$300M Arms Dealer Exposes INSANE Government Corruption, Boeing Secrets, and National Coverups

the federal government's budget is 6.7 trillion they're buying everything under the sun bullets and tanks and nuclear bombs and fighter jets and they're buying literally everything and I'm like we won the contract he's like yeah mother efim was just being efim all that mattered was the bottom line didn't matter who got in the way who he trampled over who got screwed I realized that I might be facing a lifetime in prison I seriously thought about killing him David pack house thank you so much for coming on the iced coffee hour I am obsessed with your story I've seen the movie like several times I abolutely it we're so honored to have you here well thank you I'm honored to be here so you're an international arms dealer or you were an international arms dealer son was was and uh I saw on another podcast someone called you a warlord yeah arms dealers get a bad rap because they sometimes Supply Warlords I never did that I supplied the US government so anything that that was done with the arms that I supplied you could blame the US government for that well the Stone mag called you a merchant of death right uh I mean we were supplying weapons and ammunition to the federal government who was supplying it to the afghanis and the Iraqis and uh you know it's military hardware it's intended for one thing so what type of kid grows up to be an international arms dealer well it was never my intention growing up to be an international arms dealer that was not uh what I got into it wasn't something I intended to do I just kind of fell into it because a friend of mine EFM deoli uh famously got into it and um kind of took me along to the ride yeah what were a few of your first jobs were you always interested in like business or making money my first job I guess you could say I had when I was six years old um my dad I was living in Israel at the time and uh uh we lived in this uh apartment building uh that didn't have an elevator it didn't have a uh didn't have a garbage shoot and so my mom was asking me and my older sister to take out the trash and we had said like take it down the stairs and take it to the dumpster on the corner and uh we were complaining we didn't want to take out the trash and my dad comes and he's like you know why are you guys complaining and we're like we don't want to take out the trash it's too much work and he says well you know you guys are looking at all this all wrong you know you're thinking that this is a big like hassle but really it's a big opportunity and we're like what are you talking about he says well think about it all the neighbors they don't want to take their trash out too so you can go to all the neighbors and offer a service you'll take take out their trash you don't have to do it every day cuz you don't have a full trash bag every day take it out every other day and you could charge I don't know maybe a shekele a week that comes out to about a quarter a week and so we thought wow that's a great idea so we went to all the neighbors and we offered our service and we signed up about eight neighbors and after the first week we told our dad you know this is way too much work because we had we were like little so we we had our mother's a cart and that was on Wheels and we'd fill it up with trash bag and go kachunk kachunk kachunk down the stairs and then take it to the to the uh dumpster on the corner and then we have to heave it up over into the dumpster and uh we told our dad this is way too much work and he said well would it you know we said we didn't want to do it anymore and he said well would you want to do it if uh if you're getting paid twice as much money and uh we said well twice as much money maybe that's worth it okay twice as much money we do it he said well then just tell the neighbors that you raise the price and you know now it's two shekel a week and we said but we can't do that we just told him a week ago that it's one shekele and he said well if you don't raise the price you're going to quit anyway right so at least give them the chance to pay what you need to do the service and so we went to all the neighbors and we told them and almost all of them were like yeah no problem two shekel is it's like 50 cents a week and and um uh one neighbor quit and from then on we saw their daughter take out the trash who was she was around our age we' never seen their daughter take out the trash before but I guess they figured you know they got used to that luxury yeah you ever wish you did three shekles you know going back in time you always wish that you charge more right because you don't know how high you could have gone before you start losing the customers right but uh I'm sure we probably could have even done four yeah and then you could always work down yeah that's true know give one person deal that's true especially if it's a new service that no one's done before uh they don't know what a normal PR prices right so it's pretty much you're setting the expectation so you always want to set it high and then if people if you don't get the customers that you want then you could go down and see if it's a pricing how did your dad come up with this idea was he just like a business guy at heart he was a rabbi so it wasn't like he was a a business guy like looking for every opportunity I think he was just trying to uh uh Inspire us to stop complaining and do the chores that our mother was asking no at that age though what importance did you have with religion was was your father very that you follow the same path that he did yeah well my dad was a Orthodox Rabbi so for people who don't know that's a very intense form of the Jewish religion um and so yeah I mean I grew up like that I went to an all boy school didn't talk to a girl who wasn't related to me until I was 17 it was a huge culture you didn't talk until you were 17 what about like out in public like the grocery store it's very the Orthodox commity is very insular so you don't really associate with people who are not Orthodox Jews you know how was that then talking to your first girlette 17 because I can imagine that's got to be like the mostri Earth shattering thing like it really was it what was the circumstance for you talking to I'll tell you um I'll remember it forever uh so I was sent to so when I at the end of at the end of 10th grade I was asked politely by the uh head of the school the private Jewish Orthodox school that I was was going to to not come back next year and the reason was that they didn't feel like I wanted to be there I didn't want to be religious and they were right I didn't want to be there um I would fall asleep during prayers you know I didn't take my uh Bible studies seriously so they were like this guy doesn't want to be here and and they were totally right yeah so my parents sent me to the next best option which was a school called Hebrew Academy in Miami Beach and it's also an orthodox school but it's a modern Orthodox school which is a there's different sects there's the ultra Orthodox which are the ones with the long curls theim and uh then there's the modern Orthodox my parents were in the middle so I went to an alloy school we didn't have a TV at home uh of course we kept all the Commandments the Sabbath and everything but the modern Orthodox they send their kids to they have co-ed school so it's still private they still Study Bible but it's a much shorter school day and they're girls in the class right so my parents sent me to that school I remember my first day in class uh I was sitting in class and this really cute blonde girl was in front of me she was facing forward and she like turns around she's like oh you're David the rabbi son right and like I tried to say something but like my voice caught in my throat and then like my face like turned white and then she like like looked at me and she like kind of like turned around started like whispering to her friends and then my face turned red it was the most embarrassing thing ever it was really um was that was that scene as a positive to be like oh yeah it's the rabbi son like it's almost like a status thing big deal status thing yeah yeah it was my dad was a pretty well-known Rabbi in the community so yeah he but then how did you then like like throughout the rest of your life did you notice that you like kind of suffered in that aspect of your life because you never really got acclimated to that years for years so it took like years to finally make up it took years yeah like I probably didn't get comfortable talking to girls probably until like my early to mid 20s I've said this time and time again the less money your business spends the more money you get to keep but with high expenses on everything like materials employees distribution and borrowing everything costs more so to help reduce costs and expenses smart businesses are graduating to our sponsor netsuite by Oracle netsuite is the number one Cloud Financial system bringing accounting 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so when you wake up in the morning before you open your eyes you're supposed to think thank