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AEY And Albanian Supplier Were On State Department Watchlist
Arms dealer AEY Inc. and its 22-year-old president have been on the U.S. State Department's Arms Trafficking Watchlist for years.
But that didn't keep them from landing a nearly $300 million Pentagon contract providing ammo to the Afghan Army.
AEY is getting a lot of scrutiny since its 22-year-old president and three others from the firm were indicted last week and accused of providing useless and illegal Chinese-made ammunition under a U.S. government contract.
At a hearing on Capitol Hill today, Stephen D. Mull, Acting Assistant Secretary of State at the bureau of Political Military Affairs, said AEY Inc. was placed on the watchlist in January 2005. AEY's president, Efraim Diveroli, was individually placed on the list in 2006, Mull said. They were placed on the list for reasons that remain classified, officials said.
AEY was awarded the $300 million Afghanistan contract in January 2007.
Military officials stammered to explain how the massive deal sailed through the Army's contracting system without any red flags.
"The contracting officers that execute the contracts are not required to go and look at the watchlist," said Brigadier General William N. Phillips, U.S. Army, Commanding General at Picatinny Arsenal and head of the Joint Munitions and Lethality Life Cycle Management Command, told the committee
Jeffrey Parsons, Executive Director of the Army Contracting Command said: "I'm not sure whether that watch list is accessible to people outside the State Department."
Lawmakers also asked questions about the Albanian arms dealer who AEY who sold the ammo to AEY.
His name was Ylli Pinari. He was president of the Military Export Import Company of Albania (MEICO) in Albania. And he was placed on a U.S. State Department Arms Trafficking Watchlist back in 2005. The reasons for putting him on the watchlist are also classified.
The purpose of the watchlist is to identify people and companies who "might be unreliable recipients of defense articles and services licensed by the State Department."
Rep. Stephen F. Lynch, (D-MA) described the situation as "a disgrace"
"This kid was 19 years old and he got a $300 million contract," Lynch said. "Has anybody been fired for this? Can I ask the panel: Has anybody gotten their walking papers for this?
No, Parsons replied, nobody's been fired over the AEY investigation.
When a certain political movement denigrates intellect and merit , hires and fires based on partisan loyalty over competence and lionises the most brutal , heartless and compassion-free among us to high office and departments of vital responsibility, we should not be surprised when incurious, unengaged dolts turn up ruining everything.Blundering is in the design.
I find myself wondering what part or department of the federal infrastructure they GOP under GWB hasn't entirely driven into a reef, ditch, or off a cliff . And I sometimes think it's intentional so Grover Norquist can claim Government just can't work .
Bug or Feature ?
June 24, 2008 1:48 PM | Reply | Permalink
is the watchlist referred to in the article the same as the no-fly list (i.e. the "persons of interest" list that law firms are required to check before accepting clients who might be involved with international trade)? because the no-fly list is not so super secret, AEB that fact that law firms use it.
or am i missing something? in any case, if the watchlist is so classified that no one who needs it can see it, what effing good is it?
June 24, 2008 1:58 PM | Reply | Permalink
The real story is the money. 300 million, well if Efram does not have a nice house, nice car, and a really, really, really, nice boat...he did not get the 300 mil..someone else got the money.
June 24, 2008 2:01 PM | Reply | Permalink
War profiteering, baby. That's what this entire war was about. So-called true Americans, and so-called patriots think absolutely nothing about fleecing the taxpayer for hundreds of millions of dollars.
How many billions of dollars have gone missing? Why does the Bush WH continue to make it difficult to get hearings on these matters?
Halliburton, KBR, Blackwater, all getting fat, no bid contracts with no oversight and not one damn peep from anyone.
George Carlin was right, this country is finished.
June 24, 2008 2:04 PM | Reply | Permalink
Just some more or less random thoughts on this deal.
Contract awarded in January 2007 - So if Congressional interference was involved, this would have been a last gasp from the Republican Congress. (Assuming some lag time from the interference and the final awarding of the contract.)
My first suspicion would be one of the members of the military oversight committees. Maybe someone with strong Israeli connections because of the family involved. But it could also have been someone on Intelligence oversight, also. Or maybe controlled by someone way up in the government like Ollie North, but more sophisticated?
Then considering that the kid was supplying cheap junk for $300,000,000 it seems that the profit should have been very high. Where did the money go? Was it used to fund some off-the-books spook project? While at first glance it seems like simply corruption, it had to come out of or at least through the Pentagon purchasing process, and no 22 year-old is going to ever know enough from outside that bag of worms to manipulate it. And how did they get the State Department in Albania to grease the deal out there? That's too many moving parts to coordinate to be done by any contractor outside the government. It's clearly an inside job.
So where did the excess money go? That seems to me to be the most likely reason for the whole scam.
Is someone throwing Efraim Diveroli to the wolves as part of the cover-up?
June 24, 2008 2:07 PM | Reply | Permalink
I can't help but be reminded of Barry Minkow of ZZZZ-Best fame who also started young and ended up in federal prison for fraud (wikipedia). Minkow's carpet cleaning business was found to be funded by organized crime which also used it as a vehicle for money laundering.
June 24, 2008 2:07 PM | Reply | Permalink
I find the absurdity of this story as amusing/outrageous as anyone, but I have a pretty serious question here:
When is young Master Diveroli having his ass thrown in a cell in Guantanamo or "renditioned" off to Egypt?
If anyone has given "aid and comfort" to al Qaeda, it's he. He knowingly sold defective armaments to the US, knowing they'd be used if not by the US military then surely by members of the coalition fighting al Qaeda and the Taliban in Afghanistan.
They keep a Uighur in Guantanamo for six years, and a kid like this threatening the safety of soldiers in Afghanistan. Does the horrible absurdity of this administration ever end?
June 24, 2008 2:13 PM | Reply | Permalink
Kid looks seriously baked in both pictures.
June 24, 2008 2:50 PM | Reply | Permalink
I'd kind of like to understand the family. His grandfather is Angelo Diveroli, who took him to gun shows when he was a child. His father was Michael Diveroli, who owns AEY. Efraim took a 1 % stake in 2004 before taking it over in 2005 (roughly.) Diveroli's extended family reportedly owns several arms businesses in California and Florida.
Steve Sailer has more, linking him back to his maternal grandfather Yoav Boteach (and Michael Jackson.)
Who's that international arms dealer all TMP scandals eventually get linked to? He probably knows Yoav Boteach.
June 24, 2008 2:52 PM | Reply | Permalink
Thomas Kontogiannis, I was thinking of. So, six degrees of Thomas Kontogiannis? At the risk of sounding like David Horowitz, how's he connected to Yoav Boteach?
June 24, 2008 7:21 PM | Reply | Permalink
ARG!!
July 24, 2008 11:12 AM | Reply | Permalink