Scamfluencers - Efraim Diveroli and David Packouz: A Farewell to Arms | 213

Episode Date: May 11, 2026

Efraim Diveroli and David Packouz were two Miami Beach stoners with zero military experience and absolutely no background in military procurement – but they had audacity to spare. The childhood friends hustled their way into nearly $300 million in Pentagon contracts, supplying ammunition to the Afghan army. They raked in millions along the way, blowing their profits on bayfront condos, luxury cars, and Miami clubs. But when you build a weapons empire on hustle, bravado, and a lot of weed… sooner or later, someone will notice the smoke.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Audible subscribers can listen to all our episodes of scam influencers ad-free right now. Join Audible today by downloading the Audible app. Sachi, the longer we do the show, do you feel like the world of scammers get smaller? Like, there are characters who do pop in every once in a while in various stories, which is pretty crazy. Yeah, it's like they all go to the same parties and clubs and schools and stay friends forever. It's bananas. Yeah, it's kind of like a scammer extended universe. And it has me thinking, is it all connected?

Are all rich people in the same scammer network? Yes. Yes. Wow, goes all the way to the top, doesn't it? Yep. Well, today we're going to talk about a couple of guys who inspired the actions in a previous story we covered. These two are not criminal masterminds.

They're more like criminal fuck-ups. And like many scammers, they took advantage of an already exploitative industry and somehow, made it worse. It's April 2007, and Alex Padriski is standing inside a crumbling bunker in Albania, staring at a mountain of aging ammunition stacked on wooden pallets. Alex is 24, slim with curly hair, a kid from Miami, who's now halfway across the world working as a point man for an arms dealing company called A-E-Y,

a company that was started by two of his childhood friends from synagogue, Ephraim Diveroli and David Packhouse. Ephraim is the brains of the operation, a bona fide savant when it comes to navigating the weird, complex world of international gun running. David is his right-hand man, a glorified salesman who's hoping this whole thing will make him enough money to pursue his real dream, becoming a rock star.

Alex initially turned down this opportunity. Back when he was a teenager, he thought about joining the army, but he had serious reservations about the war in Iraq. So instead, after the invasion, he went to college and studied international relations and defense. But after graduating, he couldn't find a job. So when David called and said AEY needed a logistics coordinator for a quick two-month gig overseas, Alex heard him out.

The pay was $1,100 a week plus expenses, and it would give him international experience, which might look good on his residence. Alex agreed figuring it couldn't be that hard. If his two pot-smoking friends could do it, so could he. But nothing could have prepared Alex for the problem now in front of him. Here's a situation. Somehow, AEY landed a $300 million contract with the U.S. military to supply them with weapons and ammo.

The contract had a few stipulations about where and what kind of ammo they could provide, notably the goods needed to be, quote, serviceable and safe, and they could not, under any circumstances, be of Chinese origin. Standing in the bunker, Alex can already tell that nothing about this ammo screams serviceable and safe, but that's not even the worst part, because stamped across the steel containers holding the ammunition

are unmistakable Chinese characters. So Alex calls David back in Miami and is like, Dude, you know this is Chinese ammo, right? David's reaction is basically what? And as far as Alex can tell, he sounds genuinely blindsided. So Alex emails him photos, close-ups of the markings, the rusted tins, the whole situation. Then he waits while David and Ephraim scramble for a workaround. At first, they think there might be a loophole, that the ammo might predate the Chinese embargo and could be exempt.

Ephraim even sends a hypothetical inquiry to the State Department. The answer is a resounding no. Unfortunately, there's a bigger problem looming. If AEY misses their shipping deadline, they could lose a contract entirely. And if they default on this contract, they won't just miss out on a $300 million payday. They'll also get a big black mark on their record, which means any chance of winning future government contracts drops to basically zero. They have to hit their deadline. So eventually, David emails Alex and tells him to have the rounds repackaged to remove any Chinese markings.

That means taking the ammo out of the rusted tins and putting it into new containers for shipping. Alex doesn't love this plan, but he trusts David, and he wants to keep this contract alive, so he gets to work. This sounds so bad from that. the beginning, this sounds like a bad plan. These sound like maybe bad people. And I do not think anybody is smart enough to pull this off, which I think a lot of times on this show, but especially today. Yeah, there's actually no good detail in this at all. Nothing redeemable. And also, Alex isn't from Albania. He doesn't have any context there and doesn't know the local logistics scene. So he goes to the yellow pages and starts flipping through them. Eventually,

he lands on a local listing for a cardboard box manufacturer named Costa Tribesca. They meet in a noisy bar. Costa is a small, serious man with thick hands from years of manual labor. Alex explains that he needs sturdy boxes and a crew to repackage the rounds. Costa nods. No problem, but how much ammo are they talking about? Alex says, 100 million rounds. Costa whistles.

Then he asks why they're going to be. through all this trouble. Alex offers a simple explanation. They want to lighten the load so air freight will be cheaper. Costa nods and doesn't ask any follow-up questions. He agrees to do the job for $280,000. But Costa isn't stupid. It won't take him long to realize that something seriously shady is going on and that Alex, despite his best efforts, isn't way over his head. Meanwhile, back in Miami, Alex's friends Ephraim and David are learning that you can't just wing it in international arm sales forever. For years, these cocky Miami bros have been faking it till they made it. Now, they're scrambling to stay one step ahead of the U.S. government, its enemies, and its allies,

and the other gun runners competing for the same business. Because once you start moving hundreds of millions of rounds of ammunition across the globe, Eventually, someone will start asking questions. And when that happens, their entire operation could come crashing down. From Audible Originals, I'm Sarah Hagee. And I'm Slachi Cole. And this is scam influencers. Ephraim Diveroli and David Packhouse were two Miami Beach stoners with zero military experience

and absolutely no background in government procurement. And yet, they somehow blustered their way into becoming critical suppliers in the U.S. government's war on terror. Their bet was simple. If their bid was cheap enough, the army either wouldn't do serious due diligence on who was supplying the weapons, or they just wouldn't care. And that bet paid off. The two childhood friends raked in millions, living it up in fancy houses, eating at incredible restaurants, and driving expensive cars. They think they've cracked the system.

