Diveroli pleads guilty

MIAMI, Aug 31 – Efraim Diveroli, 23, admitted in a plea agreement that he conspired with other employees of his company to sell the military $10.3 million of prohibited Chinese munitions.
Diveroli was accused in a scheme to illegally ship nearly $300 million in Chinese-made ammunition to Afghan soldiers has agreed to a plea deal that could send him to prison for up to five years.
Under the deal, prosecutors will drop 84 counts of wrongdoing in exchange for 23-year-old Efraim Diveroli pleading guilty to a conspiracy charge. He could also be fined up to $250,000.
Diveroli was president and owner of AEY Inc., the Miami Beach firm awarded a $298 million U.S. Army contract in 2007 to provide the ammunition to Afghanistan. The contract forbade exporting Chinese ammunition, but prosecutors say the company did it anyway and claimed the rounds were from Albania.
AEY bought much of the ammunition from Albania’s Military Export and Import Co., which had purchased huge amounts of Chinese ammunition from 1958 to 1974. In 2007, the State Department e-mailed the young Miami Beach munitions dealer to tell him that he could not sell Chinese weaponry to the U.S. government to help supply allied forces in Afghanistan, according to an indictment.
But Diveroli, president of AEY, and three of his employees didn’t take no for an answer, prosecutors said. They even arranged to have “Made in China” markings removed from the wooden crates shipped to Afghanistan to conceal the origins of the weaponry, prosecutors said in court papers.
After they devised a way to conceal the true origins of the 90 million machine-gun rounds, Diveroli and his employees used “this issue” as leverage to secure a lower price for the munitions from its subcontractor and Albania’s Military Export and Import Co., Assistant U.S. Attorneys James Koukios and Eloisa Delgado Fernandez said.
By providing ammunition made in China, instead of Albania, AEY derived excess profits of about $360,000 from the government, the prosecutors said.
Authorities say AEY then repackaged it to remove all traces of the Chinese manufacturer and provided the Army with written certification that the ammunition had come from Albania.
The case was sparked after the New York Times made a long report last year following the blast in Gerdec, near the capital, Tirana, at a private ammunition disposal factory which killed 26, injured about 300 and damaged or destroyed up to 5,000 buildings in the area.
Former Defense Minister Fatmir Mediu, other top civilian and military officials and private company managers, in total 29, are on trial accused of abuse of post and some also of mass murder.
AEY has been suspended from future contracting with any U.S. government agency but is still listed as an active company with the Florida Secretary of State.
Two other AEY employees, David Packouz and Alexander Podrizki, have also signed plea deals with the government. A case against a fourth man, Ralph Merrill, is still pending.
Sentencing for Diveroli is scheduled for Nov. 10.