Has anyone posted about those "Gun Running Punks in Miami" ripping off Taxpayers for Arms Deals?

[KoKo]

Exclusive: 22-year-old Pentagon arms dealer also marketed to civilians
03/28/2008 @ 7:23 am
Filed by Nick Juliano

The 22-year-old Florida man who allegedly provided old, substandard Chinese-manufactured ammunition to troops in Afghanistan as part of a nearly $300 million Pentagon contract also started a private company that specialized in selling foreign munitions to civilian gun enthusiasts, according to public documents, a RAW STORY investigation reveals.
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Efraim E. Diveroli, 22, could face federal fraud charges after he tried to pass off the Chinese ammo as manufactured in Hungary. His company, AEY Inc., was banned from doing future business with the Defense Department after the New York Times revealed the shady circumstances surrounding a $298 million contract he received in January 2007.

In addition to the Miami-based AEY, Diveroli started a separate company, AmmoWorks, which advertised products such as Lithuanian GGG .308 Ammunition, MP-5 Magazines and an RPK40 magazine. A toll-free phone number listed on AmmoWorks Web site rings directly to AEY's Miami headquarters.

The company's Web site was taken down after RAW STORY began asking questions.

A company representative refused to comment on the connection between the two companies.

"I really wouldn't be the person to speak to about that. I don't have anything to say. Thank you," Boz Kramer, who was listed as the director of AmmoWorks' commercial division, told RAW STORY Wednesday.

Unlike AEY, AmmoWorks did not receive any lucrative government contracts, according to several database searches. But the two companies apparently shared office space and support staff in Miami, and Florida public documents list Diveroli as AmmoWorks' sole officer.

AEY apparently did the bulk of its business supplying weapons and ammunition to Afghan security forces, and it received government contracts for other agencies dating back at least 2004. The company is now suspected of fraud for misidentifying where it purchased munitions abroad, the Times reported Friday.

Like AEY, AmmoWorks also specialized in re-selling foreign ammo, and the company boasted of its government contracts on its Web site.

Ammoworks has produced hundreds of millions of dollars worth of firearms, ammo, and tactical gear among other things for our special forces in Iraq and Afghanistan. Ammoworks is a huge supporter of our troops and does everything in its power to not only insure a quality product but a product that functions extremely well in battle situations.

In 2006 Ammoworks began to import extra goods that were produced for Government contract in Eastern Europe and Asia. We started as a wholesaler but in 2008 we will be branching out to incorporate a full scale retail web site. All goods are insured by our company and certified from the manufacturer. Everything we sell is backed by our money back guarantee. We are able to offer the best prices because we are the importer and are direct with the factories in production of goods overseas.

After RAW STORY contacted AmmoWorks Thursday to inquire about its connection to Diveroli and AEY, the company's Web site was taken down. According to a domain registry Diveroli started AmmoWorks.org in December 2007.

The following flyer, which was removed from the site, was recovered from a search engine's cache:

A Florida Certificate of Domestication, signed by Diveroli, shows that AmmoWorks was incorporated in Florida March 6. AmmoWorks apparently grew from another company, Manchester Property Corporation, which Diveroli incorporated in Nevada on Aug. 6, 2004.

http://rawstory.com/

By the time Diveroli incorporated AmmoWorks in Florida three weeks ago, he must have known the New York Times was investigating AEY's suspicious defense contract. The paper published the results of its months long investigation Thursday; the article referred to a conversation a reporter had with Diveroli late last year.

One of the biggest mysteries surrounding AEY remains how the company run by a few inexperienced 20-somethings managed to procure hundreds of millions of dollars worth of government contracts; the House Oversight Committee is planning an investigation. AEY's vice president was 25-year-old David Packouz, who is a licensed masseur. Another 25-year-old, Levi Meyer, briefly served as a general manager. Myer told the Times, "I'm not involved in that mess anymore."

Florida filings also list a Yeshaya Diveroli as secretary of AEY.

Despite the Diveroli connection and shared phone line, none of the known AEY employees were listed on AmmoWorks now-defunct Web site, which listed eight sales representatives. Kramer apparently is the point of contact for this Craigslist classified ad seeking an AEY administrative assistant.

It's not clear how many employees AmmoWorks still has. At least one sales rep listed on AmmoWorks site said when RAW STORY reached him Thursday that he was no longer with the company.

AmmoWorks primarily advertised its products on online forums catering to gun enthusiasts.

"We are a major distributor for this .308 ammo and we are distributing quite a bit to various online retailers and we are still running an exclusive to everyone who can purchase a min pallet purchase," Kramer wrote on one forum last August. "Please act fast because our stock is dwindling and once its gone its gone."

