Feds target Miami Beach arms merchant (22- year-old)

[seafan]

Source: Miami Herald

A young Miami Beach businessman whose $300 million military contract has been suspended by the Army faces a criminal investigation by federal authorities in Washington and Miami, according to law enforcement officials familiar with the case.
Efraim E. Diveroli, 22, is under investigation for allegedly selling Chinese-made ammunition to the military to supply Afghan soldiers fighting al Qaeda and Taliban insurgents, the officials said. Such munitions sales are a possible violation of U.S. law.

Diveroli, president of AEY Inc., could not be reached for comment. His Miami lawyer, Hy Shapiro, said Thursday his client's company received the Army's suspension notice on Wednesday but was awaiting further documentation.

.....

The improbable story of such a young man winning such a lucrative government contract was first published by The New York Times, which detailed Diveroli's history as an arms merchant who had misled the Army by saying the weaponry was Hungarian.
According to the Times, much of the ammunition came from aging stockpiles of old Communist bloc countries, which the State Department and NATO have deemed unreliable and obsolete.

Both the Department of Defense's inspector general and Immigration and Customs Enforcement are investigating Diveroli's alleged network of arms trafficking, the Times reported.

Read more: http://www.miamiherald.com/459/story/472504.html

[spindrifter]

1. This is one of the most bizarre stories

imaginable! The company was started some time ago by the young man's dad. Then the young man and his friends start playing high-rollers with lucrative DOD contracts, dealing ammo that was highly dangerous and some of which was laundered through another company believed to be paying kickbacks to Albanian government officials. And who gets the short end of the (dynamite) stick? The Afghans. And who gets to pay for these shenanigans? We U.S. taxpayers!

[Tandalayo_Scheisskopf]

2. I was just gonna post the same thing.

22 years old, sitting on 300 Million of US contracts. Who do you have to blow to get action like that?

This is gonna be such a movie. Hollywood producers' jets must be dogfighting on the way to Miami, to get the film rights. If Mike Judge does not get to direct, there is no justice left in this world. ;-)

[AngryAmish]

11. Mike Judge will never be allowed to make a major motion picture again

Idiocracy was seen as advocating eugenics.

[Divine Discontent]

3. I hate the way these dealings go down..

it's a crime how ridiculous this crap is... How the gov't didn't realize instantly that the ammo was in old boxes, breaking down, etc, is beyond me...
President & VP... the way this country is run, they'll be the real thing in 30 years.

[Divine Discontent]

4. ah, he figured he'd get a businesman's haircut I see, the other pics are from the NYT

[harmonicon]

5. Man, isn't capitalism awesome?!?! Pay the lowest price, no matter what! What could ever go wrong?!

[darue]

6. surely for $300 million the government could have built it's self a factory

what a waste, these god damned republicans make, privatizing is such a blatant transparent scam.

[sasquatch]

7. Are these guys Batista Loyalist?

[peacetalksforall]

8. I think there is a second side of this - who else is in on this? Who

didn't do their job{s} and why?

[KoKo]

13. Some posts on Josh Marshall's Website (before scrubbing) had interesting connections

of Diveroli's family going out to LA...connected with a Rabbi who does HDTV...

Here's what I managed to copy before Josh scrubbed the "Main Article" and the "Comments Section" where his own reporter picked out the relevant parts of it and there were some very interesting replies.

Here's the one I kept befor the "scrubbing."

---------
TPM...COMMENTER:

VERY interesting research...combined with the front page of NYTimes lengthy article today (3/27) and an earlier Times piece from last Nov there's quite a case established...consider how peculiar appointing your 22 yr old son to be President of a munitions (illegal munitions at that) company, filing multi million dollar contracts with Dod ($300M last one) for worthless ammo to be sent to Afghanistan or Iraq for training the cops/soldiers to "stand up" for American troops. Tax payer rip off a plenty...but the situation even has another edge...remember the swell TV rabbi, Shmuely Boteach who Michael Jackson's pal? who got cozy with Oprah? who got a tv gig on HGTV for Shalom inthe Home? etc etc..he is UNCLE to Efraim..the 22 yr old...because Shmuely's family has been 'enterprising'...his sister Ataret is Efraim's mother helped him out wiht his British 'charity' that ended up being shut downfor some fraudulent reasons..Rabbi Shmuely's all over the place.
Posted by steve12f
March 27, 2008 7:22 PM | Reply | Permalink

