ship operations and port visits, giving GDMA an advantage in bidding for contracts. The case relates how Francis and GDMA came under investigation for these tactics and allows for discussion of whether these tactics were potentially illegal and/or unethical. The (A) case concludes with Francis’ arrest by U.S. authorities. The (B) case describes the aftermath of Francis’ arrest, including the prosecution and sentencing of his co-conspirators and the termination of U.S. Navy contracts with GDMA. The (B) case further describes a U.S. Navy audit of contracting practices and changes implemented to prevent future unethical or corrupt contracting as had occurred on a widespread basis between GDMA and the U.S. Navy. This case supports a discussion of internal control practices to contain risk of fraud and misconduct.