RAW's previous report on AEY can be read at this link.....

http://rawstory.com/news/2008/22yearold_arms_dealer_under_investigation_established_0328.html


-------------------------------
Link to NYT ARTICLE that Exposes the 19 year old and his partner the masseuse who were getting Quarter of a Billion from the US ARMY to SUPPLY FAULTY WEAPONS to AFGHANISTAN! Operating out of a "Miami Adress!" You couldn't make this up it's so BIZARRE:

http://www.nytimes.com/2008/03/27/world/asia/27ammo.html

[blm]

1. BushInc's been running arms illegally for over 4 decades. Anyone think they stopped in Jan1993

just because Poppy was not physically IN the White House anymore?

[islandmkl]

2. 22- and 25-year olds running guns, inside and outside of our DOD....

yeah...do you get the feeling there is a little more to this story?

[blm]

3. Exactly - sounds more like the runners who worked during the 70s and 80s under Poppy Bush

and his crew, eh?

[KoKo]

28. These was a Kid with fake driver's license and domestic abuse arrest...and

he and his "massage therapist" buddy travel around to countries on US "Caution List" dealing with underworld Arms Dealers? I don't think it was this bad before Bush II. They didn't have 18 year olds able under the tightest security we've ever seen in this country doing this kind of thing. It was mostly left to "underworld thugs/Mafia" Bush buddies. But, then...maybe many of them were "underage with Fake ID's, too" and we just didn't find out about it. :eyes:

[seemslikeadream]

4. Yes KoKo01 3 times I have and look what happened in 9/11 - yea bizarre!

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=125&topic_id=199949&mesg_id=199949


62-53=9 :shrug:

[seemslikeadream]

5. Efraim was "a boy genius" who is "hard to control."

Efraim was "a boy genius" who is "hard to control."

At first, Pentagon defended its contractor AEY proposal represented best value to the goverment

http://www.guardian.co.uk/world/2008/mar/28/afghanistan.usa

At first, the Pentagon defended its contractor. "AEY's proposal represented the best value to the government," the Army Sustainment Command wrote to the New York Times. Henry Waxman, the member of congress from California who heads the committee on government oversight, said yesterday he would conduct hearings into the contract next month.



........



In 2006, AEY was among 10 firms bidding on a contract to supply 52 kinds of ammunition for the Afghan security forces. But while his business was taking off, Diversoli was accused of violent behaviour involving two girlfriends and the parking attendant at his apartment building. In December 2006, Diversoli was charged with battery after beating up the parking attendant, according to the newspaper. Police recovered a forged driving licence from Diversoli's flat which led to a separate charge. He entered a programme for first time offenders to avoid trial.

AEY's contract was approved weeks later in January 2007, and Diversoli began scouring the globe for suppliers. Diversoli turned to Albania, which had large weapons dumps. However, the New York Times reported that the firm ended up paying for Kalashnikov rounds that were so obsolete that the US and Nato funded programmes to see them safely destroyed.

AEY also purchased 9 million cartridges from a Czech citizen who had been linked to illegal arms trafficking to Congo.



......



AEY also supplied weapons to US agencies, and rifles to Iraqi forces






AEY & Efraim Diveroli: Subject to the Foreign Corrupt Practices Act?


http://pogoblog.typepad.com/pogo/2008/03/aey-efraim-dive.html

AEY & Efraim Diveroli: Subject to the Foreign Corrupt Practices Act?
Based on my quick Google search of the web for AEY, Efraim Diveroli and "Foreign Corrupt Practices Act," I haven't seen anyone ask the question (though someone may have): Is Efraim Diveroli's alleged bribery of Albanian government officials, if true, a violation of the Foreign Corrupt Practices Act? It seems that it would be the case. According to the New York Times:

As Mr. Diveroli began to fill the Army’s huge orders, he was entering a shadowy world, and in his brief interview he suggested that he was aware that corruption could intrude on his dealings in Albania. “What goes on in the Albanian Ministry of Defense?” he said. “Who’s clean? Who’s dirty? Don’t want to know about it.”

The way AEY’s business was structured, Mr. Diveroli, at least officially, did not deal directly with Albanian officials. Instead, a middleman company registered in Cyprus, Evdin Ltd., bought the ammunition and sold it to his company.

The local packager involved in the deal, Mr. Trebicka, said that he suspected that Evdin’s purpose was to divert money to Albanian officials.

The purchases, Mr. Trebicka said, were a flip: Albania sold ammunition to Evdin for $22 per 1,000 rounds, he said, and Evdin sold it to AEY for much more. The difference, he said he suspected, was shared with Albanian officials, including Mr. Pinari, then the head of the arms export agency, and the defense minister at the time, Fatmir Mediu.

...

The conversation, he said, showed that the American company was aware of corruption in its dealings in Albania and that Heinrich Thomet, a Swiss arms dealer, was behind Evdin.




http://www.miamiherald.com/news/columnists/fred_grimm/story/475617.html
But Sonnett was taken aback by Diveroli. ``Well, I think it is passing strange that a 22-year-old can sign a $300 million worth of weapons contract with the Pentagon. I suppose the American dream is always possible.''