Bid low, move fast, ask forgiveness later. And for a while, it actually works. But the problem with building a weapons empire on hustle, bravado, and a lot of weed, is that sooner or later, someone notices the smoke. This is Ephraim DiVioreoli and David Packhouse, a farewell to arms. Let's rewind seven years. It's 2000 and 14-year-old Ephraim DiVioli is on a flight back to Miami. He just got expelled for smoking weed on a school retreat, on the Sabbath, no less.

Now he's about to face his mother at the airport. And he knows she's going to lose it. Ephraim's the oldest of five kids in a strict Orthodox Jewish household in Miami Beach. His mom works downtown in an office building and his dad sells police supplies. They make enough to get by, But money is always tight. Ephraim has spent countless nights lying in bed, listening to his parents arguing about money,

and he's sworn to himself he'll never struggle like that. Instead, he wants a life he sees all around Miami, rich kids in designer clothes, getting driven around and their parents' bent leaves. Unfortunately, this dream hasn't exactly inspired him to be a model student. Ephraim has a habit of skipping school, slacking off, and smoking weed. So when he lands back in Miami after getting expelled, his mom is at her breaking point. She calls her successful older brother, B.K. Botak, for advice.

He tells her to send Ephraim to live with him for a while. He'll straighten the kid out. And that's how Ephraim ends up living in south central Los Angeles. I can't think of a better place for a kid who is seemingly determined to get in trouble. Nothing bad happens there for young men and boys. It's a setup that I'd say is pretty common and sometimes works. Who knows? Mm-hmm.

Well, BK is no nonsense and very strict about religious rules. He also runs a company called Botak Tactical, which sells equipment to police departments. The business operates out of an old bank building. Picture concrete walls, steel doors, bulletproof glass, guns, ammo, gas masks, everything. At first, BK puts Ephraim to work start. shocking shelves and selling equipment. Ephraim makes minimum wage and lives in a cramped 700 square foot apartment with two cousins and four former Israeli soldiers who double a salesman.

Even with the location change, and despite his uncle constantly yelling at him about being on the wrong path, Ephraim still finds a way to skirt the rules, including getting high with his cousins. I can't think of an environment better for getting high with your cousins. Of course he's doing that. Yeah, I mean, hey, sharing an apartment with former Israeli soldiers must be, you know, pretty good for him, right? I mean, that would make me want to smoke a joint. But he's also making money for the first time in his life.

And he realizes he loves working. He's pulling 12-hour days for minimum wage. But he already knows he doesn't plan on staying at the bottom of the ladder for long. Eventually, Ephraim graduates from stalking the shelf. to selling equipment. He starts hawking everything from boots to flashlights to glocks. There's just one problem.

No one wants to buy weapons from a teenager. So Ephraim comes up with a solution. On sales calls, he pretends to be a seasoned, 30-something military vet, and somehow buyers believe him. He has genuine talent for sales, and he's obsessed with becoming the best in the biz.

Then 9-11 happens, and business at Botech Tactical takes off. Enough cash is coming in that BK agrees to try a new payment structure for Ephraim. 50% commission, no base pay. BK is convinced Ephraim will fail. Ephraim is certain he won't. So just to be clear, they are betting not only on their own success, but on if other people get bombed a bunch, right?

Well, listen, they're just being realistic. Right, right. You know, as teenagers. Yes, at this point, Ephraim is 16 years old, but he never lets his age slow him down. He throws himself into the world of arm stealing. He scours online classifieds and calls police departments, pitching fully automatic weapons to middle-aged cops, often while he's high as a kite. Then one day, he stumbles on a website called FedBizOps.

It's where the federal government posts open contracts, basically shopping lists for everything the military needs, from toilet paper to grenades. By law, the Pentagon has to publish these contracts publicly, and anyone with the right licenses can submit a bid. Then the military picks a supplier, usually whoever can deliver the goods for the lowest price. When Ephraim sees a listings,

his eyes practically bulge out of his head. There are billions of dollars worth of contracts on the site, If he can land even the tiniest slice of that business, he'd be rich. Luckily for Ephraim, his uncle already has the licenses required to bid, so he pitches BK on a deal. Let him use the gun licenses and the company's financing to bid on the contracts. If he wins, they'll split the profits. Almost immediately, Ephraim starts winning small contracts.

He has a pretty brilliant strategy, go after the small, over-es-year-old. overlooked contracts, then undercut competitors by just a few cents per unit. It works. Then, in March 2003, the United States invades Iraq. Ephraim is glued to CNN, watching soldiers sweep through Saddam Hussein's palaces with M4 rifles and automatic weapons. And he has a revelation. He doesn't want to be a small player anymore.

He wants to be an international gunrunner. What happened to wanting to be in a band? You know, why can't he want to take a weird road trip or sleep with his friend's mom? There are other more interesting ways to want to find oneself. Yeah, but you're forgetting that teen boys really think guns are cool. Oh, oh, right. They're evil. I forgot. Yeah. And unfortunately for Ephraim, his uncle is not down with this. plan. BK. is still trying to make Ephraim follow religious rules, keep kosher, observe the Sabbath,

and stop smoking weed, things that now 17-year-old Ephraim has zero interest in doing. Ephraim tells his uncle to separate business from personal matters, but BK. doesn't appreciate being lectured by his teenage nephew. Their relationship soon implodes. Ephraim claims he's generated more than $1 million in sales and $200,000 in profits for the company, but he says his uncle still owes him $75,000 in commissions. So he demands payment. BK. Lafs him out the room.

