Arms and the Dudes

The Book of the Week is “Arms and the Dudes, How Three Stoners From Miami Beach Became the Most Unlikely Gunrunners in History” by Guy Lawson, published in 2015.

In summer 2004, when he was eighteen years old, the Orthodox-Jewish high school dropout, pothead and pathological liar Efraim Diveroli became passionate about the lucrative field of supplying firearms to the U.S. military. He had been mentored by his father and uncle on contracting with the U.S. government, through their businesses. There was one particular website where he could see all the needs for weaponry for the wars in Afghanistan and Iraq.

Diveroli worked around the clock combing the website’s classified ads for competitive-bidding contracts he thought he could win, and making phone calls to contacts he made to find suppliers from whom to purchase arms, to sell and deliver, via planes and / or trucks to the U.S. military on-location. He also needed lenders to finance the deals, as he had to make down-payments of tens of thousands of dollars he didn’t have, when he was finally awarded a bid.

In early 2005, the battles in Iraq between Shiites and Sunnis became even more fierce, resulting in more roadside bombings, kidnappings, sniper incidents and ambushes. Thus, there occurred an increase in demand for rocket-propelled grenades, AK-47’s (or their equivalents; the whole world was already full of them– but apparently still not full enough), ammunition for them, and missiles.

This resulted in an even bigger spike in the number of bribes, kickbacks and Swiss bank accounts among war profiteers. Diveroli also benefited from the high turnover of inexperienced procurement officers in Iraq. Every few years, he attended war-weaponry trade shows, such as Eurosatory in 2006 in Paris, and the International Defence Exhibition and Conference in 2007 in Abu Dhabi.

The State Department rated resellers such as Diveroli pursuant to their reputations for satisfaction in completing contracts, similar to the way eBay does. Eventually, the Department allegedly compiled a “watch list” of resellers (which included a lot of offshore and shell companies) with whom the Department was supposed to exercise caution in doing business. Diveroli’s company’s name (AEY) was on that list, but background checks were (accidentally-on-purpose) sloppy or non-existent, because the shortages of weaponry and ammunition in Afghanistan were so severe.

Unsurprisingly, there was inter-agency rivalry between the State Department and Defense Department (run by the bureaucrats in the Pentagon). When Congress authorized the establishment of the Department of Homeland Security through a long, complicated document, one little phrase gave the Defense Department unlimited powers: “Notwithstanding any other provision of law.”

To boot, the Pentagon used its new hegemony to wreak capricious vengeance on people who gave it bad publicity for its misdeeds and embarrassed it; there was no honor among thieves in the cut-throat war-weaponry business. One specific overzealous individual at yet another agency, the Defense Criminal Investigative Service (DCIS), helped with the Pentagon’s dirty work.

In May 2007, the main plot of a suspenseful saga started when Diveroli’s two friends (also only in their twenties) from grade-school assisted him with a $300 million (!) contract (that had an interesting origin) with the Department of Defense.

Unfortunately, the trio encountered numerous obstacles in trying to complete the contract and get their money. For one, the shipment of arms and ammunition that was supposed to go from Albania to Kabul was held up at an airport in Kyrgyzstan on a legal technicality. Two, an irresponsible article in the New York Times completely botched up the real story, prompting the Department of Justice to get involved.

Read the book to learn the rest, and what became of the participants (which included a wayward Albanian official, and an Albanian-American investment banker, among other pesky characters).