Even by the mythical standards of South Florida, a 20-something Miami Beach party boy seems an unlikely entry in our gallery of rogue arms peddlers with the likes of Soghanalian. Or Nazi turned arms smuggler Klaus Altmann-Barbie. Or Fort Lauderdale's flamboyant Ken Burnstine, the drug smuggler and arms dealer who may -- or not -- have perished in a 1976 plane crash. Or Gerard Latchinian, whose arms dealings were interrupted when he was caught plotting a coup in Honduras. Or David Duncan, tripped up in a deal sending guns to Peru. Or the bevy of Miami arms dealers exposed in the Iran-Contra scandal.

http://www.exportlawblog.com/archives/313

Of course, you didn’t expect that this blog would let a story about an arms company run by a 22-year-old kid and a 25-year-old “professional masseur” escape without comment, did you? The story, which the New York Times broke on Thursday, revealed how AEY, Inc., the company run by 22-year-old Efraim Diveroli and his massage therapist friend, was paid hundreds of millions of dollars by the United States Government to supply sub-standard ammunition to Afghan forces. Some of the ammo supplied by AEY is alleged to have been up to 40-years-old, i.e., manufactured before the AEY executives were even born.

There is at least one export law angle to the story. It arises from the discovery that some of the ammunition delivered by AEY had been procured from China. The Times story noted:

Tens of millions of the rifle and machine-gun cartridges were manufactured in China, making their procurement a possible violation of American law.

I’d say that’s more than a “possible” violation. When AEY arranged the export of ammunition from China to Afghanistan it would have been acting as a broker under Part 129 of the International Traffic in Arms Regulations (the “ITAR”). Section 129.5 of the ITAR notes that “no brokering proposals involving any country referred to in § 126.1,” e.g. China, “may be carried out by any person without first obtaining the written approval of” the Department of State’s Directorate of Defense Trade Controls. And we know that AEY would not have had such written approval because section 126.1 says that it is the policy of DDTC to deny licenses involving China.


http://edition.cnn.com/2008/US/03/28/arms.dealer/?iref=mpstoryview

Diveroli is president of AEY Inc., a South Florida company which, according to U.S. government documents, has done more than $10 million of business with the U.S. government since 2004

He's a genius about anything to do with weapons," the 72-year-old says. "Ever since he was a little boy, I would take him to gun shows and he could identify every model of guns. People would ask: How can he do that so young? He has a gift, I would tell them.''

Michael Diveroli, Efraim's father, told CNN affiliate WFOR-TV that he wished his son had turned his intellect elsewhere.

He said Efraim was "a boy genius" who is "hard to control." Read the WFOR story

"I would prefer he became a nice Jewish doctor or lawyer rather than an arms dealer," WFOR quoted Michael Diveroli as saying. Watch how father says son runs his own show »

For now, relatives say Efraim Diveroli is out of the country. CNN attempts to contact him have not been successful.



http://www.lindsayfincher.com/2008/03/aey_inc_wtf.html



And that's not their only federal contract!

As Efraim Diveroli arrived in Miami Beach, AEY was transforming itself by aggressively seeking security-related contracts.
It won a $126,000 award for ammunition for the Special Forces; AEY also provided ammunition or equipment in 2004 to the Department of Energy, the Environmental Protection Agency, the Transportation Security Administration and the State Department.

By 2005, when Mr. Diveroli became AEY’s president at age 19, the company was bidding across a spectrum of government agencies and providing paramilitary equipment — weapons, helmets, ballistic vests, bomb suits, batteries and chargers for X-ray machines — for American aid to Pakistan, Bolivia and elsewhere.

It was also providing supplies to the American military in Iraq, where its business included a $5.7 million contract for rifles for Iraqi forces.

Two federal officials involved in contracting in Baghdad said AEY quickly developed a bad reputation. “They weren’t reliable, or if they did come through, they did after many excuses,” said one of them, who asked that his name be withheld because he was not authorized to speak with reporters.



Arms Dealing Company Was Listed As ‘Minority-Owned’


http://www.thejewishweek.com/viewArticle/c37_a7197/News/National.html


As the government investigation was started, the House Oversight and Government Reform Committee launched its own inquiry into the arms shipments. A spokeswoman for Rep. Henry Waxman (D-Calif.), the committee chair, said invitations to appear before the committee April 17 had been sent to Diveroli, Packouz, the company’s vice president, and Levi Meyer, its general manager.


Dudes, is everyone who works on these government contracts completely high? Is it too much to ask that you actually investigate who you will be handing out $300 million contracts to?!