So Ephraim quits, but not before spending a week calling up all of his clients and convincing them to keep doing business with him once he's back in Miami. He also claims he collects about 70,000, in outstanding payments and deposit some money straight into his own bank account, which he says isn't stealing because it's money his uncle owes him anyway. With that, Ephraim heads back to Miami to strike out on his own, but he'll soon realize that running an international weapons business is a lot easier with a partner, and before long, he'll find someone who can help him take his business to the next level.

It's a couple of years later. One night towards the end of 2005, David Packhouse steps outside his Miami apartment waiting for a friend. David is 23 with blue eyes and his shaved head. The friend he's waiting for is Ephraim, now 19, who pulls up in a Mercedes. David doesn't usually hang out one-on-one with Ephraim. They mostly know each other through the same group of high school friends. But Ephraim called and invited David to a party, and David figured, why not? The two originally met in high school

where David was just as big of a stoner as Ephraim. The difference is, David managed to avoid getting kicked out of school. After graduating, he spent two semesters at the University of Florida before dropping out to pursue his real dream, being a pop star. He started writing brooding rock ballads with titles like, Eternal Moment. This is exactly what men should be doing at that age. This is the way to neutralize them. is fine. This is fine. This is how we got Savage Garden, you know? Yeah, okay, sure. Well, you know,

this might come as a bit of a shock, but David's music career hasn't exactly taken off. Instead, he's working as a massage therapist. Ephraim, on the other hand, has become a legend among their high school friends, the one-time fuck-up who's making mountains of money and actually achieving his dreams. When Ephraim moved back to Miami in 2003, he started his own company called AEY, named after the initials of Ephraim and his siblings. Since then, he's been winning larger and larger military supply contracts. He's even managed to recruit a wealthy Mormon gun manufacturer in Utah to finance some of his deals. And this connection eventually introduces him to a Swiss arms dealer who supplies the guns and ammunition needed to fulfill the contracts.

Meanwhile, Ephraim coordinates everything from Miami, acting, as a millionaire middleman. Of course, David doesn't know any of these details. All he knows is Ephraim is buzzing with excitement as he brags about a $15 million pentagon contract he just fulfilled, flipping old Russian rifles to help supply the Iraqi army. Then, Ephraim casually brings up what he clearly wanted to talk about all along. He's looking for a partner, someone hungry who wants to make money.

And he thinks David might be the right guy. In addition to David's day job as a masseuse, he's also been buying things like bedsheets off-sites like Alibaba and then reselling them to nursing homes at a markup. For Ephraim, this is proof that David can operate with an AE-wise business model. He'd be just as good reselling weapons instead of home goods. David is intrigued, but also skeptical.

So he asks Ephraim how much he's actually making. David is expecting him to say something. something like 100 grand. Instead, Ephraim says, $1.8 million. And that's that. David is sold. By the end of the year, he's working for Ephraim. His title is account executive, and he's working entirely on commission.

Ephraim explains a deal. He'll finance any contracts David wins, but David will only get paid on the deals he personally brings in. Ephraim has plenty of other deals on the side that David, David won't touch. David says that's fine. They shake on it and then get to work. Soon, they settle into a routine.

Every day, David shows up at Ephraim's one-bedroom apartment. They get high, and then they start brokering weapons deals from the living room. It is crazy how much of our lives hang in the balance with, like, morons at the dashboard. Yeah. Idiots. Evil morons on every level, basically. Yeah. Well, despite being a moron, Ephraim schools David in the world of U.S. defense contracting.

He introduces him to the FedBizOps website and explains his strategy. Find the small contracts that the big dogs don't bother with, then underbid everyone else. They'll source the weapons and ammo through Ephraim's overseas contacts, like the Swiss arms dealer he's already working with. At first, David struggles to win any contracts. bidding is part math puzzle, part poker game. He spends weeks agonizing over a bid for an $8 million state department SUV contract in Pakistan and loses. But eventually, he lands his first win.

A contract to supply 50,000 gallons of propane for an Air Force base in Wyoming. He nets $8,000 in profits. It's not life-changing money, but it's enough to make him believe he can actually do this. And he's going to need that confidence because soon, Ephraim is going to convince him that the two of them can compete with the biggest international arms dealers on the planet. It's now the end of July 2006, about seven months since Ephraim recruited David to AEY. Ephraim's in his kitchen, hunched over his beat-up laptop,

scouring the list of new contracts posted unfed biz ops. He takes a hit from his bong. then nearly chokes on the smoke as one listing catches his eye. It's massive, like nothing they've ever qualified before. The U.S. Army is looking for a supplier to provide 52 types of ammunition to Afghanistan, and they want to award the entire contract to one firm. On paper, AEY shouldn't stand a chance. Usually, the Army works with major players like General Dynamics,

multi-billion dollar publicly traded corporations, not some brand-new startup working out of their living room. The contract is around 25 times bigger than anything AEY has ever won. And yet, they have a license, so they're qualified to apply. So Ephraim calls David and tells him to come over stat. They've got a whale to catch. When David arrives, Ephraim tells him it's time to step up. He wants David to call every supply.

in Eastern Europe, anywhere that might have the stockpile they need. As an incentive, Ephraim offers David 25% of the profit on any new lead he finds. Once again, there's no written contract between the two. They just shake on it. The famously sturdy handshake agreement. Definitely what you want involved in your national security. God, yeah. Shaking on anything is the dumbest.

thing in the world. From the start, the contract is unusual. The U.S. wants this ammunition for Afghanistan because the war isn't going well. They need to resupply the Afghan National Army, but want to avoid going through Congress and triggering a PR nightmare. So instead, the Pentagon is outsourcing the job. The winning company will buy up old Eastern block weapons, the kind Afghan soldiers are already trained to use, from whoever has to be. some lying around. That's likely to include illegal arms dealers, gun runners, and warlords. In other words, whoever wins his contract will be laundering questionable weaponry for the U.S. government. Over the next few weeks, Ephraim lets David work at his place overnight to source quotes.