[Vogon_Glory]

9. Corruption, Lack of Accountability, Lack of Oversight

Let's remember this squalid story this November. Diveroli's antics were made possible by an administration that doesn't believe in oversight, doesn't believe in accountability to its citizens or American taxpayers, and tolerates corruption. This guy got caught because he was a small-timer and lacked the right lawyers and lobbyists. The Repud behavior isn't likely to change just because one politico goes home to Texas (And his handler goes off to Dubai) and another Repud moves into the White House.

Harry Truman made a name for himself investigating corruption during World War Two. So where are our guys and why are they sitting on their hands while connected contractors are bilking US taxpayers in Iraq and Afghanistan?

:argh:

:dem:

[seafan]

10. War contracts tell sad story about America

War contracts tell sad story about America


MIAMI-DADE CORRECTIONS
A mugshot of 22-year-old gun merchant Efraim Diveroli after his arrest on drunk driving charges on Miami Beach on March 5. He was released on $1,000 bond. The case is pending.


BY ANA MENEDEZ
March 30, 2008

To the young man, caught in the tawdry glamour of South Beach, it must have seemed a hallucinatory dream: millions in military contracts simply for the asking.
So Efraim Diveroli asked, bidding for the right to supply munitions to the Afghan Army. Nevermind that Diveroli, president of AEY Inc., was barely out of his teens. Or that AEY's specialty was not arms-dealing but scrap-brokering. What mattered is that AEY offered the winning bid. And by 2007, the U.S. Army -- clearly impressed -- had awarded the company contracts worth almost $300 million. This week, embarrassed, it reconsidered.

''You are hereby suspended from future contracting with any agency in the executive branch of the United States Government,'' begins the sternly worded letter the Army mailed Diveroli March 25.
The story -- very Miami and very 2008 America, in both its corruption and comeuppance -- was first reported by The New York Times. Now the full rage of the U.S. government is upon Diveroli, Miami Beach bon vivant, businessman and erstwhile arms dealer at age 22.

The Army wants to know if Diveroli misled them by supplying junk Chinese munitions. And Rep. Henry Waxman wants to investigate how it all happened. ..... To help answer that last question, one needs to go back to World War II. War profiteering is as old as war itself. But it wasn't until the government began to contract out much of the business of war-making that the market in scandal really took off.
''Privatization'' -- expanded in the Reagan era -- was supposed to end government waste, fraud and abuse by contracting private firms to do the work more efficiently. Instead, the scheme's lasting accomplishment was that it transferred fraud and abuse into private hands.

The ill-planned wars in Afghanistan and Iraq -- with their management blunders and poor oversight -- have become especially profitable ventures for the unscrupulous.
Last year, five men in Iraq were charged with directing $8 million in reconstruction funds to a construction firm in exchange for computers, airline tickets and jewelry.
Halliburton -- the gargantuan contractor with ties to Vice President Dick Cheney -- has been pursued by persistent allegations of fraud related to fuel purchases. In 2005, an employee of a Halliburton subsidiary was indicted for defrauding the military of $3.5 million. Separately, the Army has opened some 50 criminal investigations involving bribery and bid-rigging among contractors in Iraq.

.....

Defrauding the government -- if that's what Diveroli did -- has become so commonplace as to blunt outrage. Providing shoddy equipment to allies would be the bigger sin.

For now, the saddest part of the scandal is what it says about the country we have built. Even if Diveroli is proved innocent, he has already exposed the hypocrisies and inequalities of a war where one man's son is sent to die in battle, while another stays home, scrounging for a way to turn the violence into handsome profit.

[KoKo]

12. I wonder what the two reporters on this story had before their Editor Scubbed them............

I would think they did alot of "footwork" on this story...connected it back to NYT's and yet when they submitted...this is the crap "rehash" that readers got. Flip along from page A-16 where you story is buried under ads or articles about "Pet Owners finding Pet Hotels a Great Relief."

:eyes: AYYYYYY