A lengthy investigation published Thursday reveals that the Pentagon gave an inexperienced 22-year-old a $300 million contract to provide ammunition to Afghanistan. The shady deal resulted in decades old, substandard munitions being delivered to US and Afghan troops fighting on the front lines of the war on terror.
Following publication of a lengthy New York Times article, the House Oversight Committee announced it would investigate AEY Inc., a fledgling company that thrived after 2003 as the US government began handing out billions of dollars to private defense contractors. Chairman Henry Waxman invited company officials as well as representatives of the State and Defense departments to testify at a hearing next month, according to a news release.
The results of that investigation, which sent seven reporters across three continents, were published Thursday.
But to arm the Afghan forces that it hopes will lead this fight, the American military has relied since early last year on a fledgling company led by a 22-year-old man whose vice president was a licensed masseur. With the award last January of a federal contract worth as much as nearly $300 million, the company, AEY Inc., which operates out of an unmarked office in Miami Beach, became the main supplier of munitions to Afghanistan’s army and police forces. Since then, the company has provided ammunition that is more than 40 years old and in decomposing packaging, according to an examination of the munitions by The New York Times and interviews with American and Afghan officials. Much of the ammunition comes from the aging stockpiles of the old Communist bloc, including stockpiles that the State Department and NATO have determined to be unreliable and obsolete, and have spent millions of dollars to have destroyed.
In purchasing munitions, the contractor has also worked with middlemen and a shell company on a federal list of entities suspected of illegal arms trafficking.
The company's president was 22-year-old Efraim E. Diveroli, who ran the company with a 25-year-old from Miami Beach, Florida. Waxman has requested that Diveroli testify, along with company vice president David M. Packouz and Levi Meyer its general manager.
On his MySpace page, Diveroli claims that "problems in high school" forced him to work through most of his teenage years, but that "of course im (sic) a super nice guy!!!"
More on the story
From Waxman's website:
Committee Announces Hearing on Arms Contract
Chairman Henry A. Waxman announced that the Oversight Committee will hold a hearing on Thursday, April 17, 2008, to examine federal contracts awarded to AEY Inc. to supply weapons, ammunitions, and munitions to military forces in Iraq and Afghanistan.
According to the New York Times, AEY was awarded a contract worth nearly $300 million, but provided defective, unreliable ammunition, including shipments of Chinese ammunition, to Afghanistan army and police forces. The hearing will examine the company’s financial history, past performance, and compliance with U.S. law and government contracting regulations as well as the federal government’s efforts to investigate allegations that AEY may have violated U.S. law and government contracting regulations.
The following individuals are invited to testify:
o Efraim E. Diveroli, President, AEY Inc.
o David M. Packouz, Vice President, AEY Inc.
o Levi Meyer, General Manager, AEY Inc.
o Senior Official, Department of Defense
o Senior Official, Department of State
Documents and Links
Press Release (61 KB)
Letter to Efraim E. Diveroli (82 KB)
Letter to David M. Packouz (78 KB)
Letter to Levi Meyer (81 KB)
Letter to Secretary Gates (88 KB)
Letter to Secretary Rice (88 KB)
1 comment:
This is a class in money laundering. I learn so much in Law School as I became a Paralegal only to find out it was book knowledge only. Now the trusted Pentagon used the taxpayers money to funnel money by way of this front company. How many more fake companies are there set up by the White House Crime Group. No wonder they had to get rid of Spitzer this is something he knows how it's worked. Waxman better get another 10,000 boxes of writing pads he'll need it for the list he'll fine of fake companies. Now was this a misstep or is there a rush on getting the goods out before the end of the Bush Term.
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