He listens as David shouts through bad phone connections, calling countries like Hungary, Bulgaria, Ukraine, any place that might have the stock they need. Meanwhile, Ephraim reaches out to one of his own contacts, a particularly shady character named Heinrich Tomei. Heinrich is in his late 30s, tall, polished, and blonde. He's Swiss and speaks flawless English with a slight accent. But though he looks like a movie star, he's actually a notorious arms broker.

Heinrich has connections across Eastern Europe and runs a web of shell. companies and offshore accounts to hide his deals. He's also on the State Department's watch list for illegally shipping weapons from Serbia to Iraq and has been flagged by Amnesty International for weapons trading in Zimbabwe despite sanctions, all of which means the Pentagon can't do business with him directly, but Ephraim can. At Ephraim's urging, Heinrich taps his Albanian contacts for even more ammo. Eventually, Ephraim and David estimate it will cost around 200,000.

$170 million to source everything they need. Now, they just have to decide how much to bid. But as the deadline approaches, Ephraim starts spiraling over the profit margin. Most big defense contractors land around 10%. Ephraim's typical margin is closer to nine on his winning bids. But this contract is so big, he wonders if he should go down to eight to make sure they win.

Every percentage point is worth millions. But if he gets too greedy, he could lose out on the contract altogether. He paces, smokes, curses, and second-guesses himself. Finally, at the last minute, he lands on 9% and writes down their final offer. $298 million. That would mean they'd personally make around $27 million. With 10 minutes to spare, he and David jump in his car and race to the post office to get the bid postmarked on time.

AEY is one of 10 companies in the running, and they've just unknowingly underbid everyone else by $50 million. I would assume that that would make their offer seem really, really attractive. Yes, but months go by without a word. Then one day, an email arrives from the military. AEY hasn't won the contract yet, but they've made the shortlist. Before moving forward, the Army needs to audit the company to make sure they can handle a deal of this size, which is a problem because they ask for all kinds of documentation that Ephraim and David don't necessarily have.

Ephraim's been bluffing his way through this industry since he was a teenager, but now he takes it to a whole new level. First, the military asks for proof that AEY has the capital to cover the contract. So, Ephraim sends over his own bank statement, which shows he has $5.4 million in his account. Then, he leans on one of AEY's investors, the Mormon gun manufacturer from Utah, who agrees to put up his properties as collateral and proof of further funds. No one seems to double check whether these properties super high appraisals are legit. Next, the military asks for evidence of past performance.

So Ephraim uses a license for a deal that he had started but failed to complete and makes it seem like it had gone through successfully. Then, the military asks to review their books. But the guys have never had a real accounting system, so Ephraim hires a forensic accountant to go through AEY's records and backdate everything to look legit. And finally, the military wants an on-site inspection, which is tricky because AEY is still operating,

out of Ephraim's living room. So Ephraim quickly rents in office, fills it with furniture, and hires a few middle-aged ladies off Craigslist to make it look like they have more employees. And somehow, it works. Ah, sure, yeah. Of course it does.

Nothing surprises me anymore with the story. No, anything can happen, and everything kind of does happen. And on January 26, 2007, Ephraim calls David and asks what he wants to. first. The good news or the bad news? David says, bad news. Effraim smirks through the phone, practically giddy as he says their first order is only $600,000 worth of grenades and ammo. But the good news is they got the contract. In total, it will be worth $300 million. The terms are

pretty simple. First, the ammo must be safe and serviceable. And second, because of an arms embargo, absolutely none of it can come directly or indirectly from a communist Chinese military company. A rule that I'm sure they're going to follow. Well, that night, David and Ephraim pot bottles of Chris Dahl at an upscale Italian restaurant passing a cocaine bullet under the table. Ephraim is euphoric, telling David how the two of them are going to take over the entire arms industry. But in the car afterward, as Ephraim lines up, Coke on the dashboard, his tone shifts.

He warns David not to make any mistakes with the grenades. If he fucks up, they'll lose the entire contract. David and Ephraim have just landed a deal with more money than either of them ever imagined. But winning the contract was the easy part. Now, they actually have to deliver the goods. If they pull it off, they'll be set for life. But if they mess this up,

There'll be enemies of the state. I'm Raza Jaffrey, and in the new season of The Spy Who, we tell the story of Dr. A.Q. Kahn, the spy who sold nuclear secrets to Iran. He was the scientist spy who stole nuclear technology from the Netherlands and used them to give Pakistan a bomb. But he didn't stop there. He became a black market atomic salesman, a fix-it man for rogue states seeking nuclear weapons.

including Iran, Libya, and North Korea. And that left the CIA and MI6 in a race against time to put him out of business. Before the world's most wayward regimes get hold of the world's most destructive weapons. Follow the Spy Who now, wherever you listen to podcasts. You can also listen to the full season of the Spy Who sold Nuclear Secrets to Iran. Early and at Free on Audible. I'm Leon Mayfok. best known as the host and co-creator of podcasts Slow Burn, Fiasco, and Think Twice, Michael Jackson.