you God for waking me up right and then you go to the bathroom and uh once you you after you use the bathroom you're supposed to wash your hands but you can't just wash it normally right you have to fill up this like big cup this like Mug kind of thing and you have to do one two one two one two like that then you after you leave the bathroom you have to say a prayer to God thanking him for letting you go to the bathroom and then before you eat anything you have to say a prayer before you eat it and depending on what you're eating it's a different prayer it's a specific prayer it's not like you know with Christianity you close your eyes and just speak to God or whatever no it's a specific prayer that you have to say in a specific way and and so and then you have to go to synagogue three times a day and read that specific like you stand up for this part you sit down for that part you say you know the leader of the prayer says this you say that it's very ritualized right it's kind of like it felt to me like you were a bit of an automaton right and uh and there's people who find spirituality in it and I'm not saying that you can't but I didn't right to me it was just everything was wrote it was very um I felt very robotic and very constricted and when was the moment that you decided that religion was not for you uh so I realized after taking a general a general anthropology course that either all of science is wrong right and I'm not just talking about just one branch of science I'm not talking about just like chemistry or archaeology or linguist I'm saying like genetics like everything has to be wrong or the Bible has some things in it that are not correct do you feel like religion is better or worse for society overall that's a great question uh very hard to know overall right um because there's definitely a positive things that religion brings it teaches people empathy take care of each other but then again it's got a lot of downsides too because often times the that Golden Rule tends to be applied only to your in group and screw the other people you know there a bunch of Heretics burn them right um so it is my belief as a humanist that we can do all the things that religion tells us to do without needing an invisible man in the sky to tell us to do it right I don't need you know Sky Daddy to tell me that killing and raping and torturing people is wrong I just know that and what were the biggest difference living in Israel versus the United States Israel is a much more traditional um culture so I think all traditional cultures have a more bigger emphasis on family I mean modern American society is kind of like uh fraying in that sense there's a lot you know relationships tend to be a lot shorter here and uh and I mean Israel has a huge segment of modern non-religious people and it's the same thing as over there as in any Western Country um but there's a huge segment of of religious people there too and they subscribe more to the traditional um lifestyle and that tends to have stronger family units and stronger relationships that tend to last uh longer not necessarily happily but they but there's a lot of social pressure to to maintain that yeah I I would say that Israelis are notorious for being very aggressive uh in business yeah I I say that I I spent almost a decade working in Beverly Hills real estate and there were a lot of Israelis that were buying Beverly Hills real estate and you knew immediately that they were going to negotiate the contracts harder and better than anyone else and they almost always got their way because they were so Savvy in terms of throwing out deals and pitching something and and they got the lowest prices on homes they're very good at that so there's a very big haggle culture in Israel in the Middle East in general it's not just Israel but yeah it's um it's like they expect you to haggle and it's just part like Americans like think that haggling is kind of distasteful over there it's considered like a like an arc yeah but I see I really I was attracted to that because I found it so invigorating that everything is negotiable mhm what whatever they see fixed and I I almost learn from this like what whatever you see you can negotiate it yeah and they would come in and that you know the home inspector and say Hey you know I don't like the price on this but I'll pay it but you throw in this too yeah and they'll get their way or they walk in and say you know okay well if I pay this price how about you include that commissions were a big one oh maybe not that right we'll pay this one and like every little detail was negotiable and you know as a kid I'm seeing this like oh my gosh like everything is negotiable if you ask it yeah that's true um it's interesting different cultures have different uh um uh philosophies and negotiations and different strategies as well I read a book a while back and I forgot the name of it but they went through like different culture uh negotiating strategies like certain cultures I think like the the Chinese uh they try to just wear you down uh by just like asking for the same thing over and over and over until you give up you know so that's like a strategy you know some people you know uh the Israelis will try to get you know like okay I'll give you this but give me that you know so it's like that's a big one yeah there's there's different different cultures have different techniques and uh I think I think understanding those you know who you're talking to is a huge leg up in negotiation what do you think the American culture is when it comes to that is it just simply don't ask and complain about it behind people's backs it seems like that's the cult here is like I'm grudgingly doing this but I'm going to talk crap to everybody else about how much I dislike this yeah I think that American culture is more like like you could negotiate but pretend like you're not negotiating right you know like it's it's it's a it's considered slightly distasteful to negotiate here so when you do negotiate you're you're trying to like doing it in like as nice of a way as possible or or thinking of a of you know of reasons why like makes sense and and it's like oh we're all just like you know coming to it's like less of a it's like less confrontational yeah they try to keep it the confrontation down to a minimum that's that's American culture yeah that's so interesting what other businesses did you do before eventually going into defense after I came back from uh from Israel and started college I realized I needed to make money and uh so I bought a um at the time uh digital cameras were getting really big right this is a little while back what year was this this is like 20 2002 2002 yeah I think that's when I got my first digital camera that was big deal yeah yeah they were huge deal they were all the rage back then there were no smartphones so that was like the first time you move Beyond film yeah I realized it's one thing to buy a digital camera but you also need to buy the SD card and because they came with like these tiny little SD c i SD cards that had very low capacity and so I was I went online to try to find like a high-capacity SD card and they were like ridiculously expensive and so I kept on searching for a better deal and then I found people who were doing h wholesaling of SD cards but I had to buy a 100 and I realized that the price difference was big enough I could sell the rest of the SD cards on eBay so I bought 100 and I sold and I sold them out like that because I had a pretty good price and then I bought a th000 and I started selling them you know pretty doing pretty well SD cards were great business because they're take up almost no room very easy to ship uh nowadays it's all flooded with like counterfeit stuff so it's it's uh how do you find a wholesaler though alibaba.com is a great way to find manufacturers that's how you did it yes well actually back then it was made in china.com I don't think Alibaba like existed I don't think it was existed then yeah I think it was made in china.com how do you find made in china. like I just Googled it you just Googled buy bulk yeah I just buy like a Buy SD card cheap you know oh and that just came it after like a few pages of so you had to do you had to put in the leg work exactly yeah I went a few pages deep yeah it wasn't just the top click right yeah I mean everyone would find that so what were the margins like on that they were pretty good they were pretty good I I think I was doing like back and this is back then I'm sure it doesn't apply nowadays but I think I was making something like between 30 and 40% margins wow yeah and how did you get the money for that first order before we go into that as you're probably aware we are nerds when it comes to the YouTube algorithm like we'll spend years analyzing everything that we do on 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like a issue in my neck I'd been in a car crash and I had realized that I needed to learn how to fix myself and that massage therapists make like $75 an hour and all my friends were working minimum wage job and I didn't want to do that so I realized I could do one massage