The Pentagon is distancing itself from a Miami Beach arms dealer indicted for fraud in connection with its contract to supply ammunition to Afghanistan's security forces. But nobody in charge at the time seemed to care about the red flags that surrounded the business practices of AEY Inc., or the abilities of its 20-something-year-old managers. The Army needs to explain how AEY got the contract, and the State Department needs to answer the question of whether it tried to conceal what could be illegal arms trafficking.
The 22-year-old president of AEY and three other people were charged this month with fraud and conspiracy after allegedly concealing the Chinese origin of ammunition they sold to Afghan security forces. Authorities claim the dealers tried to circumvent U.S. law and provisions in the $298-million Army contract that ban trading in Chinese arms. They say the dealers shipped aged cartridges from Albania to Afghanistan that were actually manufactured in China. A lawyer for the company president has disputed the claims.
What cannot be disputed is that federal officials disregarded serious concerns. A congressional committee investigating the case says senior U.S. embassy officials in Albania may have approved of efforts by the Albanian defense minister "to conceal evidence of illegal shipments" and then "withheld" that information from the committee.
The House Oversight and Government Reform Committee revealed this week that by the time the Army awarded AEY the bid in January 2007, State and Defense officials had flagged at least six earlier contracts for poor quality or performance. Investigators say the firm mishandled some contracts while others may have been unnecessary. The Pentagon did not check AEY officials against the State Department's "watch list" of suspected illegal dealers, and a senior Army contracting official overruled a team of subordinates who raised concerns about awarding AEY work.
The House committee also revealed that a U.S. military attache told investigators the U.S. ambassador endorsed a plan by the Albanian defense minister to conceal the true origin of the Chinese ammunition. The meeting between the two occurred hours before a New York Times reporter was to visit the operation in Albania. The Times later reported that documents showed the Miami company bought and repackaged Chinese cartridges that had been stored for decades. Some of the ammunition was held in decomposed boxes and was corroded, dirty or covered with a film.
The State Department said it expects Ambassador John L. Withers II to be cleared. But it also asked the department's inspector general to investigate the case. These allegations go beyond what the House committee's ranking Republican, Thomas Davis of Virginia, described as "obvious evidence of consistently shoddy performance" on the contractor's part. The Army dropped the ball and the embassy in Albania engaged in questionable conduct. The House should continue its probe and the administration should start providing some answers.