March 27.2008
Mr. Efraim E. Diveroli
President
AEY Incorporated
975 Arthtx Godfrey Road, Suite 2l I
Miami Beach, FL 33140-3341
Dear Mr. Diveroli:
Today's New York Times raises questions about your company's contracts with the U.S.
government to provide weapons, ammunition, and munitions to military forces in Iraq and
Afghanistan.' I am writing to request your testimony at a hearing on these matters before the
Oversight Committee at 10:00 a.m. on April17,2008, in Room 2157 of the Rayburn House
Office Building.
At the hearing, please be prepared to discuss your company's financial history, past
performance, and compliance with U.S. law and government contracting regulations. The
Committee will be sending you under separate cover a request for documents relating to this
issue. In addition, I request that you make yourself available for a transcribed interview with
Committee staff on or before April 11, 2008.
The Committee on Oversight and Govemment Reform is the principal oversight
committee in the House of Representatives and has broad oversight jurisdiction as set forth in
House Rule X. Information for witnesses appearing before the Committee is contained in the
enclosed'Witness Information Sheet. Also enclosed with this letter are the Committee's
procedures for transcribed interviews.
' Supplier Under Scrutiny on Aging Arms for Afghans, New York Times (Mar. 27,2008)
(online at www.nytimes.com/2008103l27lworldlasia/27ammo.html?_r:1&hp&ore Èslogin).
Mr. Efraim E. Diveroli
March 27,2008
Page2
Ifyou have any questions regarding this request, please contact Theodore Chuang or
Suzanne Renaud with the Committee staff at [phone].
Sincerelv.

Henry A. Waxman
Chairman
Enclosures
cc: Tom Davis
Ranking Minority Member



Is he competition for Erik Prince, Brent Wilkes?


http://tpmmuckraker.talkingpointsmemo.com/2008/03/todays_must_read_304.php


Botach Tactical and AEY Inc., family arms dealerships


http://majikthise.typepad.com/majikthise_/2008/03/botach-tactic-1.html


http://www.botachtactical.com /


Botach Tactical doesn't advertise guns or explosives on its Yahoo-hosted website, but they will sell you plastic training guns and real magazines. Body bags, too. (Before you whip out your credit cards, be advised that Botach seems to have a lot of bitterly dissatisfied customers.)


In 2005 Rep. Maxine Waters (D-Ca) and some of her constituents confronted Botach at his at unmarked establishment at 3423 W. 43rd Place in Los Angeles. Local residents and city officials became concerned when they found out that Botach had quietly converted a former pawn shop into a gun dealership 12 years earlier. Botach has many other business interests in California, including Botach Management, also at 3423 W. 43rd Place, and a cold storage warehouse around the corner from his tactical store/gun dealership/property management company.

[KoKo]

8. Do you have LINKS to what was posted on DU? Didn't see it and Josh scrubbed his

morning report where he had links to the NYT's Story, Waxman's Hearings and his OWN REPORTER. Unless my "Firefox Browser" is giving me crap....Josh scrubbed it and the comments that were interesting on the site and I had to go to Raw Story.

Did you see the You Tube of this "kid" talking to the Arms Dealer? This morning it linked to a Japanese Site ...but by this afternoon the whole thing was translated and no longer had Japanese writing as link.

What's going on with this? I kept checking on DU when I had time today figuring this story would be on DU FRONT PAGE...and there was NOTHING...

Why has it died? Or, if you have links, I'd like to see them since I couldn't be on DU all day and maybe folks just aren't interested so the artcles went to DU Archives. :shrug:

I can't understand why Josh Scrubbed this since it was his main feature this Morning...then it's gone and it's Hillary/Obama Wars later today. I felt that I'd gone down the "rabbit hole."

[seafan]

6. More info when it first broke:

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


IMHO, there is much more in the periphery to be fleshed out about this punk and his *contacts*.

[seemslikeadream]

7. I tried to do that but ..........

[KoKo]

9. huh?

[seemslikeadream]

10. look at the link in my above post

notice how many (53) deletes there are, this one
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=125&topic_id=199949&mesg_id=199949


and here's the other posts on it
http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=389&topic_id=3103499
http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=389&topic_id=3092661

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=389&topic_id=3104326

[KoKo]

13. Thanks....

I understand now...

[seemslikeadream]

14. This is a big story K

he got a minority contract but he ain't no minority, who gave it to him?

[KoKo]

17. It's only a big story if it

can be followed up on though....:shrug: So far...it's not looking good for that...except more bloviating hearings.

[seemslikeadream]

16. coding error

:rofl:


http://www.govexec.com/story_page.cfm?articleid=39714&dcn=todaysnews

[KoKo]

19. The Defense Department did not respond to requests for comment.

at the end of the article! :rofl: Coding Error!

[seemslikeadream]

21. Kinda like those nuke triggers to Taiwan

:rofl:

[seemslikeadream]

11. Waxman is having hearing on him April 17

[KoKo]

15. Apparently....the partner..."Massage Therapist" ...wants immunity to testify...

:eyes:

And Raw Story has the photo of their new site. "PORN BABES FOR AMMO!" (you've probably already searched it) but just linking to Raw's article comes up with their "New Enterprise."

[seemslikeadream]

18. OMG!! I thought you were kidding me

[KoKo]

20. Thanks for the "screen capture" on that one...

Always helps to have tech friendly help. :D Pretty amazing isn't it...:eyes:

[KoKo]

25. BTW...the comments there on that CNN Site..

are an interesting read, too.