and make more money in in an hour than my friends were making the entire day flipping burgers so I was doing that part-time I was in college studying chemistry and uh and that's when I bumped into efim diveroli who uh got me into the whole arms thing so a couple things I'm curious on the SD cards because that's like basically you're the OG drop shipper yeah say wholesaling that's like actually Drop Shipping essentially I mean I would actually purchase them and in possession of them okay so you would actually take them you'd have to ship them out I would have to ship them out so you sent out how many was it a thousand yeah yeah manually yeah I hired my younger brother to do the shipping oh what you pay him I think like five bucks an hour five bucks an hour it's not too bad okay right eventually I cut him in on the business and then he did decently why don't you just keep doing that that sounds like that was the most profitable thing you were doing it's very passive as well eventually I got a shipment of bad SD cards that were that claimed to be a certain member M capacity and they really weren't and then I got stuck with it and the manufacturer was like too bad I'm not giving you your money back and I'm like well I'm never buying from you again and you know and that kind of like destroyed the business why you buy it on an AMX I know yeah well they don't take that what did you end wire them the money what did you end up doing with the memory cards um I I think we just tossed them out eventually oh that hurts yeah cuz they were like defective so you go you said back to college and that's where you met at from uh so no so I was in college at the time um I was doing massage on the SD cars just to support myself uh while I was in college and um I met up from it was uh at a mutual friend's house we were both smoking weed and uh he he came over I was smoking weed with my friends and he came over to hang out with them and um and then you know I hadn't seen him in like a few years because he had been shipped off when he was 16 to uh his uncle's um place he actually his uncle lives in LA and owned a big pawn shop so I'll give you a little bit backstory about Ephraim uh he he got caught so he also went to a Orthodox school we met when we were in uh I think I was I'm actually four years older than and um so I was 16 he was 12 when we met we met in synagogue neither of us liked to pray so we'd sneak outside during prayers to like hang out on the basketball court um I had friends who were were like two years younger than me who found him entertaining so that's kind of how he joined our friend group he liked to play pranks and stuff like that like he some of the pranks uh so Orthodox Jews have the men they have to wear a kipa right which is like the little hat you know the little cap on top and officially you're not allowed to like walk more than four steps without it on so he would love to sneak uh behind like like older guys and like steal it from them and like run off and they would cover their heads and run after him and then beat him up and take it back and then they would walk away and then he'd steal it again how was that nen is like highly disrespectful it was seen as highly disrespectful which is why he got beaten up but he was completely Fearless so he would what were parents you would think that the parents at that point would step in and say efam you cannot do that his parents were busy praying in the synagogue like he was supposed to be so but how do they not see his disobedient child that's also not subscribing to the same religion oh they they had issues with him disciplinary yeah they had issues with him and they were not his his mother tend to blame all his friends for his you know she thought hang theong crowd that's exactly it and I think his mother must have blamed me for his weed smoking or something at some point because yeah I heard some things but it doesn't matter um yeah so anyway so he he went to a Orthodox Jewish school as well and uh but not mine it was a different one in in Miami the one other one in Miami and um when he was 16 he got caught smoking weed and they kicked him out of school for that and his parents said oh well you know if you're not going to take the rules seriously the rules of school seriously we're going to you know show you what real life is all about we're going to send you off to your uncle to work right you're going to join the workforce and so they sent him off to La his uncle owned a big um uh pawn shop and uh one of the things this the pawn shop sold was guns and he got obsessed with guns he was just like super into it he you know loved shooting guns he loved reading about them he loved learning he knew everything about every gun and uh started selling the guns in the store then he started selling the guns on the gun boards which is like uh like forums uh online and uh everything pwn pwn store inventory he was selling on the gun forums yeah the pwn stores inv the pwn store's inventory and then he once he got a real bit of knowledge of the industry he started finding good deals to buy guns and so he would he would see he'd realize oh this particular gun is being sold under market so he'd buy it and then he'd sell it to he was 16 how could he do that at 16 he couldn't he was doing it all under his uncle's name and his uncle was in full support of it yeah his uncle I made a deal with him that he would get a cut and uh so if his parents knew about this they think that their entire plan their scheme of like sending them there is just like maybe I mean yeah I'm sure they wouldn't uh support him doing anything illegal but I don't think they knew that it what he was doing was illegal I think they figured I'm not even completely sure about what the legality of that is everything's under his uncle's name and he's just Manning the phones and stuff you know his uncle signing all the paperwork and everything so it might have even been legal as far as I know I honestly don't know um but so he worked for his uncle for about two years and during this process uh during this time he uh his uncle started bidding on State local and State Police contracts so when the government when the police force wants to buy something they put out a request for bid and uh then whoever wants to supply them with Whatever item submits their best offer to them and then they pick you know who's the combination of lowest price and lowest uh and most reliable supplier and all that and so he learned the Government Contracting system uh from his uncle by doing this uh worked for his uncle for about two years until he was about 18 and then he claims his uncle screwed him out of like 70 grand I guess the cut that he was supposed to get his uncle didn't want to give it to him his uncle claims that he screwed him out of 70 grand you know so I believe in both you know his uncle has a terrible reputation in the industry as well for screwing people over so um you know I don't know who screwed who it doesn't really matter but um he came back efim came back to Miami when he was 18 and uh took over one of his dad's company's aey Inc uh his dad had uh Incorporated this company um uh I think to use as a printing uh label a label printing business and but it had been dormant for a few years he hadn't used it for anything so he took over the company uh you know the company structure and uh registered it with the federal government under his dad's name because he was um I think he was actually still under 18 when he first came back to Miami so he was like 17 about to turn 18 so everything was under his dad's name he registered it with the federal government started bidding on federal contracts this was in 2004 so right after the invasion of Iraq and uh the Bush Administration was privatizing everything and so there was a huge amount of money going to um uh to support the war in Iraq in general but a lar a large amount of it was going to small business set asdes so Bush um the Bush Administration got in a bunch of scandals because his vice President Dick Cheney was the former CEO of halberton which is a huge defense contractor halberton got several multi-billion dollar contracts on a no bid basis like a soul Source award meaning that they didn't compete for it it just was given to them a few billion dollars and that created obviously a bit of a scandal and so they increased the amount of money to try to counteract that they increased the amount of money that was set aside for small businesses to say hey look we're not just giving the big boys all the money we're giving all the small guys a piece of the pie too and uh so that there was a huge amount of money that was for small business set aside so which he obviously qualified because he was a oneman shop and so he started winning he bit it very aggressively and he was very knowledgeable and particularly with guns and ammo and so he started winning these contracts and started making a decent amount of money uh worked on his own for about a year and that's when we bumped into each other and he asked me you know while we were at our mutual friends house he was like hey you know what you doing these days and I told