I'm here to tell you about my show, Final Thoughts, Jerry Springer, whose name is synonymous with outrageous guests, taboo confessions, and vicious on-stage fights. But before the Jerry Springer show became a symbol of cultural decline, its namesake was a popular Midwestern politician and a serious-minded idealist with lofty ambitions. Through dozens of intimate and revealing interviews with those who knew Springer best, I examine Springer's lifelong struggle to reconcile his TV persona and his political dreams and aspirations. Named one of the best podcasts of the year by the New Yorker and Rolling Stone, final thoughts, Jerry Springer, is a story about choices, how we make them, how we justify them to ourselves,

and how we transcend them or don't. Listen wherever you get your podcasts. Or binge the whole series ad-free right now on Audible. Start your Audible subscription in the Audible app. A month later, in February 2007, David's on the phone with a potential source for grenades and ammo. He drops his voice an octave, slips in some military jargon, and says, AEY is, quote, part of the vital process of nation building in the central front of the war on terror. The men on the other end of the line seem to buy David's bravado,

which is good because Ephraim has David doing a ton of work. for the Afghan deal. That initial $600,000 order really did turn out to be the tip of the iceberg. Before they even finished that fulfillment, the Army dumped another $49 million in orders on AEY, including 100 million rounds of AK ammo. Ephraim's been traveling overseas looking for suppliers.

That means David's been on his own, responsible for sourcing the bulk of a quarter billion dollar contract from a one-bedroom apartment. He feels like he's finally making progress when Ephraim returns and makes a shocking announcement. He says that, actually, they're going to go through with Heinrich, their Swiss arms dealer. Apparently, it doesn't matter how much work David's done. Ephraim has his own plan as usual. David is not happy to hear this.

But Ephraim explains his logic. He says Heinrich has a source in Albania where the stockpiles are huge, the prices are unbeatable, and, crucially, they don't require much upfront cash. It's too good to pass up. Even David has to admit that. So they give Heinrich the Green Lane. He'll get the ammo from Albania's state-run exporter, then resell it to AEY. This allows Heinrich to get paid as a broker without working directly with the U.S. government.

And AEY and the Pentagon can avoid the moral headache of doing business with a corrupt country like Albania. And with this setup, AEY can make a way bigger margin than they expected. Instead of a 9% profit, they're now looking at something closer to 25%, roughly $85 million in profit. The promise of that money is intoxicating. It's enough to keep David from thinking too hard about Ephraim tanking his deals or the fact that Ephraim keeps convincing him to roll his earnings into future deals instead of actually paying him outright. Instead, David dreams about what he'll do with his $8 million cut,

like hiring top-tier session musicians and a producer to help him record the album he's been planning, which he decided to name Microcosm. When the album takes off, he'll be so rich and famous, he won't even need Ephraim or arms dealing anymore. I genuinely hope that's true. I hope that's where this story ends up. would be wonderful. Would it, though?

I mean, do you really want an arms dealer, pop star? We already have Tate McCray. Well, okay. There's only so much we can do. She's from Calgary. But, I mean, I want a former arms dealer who turned into a pop star because he realized he shouldn't do

that form of evil. Okay, okay. We can talk about this later. But David is so eager, he doesn't want to wait for his payout to start upgrading his life. So he dips into his savings. He buys a blue Audi A4, and he leaves his tiny apartment to move into a luxury condo at the Flamingo in South Beach.

Ephraim moves in two, and oh so coincidentally, their weed dealer also lives in the building. It's the perfect setup. The Flamingo quickly becomes their playground. Sun-drenched pool decks, topless sunbaters, constant music, an endless stream of parties. They brag about being international arms dealers to models and finance. pros who can't tell if they're kidding. When they're not partying, they're getting high at the gun range, firing Ephraim's personal collection of Uzi's and MP5s.

Ephraim also rents legit office space in Miami Beach. He decorates his office with a Lord of War movie poster. He also makes a few new hires, including a couple of more buddies from the synagogue. And then, all the fun gets a real buzzkill when Alex, one of the friends they hired, calls from Albania with bad news. He says the ammo they bought is all Chinese. Ephraim and David scrambled to come up with the solution until finally they give Alex's orders

to just repackage the goods and get rid of the Chinese markings. No one has to know. This is the moment from the very beginning of the show, Sachi. I didn't like these guys from the beginning, and this is an incredible turn in the story where more context only makes them worse. Yeah, once again, these are people with truly no redeemable qualities. But for a moment, David and Ephraim feel like they've reached the summit.

Money, guns, parties, power. They've beaten the system. At least that's what they think. But while they're partying in Miami, half a world away, their decision to repackage Chinese ammo is going to come back and bite them. At an Albanian coffee shop called Chocolate Cafe, cardboard manufacturer Costa Tribesca sits across from the U.S. Embassy's economic attache. At first, Costa was happy to take the AEY repackaging job.

But once he saw the Chinese markings, he started to suspect something shady was going on. So he arranged this meeting to make sure everything is on the up and up. Costa tells the attach what's going on. He expects shock or outrage. Instead, the American official waves it off. The embassy has been trying to find the funds to destroy Albania stockpile anyway. If AEY wants to ship the ammo to Afghanistan instead, great. That saves them the cost of demolishing it.

As far as the embassy's concerned, everything's fine. Costa is confused, and he isn't the only one. Military procurement laws are complex, and they often contradicts. dictate each other. In this case, the U.S. Embassy appears to be working off a clause that says if munitions sit in a new country for five years, that country is now considered their country of origin. So the old ammo sitting in Albanian warehouses is technically Albanian now, not Chinese. However, the Pentagon's regulations do not include that same clause. An AEY's contract falls under Pentagon rules. So the ammo, their

trying to sell is still technically banned. It's cool that ammo becomes naturalized citizens. Yeah, I didn't know that bombs had a easier chance at becoming a citizen than either of us. Yeah, basically. Okay, something else to think about at 4 in the morning when I can't sleep. Costa leaves a meeting feeling somewhat reassured, but not entirely convinced. Then his phone rings. It's Ephraim calling for Miami, and he wants a favor.

He asks Costa to use his government contracts to find out what Heinrich is paying the Albanians for ammo. Ephraim suspects Heinrich is ripping them off. Costa looks into it, and it turns out, Ephraim's right. Heinrich is charging AEY a little more than four cents per round. But he's only paying the Albanians two cents. He's doubling the price for simply being the middleman. Ephraim wants to cut him out of the deal entirely, so he asks Costa to arrange a meeting with the Albanian government.