[KoKo]

12. Here's an interesting comment from a Commenter on Josh's Site before Scrubbing...

Here's what I copied before Josh's Reporters link was scrubbed:

---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

[seemslikeadream]

22. You tube vid

http://www.youtube.com/watch?v=fV0xTuebILA

http://www.youtube.com/watch?v=b4MCOTQCm0g

[KoKo]

24. Amazing! Father is a Poster Parent for "Do You Know What Your Genius Children are Doing?"

AYYYYYYYY! Amazing watch...given what those kids were doing with fake drivers license and the rest.

Dammit...I went it to the wrong business when I was 17 or 18... :eyes:

[KoKo]

27. Comments on that CNN Site are an interesting read, too. n/t

[seemslikeadream]

23. What the fuck is this??

http://www.youtube.com/watch?v=O4kxSpIBago

http://www.youtube.com/watch?v=b4MCOTQCm0g

[KoKo]

26. It's incredible what Japanes Websites do for You Tube...

when there's info that needs to get out...ain't it? :D Just an amazing recorded conversation. TAP PHONE...for GOOD STUFF!

Where is Francis Ford Coppola when you NEED HIM!

[seemslikeadream]

29. FUN STUFF

http://albaniantimes.blogspot.com/2007/12/albania-to-donate-excess-army.html

TIRANA, Albania: Albania wants to donate its surplus ammunition to Iraq and Afghanistan to help those countries build up their armed forces, Defense Minister Fatmir Mediu said Wednesday.
Mediu said he asked "Washington and other NATO member countries to consider" Albania's offer. The impoverished Balkan country's army has already destroyed some 46,000 of tons of ammunition and is continuing the process as part of a program to scrap excess weaponry by 2010.
"The Albanian government would be ready to give as aid the excess ammunition so that it may be efficiently used in those countries like Iraq and Afghanistan trying to build their armed forces for peace and stability," said Mediu.
An estimated 839 million rounds of ammunition were looted from Albanian army depots in 1997, when citizens enraged over losing their life savings in bogus pyramid investment schemes stormed army barracks.
The government since has collected much of that, though some is still believed to have remained in people's homes.
Albania, a small, predominantly Muslim nation on the Adriatic that hopes to join NATO next year, also has deployed small army units to Bosnia, Afghanistan and Iraq.



http://www.defenseindustrydaily.com/298m-to-aey-for-ammo-in-afghanistan-03152/
Small business qualifier AEY Inc. in Miami Beach, FL received a delivery order amount of $48.7 million as part of a $298 million firm-fixed-price contract for various ammunition for the Afghanistan Security Forces. AEY, Inc. was established in 1999; unsurprisingly, Craigslist says they’re hiring.
Work will be performed in Miami, FL and is expected to be complete by Dec. 30, 2008. Bids were solicited via the World Wide Web on July 28, 2007, and 10 bids were received by the U.S. Army Sustainment Command in Rock Island, IL (W52P1J-07-D-0004).
Ammunition and weapon shortages been an reported issue in Afghanistan, where police and other security forces trainees have been forced to use fake wooden rifles at times.




The Hon. Theodori Sollaku
Attorney General
Republic of Albania
Tirana, Albania

Your Honor:

I have been in communication with Mr. Kosta Trebicka, the President of Xhoi, Ltd., about his allegations concerning a U.S. government contract to purchase ammunition for shipment to Afghanistan and the portion of this contract that is being supplied with ammunition from Albania's surplus stockpiles. Mr. Trebicka informed me that he served as a sub-contractor on this transaction; therefore, this has given him the opportunity to interface with various parties to this deal including the President of AEY, the U.S.-based contractor. Although I am not in a position to verify all of Mr. Trebicka's claims, the information he has supplied appears serious enough to bring this matter to your attention for further investigation. Information and allegations about this matter follow.

AEY Inc., a Miami-based company, is in the scrap metal/recycling business and also maintains an ATF license enabling it to transact business in firearms and ammunition. The president of AEY is Efraim Diveroli who I believe is a U.S. citizen. AEY was recently awarded a $300 million contract by the U.S. government to supply munitions for the Afghan army (http://www.defenseindustrydaily.com/298m-to-aey-fo... and attached is a copy of part of the purchase order that I received from Mr. Trebicka.

As background, due to the history of Russian involvement in Afghanistan, the Afghan military is still heavily dependent on Russian designed arms. For instance, the Afghan army uses AK-47s that obviously require Russian ammunition, and a portion of AEY's contract is being sourced from surplus ammunition in Albanian stockpiles. It is my understanding these stockpiles were originally manufactured in China to Russian specifications with Chinese marked packaging and given to Albania during the period when there were close ties between China and communist Albania. For this reason, Ephraim Diveroli, AEY's President, contacted Meico (http://www.mod.gov.al/eng/industria/meico.asp), the division of Albania's Ministry of Defense responsible for arms exports, to source all or a portion of its contract in Albania.

