WASHINGTON -- An intensifying criminal investigation of an alleged contracting scheme involving a top-secret Navy project has resulted in the forced resignation of the service's second-ranking civilian leader, according to officials and court documents.
Robert Martinage, acting undersecretary of the Navy, stepped down after his boss, Navy Secretary Ray Mabus, asked for his resignation "following a loss of confidence in [his] abilities to effectively perform his duties," according to a statement the Navy released Wednesday.
Navy officials said Mr. Martinage was pressured to quit after investigators scrutinizing his role in the top-secret program found he was having an affair.
Federal prosecutors testified last week in U.S. District Court in Alexandria, Va., that Mr. Martinage is not a criminal target of their inquiry. But they said one of his subordinates has told them that Mr. Martinage gave approval for a mysterious operation to acquire a large batch of firearm silencers intended for SEAL Team 6, the elite commando unit that killed Osama bin Laden.
In that case, three senior Navy intelligence officials who reported to Mr. Martinage are under investigation for an alleged contracting scheme that charged the military $1.6 million for homemade silencers that cost only $8,000 to manufacture, court records show.
The untraceable silencers were purchased from a hot-rod auto mechanic who is a brother of one of the Navy intelligence officials under scrutiny. The mechanic, Mark Landersman of Temecula, Calif., has been charged with conspiracy to commit wire fraud and to transport unregistered firearms. His attorneys have denied the charges.
Prosecutors said in court last week that the silencers were acquired for a "special access program," or a highly secretive military operation. One document filed in the case says the silencers were needed to support "the UPSTAIRS program," but does not give details.
Many aspects of the investigation have been kept under seal or described in closed court sessions. But some details emerged Friday in a rare hearing that was kept open to the public.
In that session, prosecutors said Lee Hall, one of the three Navy intelligence officials under investigation, recently told them Mr. Martinage had given oral approval for the silencer buys.
Prosecutors said they have interviewed Mr. Martinage but did not reveal his version of events. He is not a target of the criminal investigation, said Assistant U.S. Attorney Morris Parker Jr., the lead prosecutor.
Mr. Martinage, who has a background in special operations and intelligence, had been serving as acting undersecretary of the Navy since April. He also held the title of deputy undersecretary of the Navy for plans, policy, oversight and integration. He did not return a phone message seeking comment.
Mr. Hall is one of three Navy intelligence officials who have been described in court records as unindicted co-conspirators in the case. His attorney, Danny Onorato, declined to comment.
A second subject of the investigation is David Landersman, senior director for intelligence in the Navy's directorate for plans, policy, oversight and integration intelligence. A retired Marine colonel, Mr. Landersman is the brother of the auto mechanic. His attorney has said he engaged in no wrongdoing.
Court documents filed by prosecutors state that Mr. Hall, Mr. Landersman and another official who works in the same office, Sterling Gill, have been on administrative leave from their Navy jobs for the past 11 months. They have not been charged.