him about the SD cards I told him about you know um I was also actually selling u a bed sheets and towels at the time and so I told him about that about the bed sheet business about the SD card business and he said well you know a lot of the stuff that you're doing is very similar to what I'm doing finding suppliers negotiating prices arranging Logistics getting import licenses all that stuff um but I bet I'm making way more money than you so uh maybe you should come work with me you know I could use a partner and you know you're a smart guy I trust you we grew up together I really could use a partner and I said well uh you know how much money you made right and he's like I'm G to tell you but uh only to inspire you I'm not bragging all right and he opens up his laptop and he logs into his Bank of America checking account and he shows me he has $1.8 million in cash just sitting in his bank and uh I was blown he was 18 years old and uh I was like holy crap this guy knows how to make money he knows this business really well he's making a lot more money than me that's for sure so I said well you know that's super impressive I'm in let's let's do this and uh that's how I got into um into um doing the Government Contracting so that $1.8 million he made that in one year yeah and was that profit or was that still that that was profit wow yeah that was his money in his first year of doing this in his first year of doing business yeah yeah that's insane yeah no it was incredible uh yeah cuz he got a he got someone he got an investor to fund his contracts so he was able to just keep the profit without having to roll his so how does that business work could you walk us through how he is able to make $1.8 million in a year doing this right like so the way the government works right is um whenever they want to buy something they post on the government website these days it's a Sam .ov sam.gov like Uncle Sam and it's supposed to be a competitive system so that the government gets the best possible price right uh so let's say they want to buy you know uh 500 M16s uh they say we want to buy 500 M16s it needs to be delivered to this place at this time uh they needs to be brand new production or they'll have different requirements depending on the contract or this they'll say you know it could be uh used but only but it has to be you know this level of quality or whatever right and uh and then whoever wants to bid on the contract submits their uh their best offer and you have to follow a whole bunch of procedures and requirements and uh different contracts have different requirements depending what it is like for example um if it's like under 100 Grand then usually you don't need something what they call past performance which is proof that you've done this business before but if it's more than 100 Grand usually they'll require pass performance meaning you have to prove that you've done this business so when you're brand new you have to bid on these smaller contracts and build up a reputation and then you could build up a bit on the larger contracts so uh if you win the contract meaning that they they have different criteria that they that they judge what's the best value to the government right it's not just the price sometimes it's just the price on particularly on the smaller contracts they just care about the price but sometimes it's the quality of the stuff you're offering it's the delivery time it's how much past performance you have how comfortable they are with you as a entity that that you're reliable to deliver what you say you're going to deliver and then they score you depending on all their different criteria and they pick the best total value to the government and once you are awarded the the contract then you have to deliver right and you have to deliver within the time frame that they tell you and once you deliver you get paid usually about 30 days later they usually have Net 30 Terms different government agencies have different uh sometimes have different terms but by and large it's net 30 what's the profit margin on like a $100,000 order so like usually 10% 20% so it varies wildly um they keep all the bids a secret so you don't know who you're competing against right but you will see uh but they do publish the winning bid right so you can look and see what has this item sold to the government in the past and then you can you can kind of get a ball park right now depending on what you're bidding if it's very competitive then you'll probably want to put a very small profit margin on it in order to increase your chances of winning right but if you know the market really well and you know that there you don't really have any competitors then you could put on a huge profit margin and if you win you get that right because the government only whoever submits a bid right that's their options right you have to submit the bid and you have to be licensed you have to go through all their Hoops that you need to do in order to qualify to submit these bids so there's uh there's actually a many companies if not most companies don't bother to deal with the government because it's just such a hassle to have to jump through all these hoops you have to get all these registrations these licenses follow all their rules you know read their like 40 Page Long uh solicitation documents and understand what they're saying and and uh you know do all that stuff so a lot of companies don't even want to deal with the government because it's just such a hassle it's not like in the private sector give me a uh you know a purchase order I give you an invoice you pay me that's it right it's it's much more complicated now is corruption the only reason they go and do these bids because it seems easier from the government's perspective just to have a few main suppliers negotiate a price form that they know in advance and just work with them then you kind of know what you're getting right so the idea here well first of all the federal government's budget is 6.7 trillion right biggest single customer in the world the defense budget is 800 billion which is larger than most Count's entire budgets probably the next five combined or something uh but uh the so so they're buying everything under the sun I mean they are buying everything from socks to boots to food to laundry services I mean like and bullets and tanks and nuclear bombs and fighter jets and they're buying literally everything right so now something like a nuclear bomb or a fighter jet they usually do what they call a soul Source contract you know if they want to buy an F35 only locked Martin makes F35 so they buy it directly from locked Martin they negotiate a price usually it's a Cost Plus contract meaning that that the government will pay locked Martin what it costs them to build it plus like two or 3% profit margin that's usually how they do it of course that gives blocky Martin an incentive to increase the cost of their uh of their product because the higher the cost the more that margin is worth yeah I'm curious why they would do Cost Plus profit because the cost is arbitrary and could be anything like you tell me hey gram make me this your Cost Plus that I could just be like all right well I'm going wild on this who's and who's to say that they don't cut deals with other people and say hey charge me this and give me half back and then my cost just went up by double but I'm getting Kickbacks on that so Kickbacks are very very illegal right if you get caught you'll go to prison okay um however uh cost overruns are not illegal right if they can give a good legitimate reason of why it cost them right so much money to do something then that's reasonable and so their incentive in a Cost Plus contract is to increase the cost of the contract as much as possible because they're agreed upon set percentage of profit the dollar value will increase with that cost for every $100 it cost more you will make2 to3 more exactly exactly now the reason the government has done this and the reason they have these Cost Plus contracts at all is because they usually do it for things that have um a a unknown R&D budget right so for example when they're developing the F-35 fighter jet right they want they have all these requirements it's got to have thrust vector control and really Advanced anti- radar you know paint coding and really Advanced avionics and and all these things that that have not been developed yet they need new technologies to go into this thing and when you're developing a new technology you have no idea how long it's going to take to develop or what the cost is going to be so if the Air Force says we want a plane with these characteristics uh locked Martin will say okay you know we can build that and we think it's going to cost this and this is how we think we're going to do it but because there's so much uncertainty um they do the Cost Plus because then they can run into a situation where locked Martin runs out of money and then their their fighter jet is gone um is not going to happen now that's not to say it's impossible to do a fixed price contract which is the opposite of the cost plus uh SpaceX famously um delivered the