And Costa agrees. Costa assumes the Albanians will jump at the chance to cut Heinrich out. And if they work directly with AEY, everyone will make more money, minus Heinrich, of course. But that's not what happens. Instead, the Albanians cut Costa out and the repackaging job is reassigned to the Prime Minister's son. It soon becomes clear that Heinrich hasn't

just been marking up the price, he's also been kicking money back to the Albanian government. They were never going to get rid of him. But Costa, he's collateral damage. So now, Costa's contract is canceled and he's left with a bunch of workers to pay, not to mention a warehouse full of custom cardboard boxes he can't use. He is furious. In June, he calls Ephraim and records a conversation just in case. He demands to be brought back into the deal. Ephraim offers downright insulting advice. Like, he suggests sending a woman to seduce the head of the export agency, or maybe trying a $20,000 bribe.

But ultimately, he admits he can't control the Albanians. That excuse isn't good enough for Costa. He demands Ephraim pay him at least $20,000 for the boxes he purchased. But Ephraim refuses. So Costa decides to make him pay another way. He calls up a reporter at the New York Times and tells him everything he knows. Costa has sent the old consequence machine into motion. But in the meantime, David and Ephraim don't need help getting themselves into more trouble.

By June 2007, David feels like things are back under control. The first shipments of ammo have been delivered to Kabul. And even though the ammo is arriving in repackaged boxes, every round still carries a Chinese factory stamp. But no one seems to care. Officially, the government has a ban on Chinese weapons, but in Afghanistan, they're so desperate for supplies that, as long as they can claim ignorance,

they'll accept whatever shows up. And so, the deliveries are approved, payments clear, and millions of Pentagon dollars are wired straight into AEY's accounts. Ephraim is flushed with cash. David should be too as soon as he gets his cut. David feels like they've accomplished what they set out to do, so he takes his foot off the gas. After months of sleepless nights and endless phone calls to Eastern Europe,

he starts coming into the office late and leaving early. Ephraim notices and the tension builds quickly. He accuses David of not pulling his weight and not helping with their other contracts. David pushes back. He works on commission, so why would he spend time on deals he won't get paid for? Ephraim tries to argue that if David really wants to succeed,

he'd want the company to succeed too. David isn't buying any of this, so Ephraim hits him with a gut punch. He wants to renegotiate their deal. Ephraim doesn't think David has earned the 25% they initially shook on. Instead, he's offering David a $100,000 salary, plus 1% of AEY. Here's David describing the moment

in an interview with the YouTube channel Soft White Underbelly. And I said to him, well, you know, I'm supposed to get 25% of the Afghan contract, and that's going to make us at least 90% of the money that this company's going to make

probably more for the next few years. So I think I'll stick with my 25% rather than your 1%. And he goes to me, he's like, how about zero? Take it or leave it. And I said, go fuck you. yourself and I walked out the door. I came this close to smashing him in the face.

As they show me doing the movie, it was very cathartic to watch that part. Well, well, well, a handshake contract falling apart? Who could have predicted this except every lawyer, all lawyers and me? All lawyers and all people who've ever done anything. Yeah, it's kind of your fault, dude. I'm sorry there was no justice in your arms dealing. Handshake contract. Oh, screwed over by the arms deal.

Damn. David is pissed, but because there's no contract in just a handshake, Ephraim controls the company, the accounts, and the cash. David threatens to go scorched earth. He warns Ephraim that if he screws him over, he'll go to the authorities. After all, David has plenty of evidence showing that the ammo moving through Kabul is Chinese. But the threat doesn't work, maybe because Ephraim knows that if David blows a whistle, he would be in trouble too.

Eventually, David hires a lawyer and they negotiate a settlement. But it's not what David hoped for. Without any sort of written contract, he doesn't have any leverage. He ends up accepting a nearly $300,000 settlement. Ephraim insists that the settlement be paid out over the next two years, so David won't just call the authorities after he gets paid. David tells himself that something is better than nothing, but he's bitter.

He quits AEY, then starts a rival firm called Dinacore Industries. David never planned to be a lifelong gunrunner, but now he's operating out of spite. Plus, whether he likes it or not, David is good at arms dealing, and he wants the money he feels he's owed before he walks. away for good. David and Ephraim both feel like they've gotten screwed over, but their personal feud is nothing compared to what's coming next, when the federal authorities come knocking.

It's early morning in August 2007 in Miami Beach. From the 29th floor balcony of the Flamingo, Ephraim leans on the railing, a cigarette burning between his fingers. Inside, just beyond the sliding glass door, his current girlfriend is asleep in his bed, still wearing last night's makeup. They stumbled home from a club only a few hours ago. Today is supposed to be a clean break. Later, he and David will sign their settlement papers and officially end their partnership.

Ephraim exhales, watching the smoke drift out over the water. Then his phone buzzes. It's his secretary. She tells him that two dozen federal agents are at AEY's offices with a search warrant. They just marched in, ordered everyone away from their computers, and now they're boxing everything up. Ephraim keeps his voice calm and asks to speak to the agent in charge. While he waits, he walks back inside, steps over a pile of dirty clothes, and pours himself a screwdriver.

Finally, Special Agent Michael Mantablus comes on. His tone is clipped and cold. He tells Ephraim, they're not leaving, and Ephraim needs to get to the office, Now. Then he hangs up. I feel like maybe this is the only person this guy's going to listen to. Yes, of course. I mean, Ephraim isn't big on following orders, but even he knows he has to play this carefully. So he gets into his car and he calls a law firm he's worked with before. The lawyer tells Ephraim he'll be right there and until then, not to say a word to anyone.

At the office, Ephraim reads over the search warrant and he all. almost laughs. The feds are investigating whether he lied on defense department contracts and whether he had proper licenses. Technicalities really and not the actual crime he committed, like, you know, repackaging Chinese ammunition. Ephraim is thrilled. The Chinese ammo doesn't seem to be on the agent's radar.

