Report: 22-year-old arms dealer to plead guilty to fraud charges

[sabra]

Source: USA Today/AP

A 22-year-old arms dealer will plead guilty to charges that he defrauded the U.S. government by shipping Chinese-made ammunition to Afghanistan and then trying to hide its country of origin from military officials, the Associated Press says.

Efraim Diveroli, the CEO of AEY Inc., is due in court today, the wire service says.

Read more: http://blogs.usatoday.com/ondeadline/2008/07/report-22-year.html

[americanyouth]

1. I we've spent millions to destroy this stoc, why does it still exist?

[sabra]

2. Update: Fla. Man Charged In Weapons Case Fails To Show For Arraignment

http://www.local10.com/news/16809743/detail.html

MIAMI -- A Miami Beach entrepreneur scheduled to enter a plea to charges of defrauding the U.S. government by allegedly falsifying the origins and age of ammunition intended for Afghanistan did not show up for his 10:30 a.m. arraignment Monday.

The judge gave 22-year-old Efraim Diveroli until 1:30 p.m. to appear, otherwise he may send the marshals to arrest him.

Diveroli's company had a contract to supply the U.S. military with ammunition for forces in Afghanistan. He has been charged, along with three others, with providing prohibited Chinese-made ammunition and saying it came from Albania.

AEY Inc. was paid more than $10 million for 35 shipments of ammunition. Prosecutors contend his company removed markings from containers to hide the fact they were manufactured in China.

[dysfunctional press]

3. i'm guessing those marshalls are going to have to find him first.

did they at least confiscate some of his passports?

[struggle4progress]

4. Weapons dealer pleads not guilty to procurement fraud

Howard Srebnick, Diveroli's attorney .... argued that the Pentagon knew the source of the ammunition and is deliberately misconstruing the regulations to avoid fulfilling the terms of the contract. The Defense Department has halted all shipments from AEY and suspended the company from receiving additional payments ...

An investigation by Government Executive in April showed that the company had been improperly designated as a small disadvantaged business less than a year before receiving the massive arms contract. Since that label was applied, AEY has earned more than $204 million in federal contracts.

Small Business Administration officials said they have no record of AEY ever applying for or receiving an SDB solicitation. But, in a May letter to Sen. John Kerry, D-Mass., chairman of the Senate Small Business and Entrepreneurship Committee, the agency acknowledged that AEY did classify itself as a small disadvantaged business on its certification and representation forms ...

A committee source, speaking on background, said larger questions persist, such as how the small disadvantaged business label could be mistakenly applied to dozens of contracts without it being caught by agency officials. Kerry is considering holding a hearing in the coming months about issues related to contracting oversight, including the AEY case, the source said ...

http://www.govexec.com/dailyfed/0708/070808rb1.htm

[struggle4progress]

5. Earlier LBN thread: Waxman probes potential embassy cover-up (23 Jun)

Source: The Hill
Posted: 06/23/08 11:22 AM

A House panel is seeking answers from the State Department on whether U.S. embassy officials in Albania were involved in helping an indicted weapons dealer conceal the Chinese origin of ammunition sent to Afghanistan ...

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=102&topic_id=3364068#3364150

[struggle4progress]

6. " ... Diveroli sent several e-mails to the State Department asking if Chinese-manufactured

ammunition could be used to fulfill their contract. Diveroli said the ammunition had been in the hands of an Albanian company for more than 20 years. State officials told Diveroli that the transaction could not be authorized without a national security waiver from the president ..."

Feds charge 22-year-old Pentagon contractor with procurement fraud
By Elizabeth Newell and Robert Brodsky
June 23, 2008
http://www.govexec.com/story_page.cfm?articleid=40306&dcn=todaysnews

Can't without a special presidential waiver -- but then the US ambassador lends a hand