astronauts to the space station and cargo deliveries to the space station on a fixed price contract which previously had was all Cost Plus Boeing Starliner is they're doing another fixed price but they're charging twice as much as SpaceX so they are now on a fixed price contract but that's a new thing okay that was like the first time they'd ever done that NASA pushed for that to happen because their programs were so Infamous for ballooning out of control um but yeah I mean that's why I think the Cost Plus contract originated in World War II when they you know were trying to turn the entire industrial base of the country on a war footing and you know they wanted to get like Ford and all the indust Ral powerhouses to start making uh military hardware and they're like just do it we'll pay your costs we'll give you an extra percentage of profit and that's how it you know because they can't they don't know how much it's going to cost them when they're doing these things and how does efim teach you how to make money doing this so he taught me about how to read the solicitations what all the terms meant uh he knew a lot of a lot of um kind of the tricks of the trade so to speak because he'd been doing it for so intensely uh for the past year uh well three years if you count the time he spent his un with his uncle and uh and I just dove into it um at first I was working uh he was doing all arms he was doing all weapons and ammo and stuff because that was a specialty and the idea was that I would try to expand the business by doing other things so I focused on fuel at first and my first contract that I won with the federal government actually was a contract for 50,000 gallons of propane uh delivered to an Air Force Base in Wyoming so how did that exact contract come about you see it on this website yeah and you think to yourself okay this is something I think that I could find a supplier of what made that deal stand out as opposed to other deals or do you just put offers on every single deal and that was just the one that struck the reason I picked that deal because it was under $100,000 so we didn't need past performance so I knew we could qualify to bid on it it was also propane which is a very um fungible good right it's a g you know propane is the same no matter where you buy it so it wasn't something um that that was hard to find and um and it was just something that I thought that I could probably uh I could probably do because it was simple so what was the total cost of that I don't remember the Topline cost I just remember it was under 100,000 and that uh I made 8,000 in profit from you made 8,000 and he made money he made also 8,000 we SPL a 50/50 yeah so was that your agreement in the beginning everything was to be split 50/50 yeah that was the agreement was that I would do all the work and he would provide the financing as well as the expertise and uh in the final negotiations and how many hours went into that one contract that one actually was a relatively easy contract um if I had to guess it was probably about like maybe 20 30 hours of like research and negotiations and cuz it wasn't just I also had to find the delivery company the logistics company that transports propane and uh you know move it from point A to point B and all that and have to negotiate 20 to 30 hours for $16,000 in profit yeah about say yeah it wasn't bad what was the next deal after that or what was what the the next few deals generally look like right so I worked on a whole bunch of deals that I didn't win um I worked on deals uh I got real close to winning I worked on a pretty big deal for SUVs to the the state department in Pakistan uh that was like a multi-million dollar deal that we got to like the final stages so for a big deal usually what happens is they'll like when you're in the final running they'll like Whittle it down to like just a few potential suppliers and then they'll do what they call an audit right where they uh they look at your um like your financial capability your um your organizational capabilities uh your past performance they look into it more deeply and when they do that audit you know you're in the final running right there's you're only competing as maybe like two three other companies potentially when depend if it's a big deal usually there's like 30 40 companies bidding on it depending on the product sometimes there's no companies and you're the only one bidding and and if you know that then you could really make some crazy margins but um but that's why they don't tell you right the sometimes they let it slip it's uh if you talk up the Contracting officer uh the right way sometimes they give you information they shouldn't um but um uh so I was really close to winning that deal but it fell through uh worked on like some food deals for like meals ready to eat MREs they call it which is like pretty pre prepackaged uh food for the military that fell through uh the next deal I worked on was uh for a rare gun parts contract and this was actually a contract that epim had won but he didn't want to actually work on delivering because it was for a bunch of spare parts for rare weapon systems uh to go to the Special Forces to train them because the Special Forces they operate all over the world and they sometimes uh they they train them to use the resources available in the environment they're in and sometimes that means learning to use old weapons right and so they need to train them on these old Weapons Systems and uh so efim had bid on this contract and he bid really big margins on it because he knew he knew the industry and he knew that this was going to be a huge pain in the butt to deliver because it was like 150 different items and like really rare hard to find stuff so he bit a really high margin and uh then he won it and he didn't want to do all the work to to deliver on it so he gave it to me to work and so I spent like a good like month and a half working to track down all the suppliers of these like World War II era like German pistol and Soviet era stuff and and what was the profit on that I think we were on some part it varied a lot because we'd negotiate in different parts some some parts we were making like five times uh the the cost so yeah so like if we were buying it for one we'd sell it for five how do you find these suppliers are you just going on Google typing like rare gun parts and just like finding somebody I would say it's uh tenaciously searching on Google it's not just a a casual search right so you need to go as many pages deep into the search results as until it stops being relevant right because you're competing against people who are doing the same thing and really whoever Works harder is going to win right so you can find that one supplier who's going to win you that contract and they may be buried five pages six pages deep in Google search results and if you go that far back you're going to win and your competitors are going to lose but that's just one way so another way is to get references so when you're you know when you call up somebody and you ask them for a quote and they say oh I can't Supply this you ask well do you know anyone who can supply it and sometimes not always sometimes they'll be like you know actually for this thing I think this guy call that guy up and sometimes you get really good sources like that that are not in the Google search results uh another way is to go to trade shows like we did with Euros sator in Paris and you actually meet people in person who are in the industry and um a lot of times those people don't show up in Google search results either so you can get some real competitive Advantage by making these connections I saw there was a lot of posts so we went on before you got here on the whole fed Business website and I just typed in for fun ammunition yes and there were 25 results that were posted in the last 48 hours for ammunition yeah how many do you think are posted every minute it seems like probably every minute there's like a few postings for something that the government is looking for as I said $6.7 trillion dollar I mean they are the single biggest customer by far in the world many times over and they're buying everything so it's as unlimited as it gets what's the weirdest thing you've seen a post for although really quick before we go into that if you run a solo small business like we do you understand all the headaches that come along with running your own company plus I'm also sure that with tax season coming up you probably have a lot on your plate but with our sponsor Collective they allow you to focus on your business and doing things that really matter while their tax experts focus on bookkeeping and accounting Collective is the all-in-one Financial solution for self-employed entrepreneurs that lets you focus on your passion by handling all of the back office work you dread like accounting bookeeping payroll and taxes they even specialize in setting up es corpse which is a tax election that saves its members an average of $10,000 per year if you're a business of one making at least $60,000 in profit annually you could be missing out on thousands of dollars a year in