As long as it stays buried, he's convinced everything can be argued away. But unbeknownst to him, his ex-partner is about to make that nearly impossible. I'm Leon NaFock, best known as the host and co-creator of podcasts, Slow Burn, Fiasco, and Think Twice Michael Jackson. I'm here to tell you about my show, Final Thoughts, Jerry Springer, whose name is synonymous with outrageous guests,

taboo confessions, and vicious on-stage fights. But before the Jerry Springer show became a symbol of cultural decline, its namesake was a popular Midwestern politician and a serious-minded idealist with lofty ambitions. Through dozens of intimate and revealing interviews with those who knew Springer best, I examine Springer's lifelong struggle to reconcile his TV persona with his political dreams and aspirations.

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David gets a call from his former secretary who tells him what's happening. His first thought is that Ephraim got what's coming to him. His second is that they are both screwed and he needs a lawyer. And his third thought is that he needs to work. warn Alex, his friend who arranged the ammo repackaging who is still working for AEY. David calls Alex who's still in Albania. When Alex hears the news, he leaves Albania altogether and destroys his laptop. He's paranoid that Ephraim planted something on it to frame him.

Back in Miami, David is starting to think things through. He knows that if federal agents see their emails about the Chinese ammo, the jig is up. because obviously they weren't being secretive about it. It's all there in black and white. He figures his best option is to turn himself in and hope for mercy. So his lawyer sets up a meeting with Special Agent Metavelas, the man who led the raid on AEY's offices. David sits down and starts talking.

He walks investigators through everything, the bidding, the repackaging, the Chinese ammo they tried to hide, everything. When he brings up the Chinese. The agents just burst out laughing. Though they weren't aware of that debacle when they first rated AEY, they're aware of it now. They literally found a to-do list on Ephraim's desk that said, repackage Chinese ammo.

I know I say this a lot, but this is like that episode of The Simpsons with the monorail where they find Lyle Landley's plans and it's just a drawing of him running away with a bag of money. Yes, exactly. It's a bit of arrogance mixed with stupidity, I guess. Yeah. Over the next few months, David meets with investigators again and again about 30 times in total.

He walks them through AEY's books, the shell companies, and the entire Albanian supply chain. He also convinces Alex to cooperate. After getting over his initial panic, Alex returns to Miami, quits AEY, hires a lawyer, and confesses everything he knows to federal agents too. Officer Mantavlis tells David and Alex their cooperation is appreciated because Ephraim is his real target. I don't imagine he's going to have a hard time morally rolling over for his friend. I really don't think so,

because David is just hoping he could go back to being a massage therapist chasing his pop star dreams and never touch a gun again. Unfortunately for David and Alex, they're not the only ones talking. Remember Costa, the Albanian cardboard dealer? He's been talking to a New York Times reporter the entire time. And when that story breaks in March 2008, the U.S. authorities want to see heads roll. A few months later, David, Ephraim, and Alex are indicted on 71 counts of fraud. They all plead guilty, but remained free while waiting sentence.

Unfortunately for one of them, this freedom will only make things worse. It's July 2010, two years since the AEY crew was indicted. Most of them have laid low while awaiting sentencing, except for one. Right now, inside the Orlando office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, senior special agent Kevin McCann is listening in on a call between Ephraim and another arms dealer. This arms dealer just happens to be an ATF source. Allegedly, just a few days earlier, Ephraim called up the source and tried to sell him a pallet of ammunition. When the source declined, Ephraim suggested something bigger, partnering up to buy and sell machine guns for profit.

Remember, this source is in cahoots with the feds, and Ephraim is still awaiting sentencing for the Chinese ammo case. One of the conditions of his bail is that he cannot buy, sell, or own weapons of any kind. On the call, Ephraim explains that he can't work with the government anymore, so he's operating in the commercial market instead. He says he still owns several companies selling U.S. and imported ammunition. And if the source wants to partner with him, Ephraim can supply the ammo while the source supplies the machine guns.

Technically, Ephraim thinks this gets around. his bail restrictions because ammunition is considered an accessory, not a weapon. Oh, wow, that is real distinction without a difference. Yeah, I mean, it's already such a weird industry anyway. I'm sure that it is a legitimate loophole? Mm-hmm. Well, ATF, Special Agent McCann and his partner know they've got Ephraim on the ropes. He is legally allowed to sell ammo, but that's it.

If he's also selling weapons, then he's in deep trouble. So they conduct a sting operation to catch him in the act. An undercover ATF agent poses as a potential partner. On recorded calls, Ephraim brags about hunting alligators with a 50-caliber rifle. The agent invites Ephraim to meet up and go shooting. He tells Ephraim to bring a gun. Ephraim shows up, but without a weapon. He's not that stupid.

But the ATF agent brings a gun of his own, and offers it up to Ephraim to try. And Ephraim can't help himself. He takes the gun, inspects the weapon, and in a moment of pure ego, tells the agent that he'll never leave the arms business. In fact, he says, quote, once a gun runner, always a gun runner.

And with that, the ATF agent arrests him. That's a pretty good line. It is. It's like, damn, time to go back to the old me. The real me, yeah. This incident really doesn't help Ephraim when his sentencing date finally arrives. He's already pled guilty for AEY's illegal doings, so he's hoping for a reduced sentence. But prosecutors argue that Ephraim doesn't understand the seriousness of his crimes and doesn't feel remorse.

The judge seems to agree. Ephraim is sentenced to four years in federal prison. This is not a lot of time, Sarah. I mean, again, we always talk about this that we like don't believe in prison, but four years for illegal arms dealings feels small? It's basically nothing. And meanwhile, David, thanks to his cooperation, gets seven months' house arrest. Alex receives just two months probation.