According to Mr. Trebicka, upon contacting Ylli Pinari, Meico's Director, Diveroli was informed that the munitions would have to be purchased from Meico's appointed agent, Evdin, a Cyprus-based company that I understand is owned by a Swiss businessman who Mr. Trebicka identified as Henri Tomei (possibly known to Interpol), but I have not confirmed this. It is my understanding Edvin's only role in this transaction was to invoice AEY and in turn pay Meico for the munitions. According to Trebicka, Evdin did not handle the shipment and had no other involvement in the transaction, yet, the price mark-up from Meico to Evdin was almost 100%. Pinari reports to Fatmir Mediu, Albania's Minister of Defense, and perhaps the Evdin relationship is appropriate and has been disclosed by the Albanian government. If not, then there may be a concern that an intermediary is being used as a conduit so that the mark-up in price can be used to compensate government officials which, based on an alleged conversation between Diveroli and Trebicka, could be suspected to include Mediu and Prime Minister Sali Berisha. It should be noted that Trebicka thinks it is possible the entire $300 million contract could be sourced in Albania which, assuming similar metrics, opens the possibility that this deal could result in well over $100 million in pure profit that could be split among Evdin and other parties.

An article from The Telegraph (http://www.telegraph.co.uk/news/main.jhtml?xml=/ne... speculated that the U.S. is helping the Afghan army to stockpile Russian weapons just in case a new administration prompts a U.S. withdrawal from Afghanistan. I am told the deal with Russia never materialized because the U.S. did not want to be seen making military purchases from the Russians, but based on the almost identical size of the AEY contract, the contract that was awarded to AEY looks like it may be serving as the replacement deal.

Because of the Chinese markings and the excessive weight of the old packaging (which would have significantly increased shipping costs to Afghanistan), AEY had to hire a company to repackage the munitions. For this reason, AEY contracted with Xhoi Ltd. (contract attached), an Albanian company engaged in the the packaging business that is owned and operated by Kosta Trebicka. After Xhoi had commenced work on the project, Trebicka had learned, as a result of invoices he reviewed at the American Bank of Albania, that ammunition was being bought by Evdin from Meico for $22 per 1,000 rounds and then sold to AEY for $40/1,000. Upon hearing this, Diveroli became very disturbed because Evdin, a company it appears the Albanian government was requiring him to work with as an intermediary, was adding to the cost of the transaction.

Trebicka claims that Diveroli protested to Pinari about Evdin's forced presence in the deal and the inflated pricing, and he requested an audience with Defense Minister Mediu. According to Trebicka, Diveroli's request was denied, and he was later taken to a meeting with Pinari, Mihal Delijorgji and a third unidentified man, and at that meeting it was supposedly suggested that if Diveroli did not cooperate with Evdin, his contract might be in jeopardy. I understand that Delijorgji is in some circles described as a businessman with ties to Meico, but others have alleged that he has a criminal record in Albania, which you can easily verify. Later, possibly in an attempt to intimidate him, Trebicka informed me that Pinari told him to keep his mouth closed because the unidentified third man was Shkelzen Berisha, the son of Prime Minister Sali Berisha.

According to Trebicka, this episode prompted Diveroli to contact the U.S. Embassy in Tirana, and as a result, a meeting was set up at the Tirana Sheraton that included Diveroli, Trebicka, Robert Newsome, a diplomat in the Embassy, Mr. Meyer, who I believe is the Embassy's military attache, and an Albanian woman who is an Embassy employee . When Diveroli told them his story, supposedly, Newsome told Diveroli he had nothing to worry about, they have excellent relations with the Albanian government, and he promised to discuss the matter with the Ministry of Defense. Trebicka informed me that subsequent to that meeting, Diveroli and he spoke with Newsome by telephone, and Newsome told them he did not want to create any problems with the Albanian government and the Embassy could not interfere. Despite what may be indifference on the part of these Embassy officials, if there is any truth to these claims, those officials have an obligation to report such information to the appropriate U.S. authorities, and if they did not or if the Embassy attempts to suppress this information this may be a violation of various U.S. statutes.

I can tell you from my own experience in my dealings with DOS and our Embassy in Albania (and other USG offices for that matter), that because of Albania's cooperation with bigger picture issues like the war on terror and regional stability, the U.S. government has been all too willing to look the other way when it comes to the corrupt practices of Albanian government officials. A perfect example is the case of former Albanian Prime Minister Fatos Nano who also cooperated with the U.S. by sending troops to Iraq and Afghanistan. Despite the very specific information I provided USG about what I maintain was an illegal bank account held by Nano at Credit Suisse - which was disclosed to me by a Credit Suisse employee - USG refused to act on this information. However, one thing different about this situation is that, in addition to possible corrupt practices by Albanian government officials, it may also involve a scheme to defraud U.S. tax payers because what appears to be an extremely large and unnecessary layer of payment - required as a result of Meico's insertion of Evdin - is being underwritten by the U.S. government.

