Oversight Hearing on AEY Announced

Posted on by Jesse Lee

From the Oversight Committee:

Oversight Committee Announces Hearing on Arms Contract

WASHINGTON, DC — Today Chairman Henry A. Waxman announced that the Oversight Committee will hold a hearing on Thursday, April 17, 2008, to examine federal contracts awarded to AEY Inc. to supply weapons, ammunitions, and munitions to military forces in Iraq and Afghanistan.

According to the New York Times, AEY was awarded a contract worth nearly $300 million, but provided defective, unreliable ammunition, including shipments of Chinese ammunition, to Afghanistan's army and police forces. The hearing will examine the company's financial history, past performance, and compliance with U.S. law and government contracting regulations as well as the federal government's efforts to investigate allegations that AEY may have violated U.S. law and government contracting regulations.

The following individuals are invited to testify:

· Efraim E. Diveroli, President, AEY Inc.
· David M. Packouz, Vice President, AEY Inc.
· Levi Meyer, General Manager, AEY Inc.
· Senior Official, Department of Defense
· Senior Official, Department of State

· Letter to Efraim E. Diveroli (pdf)
· Letter to David M. Packouz (pdf)
· Letter to Levi Meyer (pdf)
· Letter to Secretary Gates (pdf)
· Letter to Secretary Rice (pdf)

Supplier Under Scrutiny on Aging Arms for Afghans
C. J. Chivers, Eric Schmitt, Nicholas Wood and Mr. Chivers – New York Times, March 15, 2008

Since 2006, when the insurgency in Afghanistan sharply intensified, the Afghan government has been dependent on American logistics and military support in the war against Al Qaeda and the Taliban.

But to arm the Afghan forces that it hopes will lead this fight, the American military has relied since early last year on a fledgling company led by a 22-year-old man whose vice president was a licensed masseur.

With the award last January of a federal contract worth as much as nearly $300 million, the company, AEY Inc., which operates out of an unmarked office in Miami Beach, became the main supplier of munitions to Afghanistan's army and police forces.

Since then, the company has provided ammunition that is more than 40 years old and in decomposing packaging, according to an examination of the munitions by The New York Times and interviews with American and Afghan officials. Much of the ammunition comes from the aging stockpiles of the old Communist bloc, including stockpiles that the State Department and NATO have determined to be unreliable and obsolete, and have spent millions of dollars to have destroyed.

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