tax savings but you also got to make sure not to wait to elect because the deadline to backdate your ESC Corp to January 1st is coming up on March 31st and for a limited time Collective is waving the onboarding fee when you go to collective.com and tell them I sent you that's a $199 value for free when you go to collective.com and tell them I sent you once again that's collective.com let them know we sent you thank you so much Collective for sponsoring this episode and back to the podcast what's the weirdest thing you've seen a post for I have seen a um post for agricultural products including manure things like that I would say that's so unusual uh I would say not weird but interesting um I've seen uh posts that um that kind of like hint at what's going on behind the scenes that you only that only make it into the media months later like for example I once saw a request for um for security services for uh army base in Chad right which is this country in Africa and uh and I never seen Chad in the news like I don't know why they were asking for I didn't even know we had a base there and then like three months later it came out in the news that there's this whole like anti-terror operation there and so you kind of get a hint of like the things that the government is doing um that don't make it into the media by what they're looking to buy and where they where they want it to be delivered be a smart place for journalists to look I would definitely recommend that journalists look there yeah so where were you at in your life when all of this was going on you were in were you in school still were you doing this full-time were you still doing the massage therapy right so while I was working with him I was still doing my side businesses um because I wasn't 100% sure if it was for me or if I could hack it or if you know I was going to succeed in this uh it's when we won the big contract that's when I quit everything the Afghan yeah the Afghan contract that's that's when I quit everything because it was a a $300 million contract and I figured this is going to make me millions of dollars and so concentrate on this and what was the relationship that you had with Ephraim looking like at that time were you guys cuz you were business partners I'm sure he set very high expectations out of you did that ever cause conflict in the relationship did you guys feel like actual friends or was it strictly like you know business partners uh it was both um it he was a very demanding person right he was a complete and utter workaholic but I mean like hardcore so uh when we first started working together I mean I realized his work schedule was like 18 hours a day you know he would wake up in the morning he'd while he's taking a [ __ ] he's you know looking at contracts or making phone calls or sending emails and he literally did nothing except for work um and he expected the same of me and so I I realized well hey you know this is what he did to be successful I guess that's what I need to do to be successful too and I'd never worked harder in my life than I did while working with efim uh and there was a reason he was so successful it's a huge part of it is the harder you work the more the luckier you get right that's that's the the famous phrase uh but it definitely put a strain on our relationship because he um like my personality is not that I'm like 100% obsessed with money all the time I have other aspects of my life I'm a musician I like to hang out with my friends I like to you know relax occasionally right and I like to read books you know like all these things I have other interests and he didn't have any other interests so uh he would always be yelling at me like why are you wasting your time doing that you should be in the office you know you know like like he'd call me at like 3: in the morning and I'd be like dude why are you waking me up he like oh we got to do this right now get to the office right now I'm like it's [ __ ] 3: in the morning man you know and he's like I don't give a [ __ ] if it's 3 in the morning you got to work right now so you know you want to make [ __ ] money you know he was like that kind of guy and so it was very intense very very very stressful um it he was he was a very Charming guy you know very funny and so he uh he can make a joke and get on your good side and and be very charming and and uh personable but then when like but then the next second he'll be like yelling at you to do this that or the other so it was kind of like a Jael and hide situation and when we did like go out and you know like on the town which was very rarely we didn't really like party that much to be hon but um occasionally we'd go out to South Beach and he'd get plastered I mean he like he did everything to the extreme so like he worked to the extreme he drank to the extreme he was doing coke all day I mean it was like he did a lot and uh and he was completely fearless and kind of a total [ __ ] really um he would go he would get wasted and like go up to like a like a couple in a in a bar right like that we were at and he'd go up to the girl and he'd be like like hey baby why are you with this loser you should hang out with me and he like take her hand and try to like lead her away and like like and he'd get into fights and I'd have to like pull him out of these fights yeah and it would happen all the [ __ ] time did that ever work did he do that like they never left their of course not they never why did he keep doing it if it never worked I think it entertained him I think he enjoyed it yeah would you ever talk to him like dude why tell me like the psychology about what's going on actually deep down that causes you to take such such action you know like he never got that deep right I would always tell i' be like dude I'm so sick of getting pulling you out of fights can't we just like go out and just hang out and be normal one day and be like yeah yeah yeah next time don't worry I got you bro you know I won't do that next time I promise I promise and then of course you do the same thing you know uh the one time I saw it work actually I mean not the exact same thing but um we were once in a club and he sees this girl sitting by herself and he sits down next to her and he goes to her he's like hey uh you do Coke and she goes well not not in a long time and he's like you want to do some coke and she's like okay and they go off to the bathroom and he dated that girl for 2 years are you serious and it was the most dysfunctional horrible relationship I'd ever seen in my life I mean they were like always yelling at each other screaming at each other and like you she would break out crying in front of like everyone you like at restaurants in public I mean it was really really terrible yeah and like she would break into tears and run to the bathroom and yell at run after baby baby baby I'm so sorry I I swear I didn't mean it you know I love you I'm going to buy you a diamond we're going to go on a cruise you know just like BL BL it sounds like Florida yeah yeah that does sound like Florida sound like Miami where was the benefit or the value in that relationship I'm so curious because he seems like such a hard person to deal with how was he in a relationship and how could he maintain a relationship for two years it always blew my mind that she stayed with him honestly did she feed on that do you think cuz some people they like the toxicity of relation because it's what they maybe grew up with so it's comfor to them I mean she stayed with him I don't know exactly her thoughts of why she stayed with him uh I got to be pretty friendly with her she was actually a really sweet girl and uh I don't think she'd ever been in a Rel that type of relationship before and I hope she hasn't been since um I'm not going to mention her name because she's like she she wants this to be well behind her um but uh yeah I mean I don't I honestly don't know why he why she stayed with him where did efon learn this behavior from was it his uncle was it his parents like I feel like he's maybe modeling off of what he was around yeah I I don't I mean I couldn't speak to his parents relationship his parents did get divorced I you know I wouldn't never presume to know why they got divorced his dad was actually a super sweet guy uh very very mild mannered his mother was a bit more feisty um the one that blamed me for all his problems you so um but uh yeah I don't know how he like where he got his relationship modeling maybe it came from his parents but I I don't know that and his grandpa was a billionaire right yeah so his grandfather was um I guess you could say a bit of a toxic person his grandfather was a real estate billionaire he owned a huge amount of like the the slums in South Central LA he was like a slum Lord and um his grandfather uh got famous because it it's um after about like 40 years of marriage I think his grandfather had like eight kids with his grandmother and after 40 years of marriage they got divorced and um it turned out that they had never been legally married like they just got religiously married and so there was no legal documents about their marriage and so she asked for