And Heinrich, the international broker, vanishes. The last rumors place him somewhere in Bosnia. After that, nothing. In 2016, Warner Brothers releases the film War Dogs starring Jonah Hill as Ephraim and Miles Teller as David. The movie throws their story into the spotlight, which David is thrilled about. But Ephraim, not so much. He ends up suing Warner's and the filmmakers, claiming that he's been planning on making a movie based on his memoir.

His main complaint is about how he's portrayed, and that the film is marketed as a true story and not based on a true story. He hopes to win millions from the lawsuit. In the end, Warner Brothers settles with him in a confidential agreement. Today, Ephraim runs his own investment firm, DeVaroli Investment. And in 2022, the U.S. military ended his 15-year contracting ban early, meaning he's free to work with the government again. Of course, yeah.

Good. That makes me feel good. Yeah, you know, it all works out in the end. For some people, yes. Meanwhile, David has become an entrepreneur and self-described inventor. While under house arrest, he developed a new type of drumming pedal called The Beat Buddy. And in 2024, he leaned into the War Dogs name recognition and launched War Dogs Academy, an online course where he teaches others how to bid and win on government contracts like he and Ephraim once did.

Here he is talking about his next act on soft white underbelly. I'm not going to say that I'm justified in everything I did. We definitely weren't honest. I mean, we were convicted of fraud. So for me to help other people to do it the right way, it feels kind of like a redemption arc that I am now part of helping other people create a life for themselves and a career for themselves in a way that's productive and helpful to say.

society. Sachi, before we really dig into the story, do you remember the other episode that was inspired by these two wannabe warlords? No, I was going to ask. What was it? The episode was about Natalie Cochran, who watched the movie War Dogs with her husband, said, we can do that. Ended up scamming and then killing her husband. Yeah, I don't know how she extrapolated in that way. But this is a really frustrating story about bad people doing bad things and mostly getting away with it. Basically totally getting away with it, which is why someone like Natalie could be inspired. Like, the biggest consequence faced is four years in prison. Big whoop.

People go to prison for longer for far, far less, as we know. Yeah. I guess you and I think about how evil the world is quite a lot. Was there anything in this story? that was kind of surprising to you or change your worldview at all and made it worse. Did this story change my worldview? No, this story has only affirmed my worldview that this is all like bullshit. The idea that just a couple of teenagers are like,

we would like to sell things that murder people, I'm still struggling with that. I can't even get beyond the legitimate portion of this to deal with the scam part of it. Yeah, exactly. These people were doing some of the most evil. acts imaginable, which is promoting war and selling weapons that kill innocent people, and that wasn't even the issue with their scam. It wasn't that they were doing this, is that they made some mistakes while doing it. Not to sound crazy, but there are no real barriers between who are considered allies and enemies as long as it's kind of benefiting whatever narrative at the end.

Like, there are no rules, basically. And it's like one of these stories that kind of, of if you think too hard about it, it does break you a little bit. Yeah, I guess what I learned is that we are just too close to the machinations of war. That's not a fun one, is it? It's that we're too close. It's too legal. What is legal? Who decides?

What is anything? It's a good reminder that we make everything up. It's all fake and we have invented it. And these are bullshit rules that we've put in place to protect only a few people. And it seems the people we have protected are gun runners. I guarantee the average person has more rules in their mind for how the world works than how many rules are actually are. Yes. And that is all to say the lesson here for me was that everyone can be evil.

Even teenage stoners. I actually am upset about how this story is making teenage stoners sound. Because you know what? We didn't do this stuff. This is not what we were up to. we were looking at weird posters and watching YouTube videos of music videos we liked and walking in the woods and eating snacks. And I just think that the stoners in the world need a little better PR than this.

Yeah, there needs to be more gatekeeping there for who gets to represent stoners and who doesn't. I did not watch the movie War Dogs, but I remember it being promoted as some kind of like vehicle for Jonah Hill and Miles. Teller to bro out. I saw this movie on a plane at some point, and it wasn't this horrifying. A lot more hijinks than this story is suggesting, I'll say that. Let me guess so it's more about how it affected them in their friendship. It was probably framed like they were doing bling ring style stuff. Honestly, it just was like two guys in sunglasses.

I don't remember more than that. Follow Scamplencers on the Audible app or wherever you get your podcasts. You can listen to all episodes of Scamflincers ad free by joining Audible. From Audible Originals, this is Ephraim Diveroli and David Packhouse, a farewell to arms for scam influencers. I'm Sarah Hagey. And I'm Sachi Cole. If you have a tip for us on a story that you think we should cover,

please email us at scamfluencers at audible.com. We use many sources in our research. A few that were particularly helpful were Rolling Stones, the stoner arms dealers, how two American kids became big-time weapons traders by Guy Lawson. The New York Times is Supplier Under Scrutiny on Arms for Afghans by C.J. Chivers Once a gunrunner, the Ephraim DiVroly memoir by Ephraim DiVroly with Matthew B. Cox and War Dogs,

the true story of how three stoners from Miami Beach became the most unlikely gunrunners in history by Guy Lawson. Alex Burns wrote this episode, Additional writing by us, Satchie Cole, and Sarah Hagee. Zan Romanov is our story editor. Our senior producers are Sarah Eni and Ginny Bloom. Our associate producer is Charlotte Miller. Our managing producer is Desi Blaylock. Fact-checking by Kalina Newman. Sound design by James Morgan.

Additional audio assistance provided by Augustine Lim. Our music supervisor is Scott Velasquez for Frieson Sink. The executive producer for Audible is Jenny Lauer Beckman. The head of creative development at Audible is Kate Naven. The head of Audible Originals, North America, is Marshall Louis. The chief content officer is Rachel Giazza, copyright 2026 by Audible Originals, LLC. Sound recording, Copyright, 2026. by Audible Originals, LLC.