Below is a copy of an email from Kosta Trebicka that responds to my questions that will give you an outline of the events related to this matter. There are also copies of emails between Trebicka and Diveroli and there is a copy of a May 9 email from Pinari to AEY about an ammunition pickup at Rinas Airport that is also copied to Evdin and Trebicka, thereby establishing a link to Evdin. Also attached are copies of supporting documents I received from Mr. Trebicka including a contract between AEY and Xhoi, a USG purchase order to AEY and a transcript of what Trebicka represents is a telephone conversation between Diveroli and him. Sound files of the conversation recorded by Trebicka are attached, and I am confident that it is Trebicka's voice on the recording; however, I cannot verify Diveroli's voice because I have never spoken with him. Among the statements made by Diveroli (I assume this to be Diveroli based on Trebicka's representations) during this conversation: "Pinari is either a mafia guy or working for the mafia"; "Pinari needs a guy like Henri (Tomei/Evdin) in the middle to take care of him and his buddies"; "this deal kept going higher to the prime minister and his son."

You should be aware that I know Fatmir Mediu, we have had various dealings over the years, and in fall 2006, I publicly accused him of engaging in corrupt practices. A copy of an open letter I sent to Mediu making these allegations can be viewed at this link: www.albca.com/aclis/mo...;sid=1050. This information was also shared with key U.S. officials involved with Albania including DOS, FBI, the CIA and several members of Congress. Mediu made a public show of refuting my claims by appearing on an Albanian TV station to basically say, "I'm not a crook." Despite Mediu's claims that the referenced "gifts" he received have little value and his claim that he gave the watches to a member of the media, to my knowledge, they have never been appraised by an independent, qualified appraiser.

I understand that since the first shipment was completed by AEY with Xhoi handling the packaging, other shipments have been made. It is further my understanding that after the first shipment, Xhoi was squeezed out of the deal and was replaced by Meico with a company controlled by Mr. Delijorgji.

You also should be aware that Mr. Trebicka brought this matter to my attention because, besides having met me in the past, I have been involved in efforts to expose corrupt government officials in both the current and former governments, as you may be aware. I have also exposed improprieties in Albania's telecom sector.

In my opinion, among the issues that should be investigated in conjunction with this matter:

1. Is the U.S. Government being overcharged for the ammunition purchased in Albania? Given the financial support the U.S. government has given to Albania, the Albanian government has an obligation to make sure that it does not take advantage of U.S. taxpayers by overcharging for the ammunition purchased by the U.S. Department of Defense. According to one source, the going rate in Eastern Europe and Russia for surplus ammunition for AK-47s is less than $22 per thousand rounds. If your office confirms wrongdoing, such findings should immediately be turned over to the U.S. Department of Justice, the Inspector General of the U.S. Department of Defense, and the Chairman of the Congressional Oversight Committee.

2. Has Meico appointed Evdin or any other company as an intermediary in this transaction? If so, why? Has the President, Prime Minister, Defense Minister, and/or members of Parliament been made aware of or have they approved this relationship? Does Evdin have any relationship with Fatmir Mediu, Ylli Pinari, Mihal Delijorgji, Sali Berisha or Shkelzen Berisha? In order to confirm if any relationships exist, your office should review wire transfers or other money transfers that may have taken place among MOD, Meico, Evdin, AEY, and possibly some of the individuals who are alleged to be implicated in this affair.

3. Is it Efraim Diveroli's voice on the recording made by Kosta Trebicka? If so, the allegations contained in the recording must be fully investigated and Diveroli should be called for questioning.

4. Your office should meet with Kosta Trebicka to discuss the basis for his allegations.

You should be aware that this information has also been submitted to the U.S. Department of Justice, the Office of the Inspector General of the U.S. Department of Defense and several members of Congress. You should also be aware that XXXXXX (and possibly another major media organization) is investigating arms sales from Eastern European countries (including Albania) to the Middle East, and the first story related to these investigations appeared in XXXXXXXX. You should also be aware that regardless of the objectives of the Department of State, if the allegations contained herein have any basis in fact, there can be no doubt the American and Albanian public would demand full disclosure, and any U.S. or Albanian government officials that may ultimately review this matter should take this into consideration.

Please feel free to contact me if you should have any questions or if I can be of assistance.

Thank you.