alimony and he said I'll give you zero like after he was a billionaire yeah he was a billionaire and didn't want to give her a penny and so she sued him for I think $700 million and it was the largest alimony suit in history how much did she win I honestly don't know how it ended yeah yeah I don't know if she won anything did he find like a young wife after that do you think or I don't think I mean he was pretty old when they got divorced I I don't know I don't know honestly I just heard this in passing like I never really put the details right you wouldn't want to talk to e about it I never talked to him about it actually that's I feel that's a hard thing to not discuss it's like you know your grandpa's a billionaire there are not many billionaires out there that's a pretty true remarkable thing yeah he did the only thing he mentioned about his grandfather was that he claims efim claims that his grandfather propped up his uncle's business that his uncle he Ephraim always talk [ __ ] about his uncle the one who taught him the uh the Government Contracting trade and um he always said that his uncle was terrible in business and was losing money every year and was constantly having to get bailed out by his grandfather so that's like pretty much the extent of the what he discussed about that so his grandfather was kind to his nephew just no to his son it was his son but just just to his son and not to his grandchildren did epim ever see a penny from never a penny no no his grandfather never gave him any so it appears as though there's this like gene or something that was in his family then and it kind of like skipped a couple of Beats and then just hit efim with like Max velocity where he just had this very aggressive netia like negotiating person for sure for sure from what not I've never met his grandfather um but um from what I've heard that he takes that his personality is very similar to his grandfather's yeah do you think epim was happy happiness is a funny thing right um I think that he was constantly under stress and I think he had moments of Victory where he would win but like it wouldn't last because he'd always have something else to uh to go after so yeah I wouldn't uh I wouldn't want to be him I I'll say that what was his day-to-day schedule like was it truly seven days a week 18 hours a day doing nothing but work when I worked with him yes that's what that's what it was later on in life I heard he um after we had already separated he got a lot more into like partying and having a good time and that's he gained a lot of weight and you know but uh I think he was like the few years before he went to prison he was I guess living it up yeah got it and what was your schedule like at the time yeah at the time I had the same schedule as him and it was very very draining and what would happen if you didn't stick to his schedule if you wanted to take a day off he would call me constantly and harass me really yeah he'd be like get back to the office we got to do this that and the other and you know you gotta [ __ ] sit on your ass you think you're just gonna make money sitting on your ass just constantly yelling on at me on the phone yeah and the operating agreement that you guys had was the deals that you worked on you got 50% of them so yeah that was the original agreement we had was that I would get 50% of the deals that we worked on uh when it came to the Afghan contract uh we made a different agreement because it was uh as he said it was his bread and butter it was the uh the this industry that he was very familiar with uh but he needed a lot of help to win this contract so so for that we agreed on 25% yeah now I'm curious were there any initial red flags when it came to efim that maybe gave you some hesitation about working with him huge amount of red flags and what were those uh so the first red flag that I that I remember thinking um you know that this guy is not like a normal guy uh was we were we were driving back from a gun show in Orlando and coming back to Miami and we were driving on this on the highway at night it was Pitch Black and there were no Street uh lights and uh it was like one of those highways that's super straight and it's just like one lane going in each Direction and uh he had his brights on and there were cars coming in the other direction I told him hey e you know when a car comes close you have to turn your brights down so you don't blind the other driver and he's like well I mean but I need to see the road and I'm like well I mean if you blind the other driver they can crash and he's like well I mean who gives it [ __ ] like I need to see the road and I'm like yeah idiot but they can crash into us and he's like oh yeah yeah good point and then he turns his yeah and I was like oh my God this guy like speak his language he's like physically incapable of about caring about other people and I was like this guy's really like a sociopath it sounds like a narcissist or sociopath it sounds like there's something in his brain though that's wired different cuz that's not like normal behavior that there's something about him that's like yeah it's just complete lack of empathy is really what it was and uh is it seems like like a lot of CEOs have like score high levels of psychopathy and it seems like there's a lot of similarities between that and like serial killers who can't understand another person's perspective or how they feel and it either goes in the path of crime or like really good at like business right seems like for him it kind of went to business right and it blurred into crime as well yeah did you ever see expressions of empathy from him would you ever see him do like nice things like treat an animal well or let's say like if he goes out to dinner and maybe he like really bonds with the server like riding them a big old tip or something like that never seen him write a big old tip ever was he very skimpy with his tips extremely skimpy with everything everything so one one time early on when I first started working with him uh I saw him get on the phone with AT&T and he spent like 45 minutes like insisting on speaking to the manager and going up the chain of command and because he felt like he was overcharged like five bucks on his bill and I told him like dude why are you like spending so much time on this five just let it go you know you have you're going to make more money spending your time doing something else and he's like it's the principal of the matter nobody [ __ ] me it was like it like bothered him on a personal level that you know but um so yeah I mean he was super super cheap with everything uh what about going out to drink and party and stuff like that so he would do that uh in the beginning he was really really cheap with that so I think it was when he started dating the girl uh then he started getting used to going to nicer restaurants because you know she kind of didn't like it when he'd take her to cheap ass restaurants um so he started getting a taste for higher-end restaurants but uh but yeah but I mean he was like very very cheap like compared to how much money he had he lived very very frugally he didn't want to like we didn't get an office until we won the $300 million contract until then we were working out of his uh out of his apartment and we had already won like I think maybe like $30 millionar worth of contracts at that point so it wasn't like he was already making millions of dollars but he just didn't want to spend like a few thousand a month on an office and it was only after we won a $300 million contract he's like okay we can spend a few thousand what was he spending his money on yeah nothing I mean he wasn't was he investing it he was he was using it to roll into certain so certain contracts he would fund himself because he had had the money and he didn't want to give his investor a cut so he would use it just to roll into that did he expect you to roll your money into the deals too yes so and that's kind of how I got screwed over uh so when I first started winning contracts he'd be like okay great you know we're working on this uh on this other contract we're going to need financing on it so I'll just roll your winnings into into financing this it's only fair I'm using my money to finance the contract so you should use your money to finance the contracts too and eventually he decided he didn't want to pay me and then there went all the money that I had won for all did you ever tell him that you want to take distributions from that and not roll the money into the next deal he convinced me he convinced me that fair was fair and that he was financing it so I should Finance it too so would he take distributions I mean he paid he he did he was using money right so but like his his um his finances uh I should say his accounting was non-existent like he didn't really uh do any sort of formal account until we were forced into it by the by the government after we won the $300 million contract then they wanted to see a whole accounting system and proof that we had an accounting system and so he created that from scratch if you were to ask him why he was working so hard and why he wanted to