Efraim Diveroli Indicted

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MIAMI, June 20, 2008 /PRNewswire-USNewswire via COMTEX/ ----AEY Inc. (AEY: 3.14, +0.07, +2.28%), Efraim Diveroli, David Packouz, Alexander Podrizki and Ralph Merrill were indicted today by a federal grand jury in Miami on wide-ranging fraud charges in connection with their provision of ammunition to Afghanistan, announced R. Alexander Acosta, U.S. Attorney for the Southern District of Florida; Sharon Woods, Director, U.S. Department of Defense (DoD), Defense Criminal Investigative Service; Anthony V. Mangione, Special Agent-in-Charge, U.S. Immigration and Customs Enforcement (ICE: 128.62, -1.06, -0.81%), Office of Investigations in Miami; Brigadier General Rodney Johnson, Commanding General, U.S. Army Criminal Investigation Command; and Paul Phillips, Regional Director, Defense Contract Audit Agency.

Count one of the indictment charged all defendants with conspiracy to defraud the U.S. by making false representations to the government and by conspiring to commit procurement fraud. Counts 2 through 36 charge defendants AEY and Efraim Diveroli with making false statements to the U.S. Army regarding the country of origin of the ammunition. Lastly, all defendants are charged with procurement fraud.

As alleged in the indictment, AEY is a munitions supplier, with offices in Miami Beach, Fla. Defendant Efraim Diveroli is the president of AEY and manages and directs the business operations of the company. Defendant David Packouz was a director and vice president of AEY; defendant Alexander Podrizki was an agent of AEY stationed in Tirana, Albania; and defendant Ralph Merrill was a business associate of Diveroli who provided financial and managerial assistance to AEY.