It looks like the adventure of a lifetime: Two gun-dealing stoners bump and grind through Iraq’s so-called Triangle of Death. Crates of Berettas rattle around in the back of their truck; they elude gunfire in Fallujah. Later, with pistols delivered and cash in hand, they return to the States for bong rips, lines of cocaine and hotel hookers.
That’s the way it plays in “War Dogs,” the Hollywood version of a true story involving Miami potheads who earn millions of dollars selling weapons to friendly armies in the Middle East on behalf of the US government. It’s a wild ride of drugs, guns and stacks of Benjamins.
But the real tale looked a little different.
At the center of it all is Efraim Diveroli (played by Jonah Hill), just 18 when the gambit kicked into gear, who learned the weapons business while working with his gun-selling uncle in Los Angeles at age 14. After a spat over money, he returned home to Florida and launched a company called AEY.
“Here I was, dealing with matters of international security, and I was half-baked. I didn’t know anything about the situation in that part of the world.”
- David PackouzDiveroli recruited Hebrew-school chum David Packouz (played by Miles Teller) to handle the logistics of shipping weapons from the Eastern Bloc to the Middle East. Business boomed as the American government contracted them to send Russian-designed machine guns and grenades to allies in the world’s most volatile hot zones.
The real Packouz has explained that Diveroli’s talent as an expert liar made him a natural for arms dealing. Even while high.
“He would be toasted, but you would never know it,” Packouz told Rolling Stone. “He was totally convincing. But if he was about to lose a deal, his voice would start shaking. He would literally cry. I didn’t know if it was psychosis or acting, but he absolutely believed what he was saying.”
Backing AEY was Ralph Merrill, now 73, who invested his life savings with the gun-running stoners.
Merrill and Diveroli met through business in 2003. Back then, Merrill, a Mormon based in Utah, made his living by producing and selling automatic weapons for hobbyists.
“I ordered stuff from [Diveroli’s uncle] and Efraim became my rep,” says Merrill. The movie didn’t touch on that, but everything else about Merrill is pretty much wrong: “[My character is] Jewish, lives in Miami and [is] a dry cleaner.”
In January 2007, Diveroli landed his career-making deal to supply the Afghan army with $298 million worth of gear. Their order included mortar shells, rocket grenades and 93 million rounds of AK-47 ammo.
Though Merrill tells The Post that they got the contract by “coming in at around $50 million below the nearest bidder,” it still promised to make everyone rich.
But complications arose. Most critically, their AK-47 ammunition was manufactured in China, which the government says made it illicit for US-based arms dealers to trade. But a volley of e-mails between AEY and collaborators in Albania ensured that the origins would be masked.
Then came an incident in Kyrgyzstan, where the local government took AEY’s ammo-loaded 747 hostage as it refueled. “It was surreal,” Packouz, a former massage therapist, explained to “War Dogs” author Guy Lawson. “Here I was, dealing with matters of international security, and I was half-baked. I didn’t know anything about the situation in that part of the world.”
Luckily for Packouz, US government reps intervened, and AEY’s coffers bulged with millions of dollars in Pentagon money.
Once air-bound, delivery to Afghanistan was no simple feat. “You had to be a little crazy to get it in there,” says Merrill. ”You could easily get shot down by rocket grenades.”
Merrill says that things unraveled when what he characterizes as “a whisper campaign” launched by an entrenched arms-selling competitor alleged that AEY “was bringing Chinese rifles into Montenegro and replacing the markings with those from the Eastern Bloc.”
It apparently put AEY on the Defense Department’s radar. In August 2007, AEY headquarters was raided and computer hard-drives seized. There was no evidence of gun tampering, but there were plenty of incriminating e-mails about masking the Chinese ammo.
Packouz, Diveroli and Merrill were charged with multiple counts of fraud. Packouz turned state’s evidence, never received his millions from Diveroli, and spent seven months under house arrest. Diveroli copped a plea and negotiated four years in prison. Merrill maintains his innocence — “I didn’t do anything wrong,” he insists, despite a federal indictment having it that he told the Albanians “how to remove Chinese markings from [ammo] containers” — but was found guilty and received a four-year sentence. (He is appealing this.)
Though the movie has a relatively happy ending, in real life things are messier. Merrill estimates that Diveroli has $12 million socked away. He is suing his former partner to recover the $5 million or so that he believes is his due. According to a well-placed source, Packouz anticipates litigating against Diveroli as well. Diveroli is suing nine parties (including director Todd Phillips) involved with “War Dogs” over allegations that include misappropriation of his likeness rights.
Merrill is clearly displeased with his stoner partners: “I wish I never got involved with these guys.”
He fumes over the fact that Diveroli “lives in a condo with a locked gate. He drives his Beamer while I live off Social Security” — Merrill lost his life savings of $1.5 million in the venture. “The world is a cynical place.”
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