Respectfully,
Gary Q. Kokalari

http://www.albca.com/aclis/modules.php?name=News&file=article&sid=1384


http://www.albca.com/aclis/modules.php?name=News&file=article&sid=1389

http://www.albca.com/aclis/modules.php?name=News&file=article&sid=1050


Podcasts/clips of Diveroli conversations.
http://shekulli.com.al/content/?page=20

Transcripts of the Diveroli conversations.
http://www.albca.com/aclis/modules.php?name=News&file=article&sid=1387


http://www.myrtlebeachonline.com/575/story/399692.html

MYRTLE BEACH, S.C. --
The FBI has talked to an ammunition company in Aynor about an explosion earlier this month at a depot in Albania that killed 23 people.
Southern Ammunition president Patrick Henry says federal agents were only looking for background information as the FBI investigates the explosion and possible corruption of illegal arms sales.
Henry says Southern Ammunition subcontracted much of its work to help take apart small-caliber ammunition from the 1950s at the depot.
Henry says all his workers were home by December, three months before the explosion.
Southern Ammunition also sells a variety of commercial and surplus military ammunition

http://www.myrtlebeachonline.com/news/local/story/399201.html

There is no indication that Southern Ammunition Co. Inc., which operates out of a nondescript building in Loris, has done anything illegal.
But an FBI inquiry into a series of deadly explosions this month at an Albanian munitions depot has shed light on the murky network of private businesses that buy, sell and dismantle aging stockpiles of weapons in former communist nations.
Southern Ammunition is one of those companies.
It has been around for more than a decade, operating at a 19-acre site off U.S. 701, but likely has flown under the radar of most Horry County residents.
Southern Ammunition sells a variety of commercial, surplus military and restricted ammunition, according to its Web site, which also touts the company's status as a Foreign Trade Zone.
That status allows firearms dealers to import foreign-made machine guns to Loris, where the weapons can be modified and resold in the United States.
Southern Ammunition also demilitarizes small-caliber ammunition for foreign countries, profiting from the contracted work and the scrap metal that's left over.
It was Southern Ammunition's work in Albania, a country in southern Europe, that caught the FBI's attention.
Patrick Henry, Southern Ammunition's president, said he was contacted by federal investigators last week, but only for background into the FBI's larger inquiry into the Albania explosions.
"We were not involved in anything there at the time of the explosions," Henry told The Sun News last week. "We finished our work on Dec. 8, and all of our guys came home before Christmas."
Southern Ammunition had a government contract to disassemble small-caliber ammunition at the depot, which had a large stockpile of 1950s-era Russian and Chinese artillery.
Southern Ammunition supplied equipment and supervisors, but subcontracted much of the work to an Albanian company called Alba Demil, which was run by a man named Mihal Delijorgji.
The March 15 explosions lasted for hours, killing 23 people, wounding 300 others and destroying more than 400 homes in the village of Gerdec, which is near the nation's capital of Tirana.
Those explosions brought to light allegations of corruption involving Delijorgji, who is reported to have Mafia ties.
Delijorgji was arrested in the days after the explosions and now is in an Albanian prison.
Delijorgji is accused of selling ammunition from the Albanian depot to Miami-based AEY Inc., which had a U.S. government contract to supply arms to Afghan forces fighting the Taliban and al-Qaida.
The Pentagon has suspended its contract with AEY, according to The New York Times, because the Albanian ammunition was of such poor quality that the Afghan army could not use much of it.
Also, some of the ammunition would be illegal for a U.S. company to purchase because it was manufactured in communist China.
AEY, which has no affiliation with Southern Ammunition, denies any wrongdoing.
Henry said he doesn't believe any of the small-caliber ammunition his company was supposed to disassemble made its way through Delijorgji and AEY to the Afghan army.
"But nothing would surprise me now," he said.
Southern Ammunition made its money at the Albania depot by taking the ammunition's brass cartridge cases and selling them as scrap metal.
Henry said he found it odd that Delijorgji's company only turned over about half of the brass cartridges Southern Ammunition was supposed to receive.
"A lot of what they thought was brass turned out to be brass-plated steel," Henry said. "That was the explanation we were given, anyway."
Henry said he agreed to subcontract the work to Delijorgji at the urging of Ylli Pinari, the director of Meico, which is the arms export agency of Albania's Ministry of Defense.
"Pinari told me (Delijorgji) had demilitarized 800 tanks, and it would be a good match because he had done this kind of work before," Henry said.
Pinari also was imprisoned this month, accused of scheming with Delijorgji to sell ammunition from the Albanian depot to AEY.
Henry said he knew of AEY because Southern Ammunition unsuccessfully bid against the Miami company in early 2007 for the contract to supply Afghan troops with ammunition.
Henry said he had no idea AEY had any ties with Delijorgji until a friend told him about The New York Times report on Thursday.
Henry said he last visited the Albanian depot about a week before this month's explosions.
"We still had our equipment there, and we were trying to get that and some other material shipped back" to the United States, he said. "I wasn't there when the explosions happened. I was in Germany by then."
Albania must dismantle its aging ammunition before it can join NATO, something the country hopes to do next month.
There have been allegations in foreign news reports that Alba Demil used untrained personnel, including women and children, to disassemble the ammunition at Gerdec.
Henry said he is not aware of any untrained personnel doing work for Southern Ammunition's contract. Alba Demil also had a separate, unrelated contract to demilitarize large-caliber ammunition at the depot.
Such work accounts for billions of dollars - both legitimate and black-market - in former communist countries eager to get rid of dangerous and deteriorating Soviet weaponry and ammunition.
And most of that work, including Southern Ammunition's, goes unnoticed by the general public.

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