make so much money and basically sacrifice all other things that life can provide right what do you think his the answer to that would be uh I think that he most of all just wanted to win that was like his driving Force he wanted to win and for him the money was like proof that he was winning and he was beating everyone else and to him life was a zero sum game there's no like win-win situation there's like if there's a winner there's a loser and I saw him like do some shady stuff where he screwed over someone out of like all the guys like money and like pretty much destroyed this guy's business so he could increase his profit margin by 3% it was how did that happen um I don't know the details of it I just remember him like talking on the phone and the guy crying oh you serious cuz he would love to take phone calls on on speakers I'd like hear the conversation I wasn't like I wasn't involved in that deal and so I didn't really know the details but the guy was like but you said that blah blah blah and like he's like well the situation has changed and now we have to do it this way he's like but you're going to ruin me I'm going to go bankrupt he's like well you know this is business this is not something that I I'm so sorry but this is you know I can't do it this the only way we can do this deal is this way and the guys but I'm going to be real and and he's and then like he gets off the phone he's like well you know I got my profit margin's up 3% so that's worth it no way just like that so it seems as though he really changes his attitude and his personality to fit the person who he's talking to when did you first notice that well I mean he's very as I said he was very very personable right so very very friendly he's funny he's actually very funny he's a funny guy um uh I could I would see him like you know get in get on people like good side and then uh you know like U um like a meet like some new business partner get on their good side become real you know buddy buddy with them and then like a month or two later just screw them over and like throw them under the bus so it was like I realized that it was like an act that he was just doing he was just saying what people wanted to hear what would benefit him the most and outright lies too yeah I mean he would but he would do it he was very smart I mean he is is very smart um he do it in a way also very stupid but you know he's kind of an idiot savant in a way but um he would do things in a way that uh that would give him kind of like a like an out like you would say um yeah we're going to do it on this deal but uh uh you know uh this this I'm going to pay this uh minus the cost of shipping right and then like he'll find some way to you know balloon the cost of shipping to you know to like shift the money into his camp and of course he wouldn't pay that cost of shipping behind the scenes he was doing something else but he would tell the guy that you know you know the shipping cost is this and sometimes he would actually create fake documents to prove his point um so like when he would negotiate with someone he'd be like oh well you better give me a better price because your competitor just gave me this price and look I've got their quote right here and of course it's a fake document so he would use that as a negotiating tactic so it was reported by Rolling Stone mag that quote unquote when he was trying to get deal he was totally convincing but if he was about to lose a deal his voice would start shaking he would say that he was running a very small business even though he had millions in the bank he would say that if the deal fell through he was going to be ruined he was going to lose his house his wife and kids were going to go hungry he would literally cry he would I didn't know if that was psychosis or acting but he absolutely believed what he was saying yeah no he it was incredible I I saw that uh that uh incident it was uh with a uh with a Contracting officer and he was like he's like sir I'm going to be ruin my my son's in the hospital the medical bills are ruining us and we're barely scraping by and he would like his voice would shake and he would like I'd see him cry like the guy didn't see him but like like you could hear it in the voice like I could see him actual cry like you'd have tears on his face as if it was real and the second he hung up the phone boom he was a different person just like that now I'm thinking when he said he ruined the other guy's life over the 3% could it be that the other guy was faking it on the phone as well it could be but I I knew who that guy was and he was like this really conservative Korean guy and uh like I done like deals with him and he seemed like a real straight shooter so I I doubt it but then you lose him as a resource yeah so which is why he's an idiot savant yes so so okay so I there's um there's a guy named Matt Cox right who was ephraim's cellmate or or one of his fellow inmates while he was in prison he wrote ephraim's Memoir um and uh Matt told me that while he was uh writing ephraim's Memoir that Ephraim was telling him all the stories about how he screwed over this guy and that guy and you know just told him the whole thing and Matt told Ephraim he's like he's like Ephraim you know you can't just keep on burning all your Bridges and Matt told me that Ephraim told him he's like Matt there's a lot of bridges out there that was that was his response yeah yeah a lot of bridges out there he just didn't care it was it was not everything was transactional there was nothing built for the future that's just how he ran and he said that while he was in federal prison while he was in federal that doesn't really that I feel like that in and of itself would counteract his claim but there are plenty of bridges uh it was also yeah the irony is palpable well he one Bridge got caught up with him right you know but he's he's still Burning Bridges he's still getting into lawsuits so there's people suing him to this day yeah it was also quoted uh Ephraim was a republican because they started more Wars when the United States invaded Iraq he was thrilled he said to me do I think George Bush did the right thing for the country by evading Iraq no but am I happy about it ABS [ __ ] lutely yeah he hoped we would invade more countries because it was good for business all that mattered was the bottom line really it didn't matter who got in the way who he trampled over who got screwed who you know it it really didn't matter it's interesting to me that as I found out personally there doesn't appear to be depth to the equations because like everything that I do I'm always asking myself why am I doing this why okay I find myself chasing money I look at the past three months of my life oh this has been continually a very important thing for me is increasing my income it's like well okay why do I want to increase my income how is it actually changing my life but it seems like he never asked himself why it was just like I just have to win which is interesting because a lot of the times people that are just so focused on winning sacrificing every other part of their life usually they have like some sort of inferiority complex they need to prove themselves to somebody or something right it could that could be the case um I think he did feel that he needed to prove uh you know because his his uncle was like when he left he's like you'll never amount to anything you're nothing without me and he's like oh [ __ ] you I'll show you you know so I think that had a had a bit to do with it and his parents also um were uh obviously on his case as a as a teenager growing up um oh if you're going to continue down this path of smoking weed and you know you're going to be a bum on the street cuz to in that Community I mean it's different now because there's U I think more education but especially back then they didn't see a difference between like weed and heroin it was the same thing to them if you're smoking weed you're like a junkie on the street and like about to join a gang that's how they saw it so yeah yeah did most of your deals go smoothly that you were doing on this Government website most of them did go smoothly we we I mean there were a few deals that um he would try to pull things where to increase profit margins like um a big thing he loved to do was um uh was to uh uh do a a or equal substitution right so they have the government will sometimes allow you to not deliver the thing that you contracted for if you give them a good reason why it's not available or you can't do it and they'll allow you to do a substitution right so his like Playbook would be like he would underbid a um a an item and knowing that there's like a like a less expensive version of that item and then he would make up a whole story to the government about why that particular is not his fault that it's not available and that he you know but that he can give them even a small discount if they would accept this other item and once in a while they would actually agree to that because his story was so good and uh then his margins would be enormous because that item is like half the price and it's going from like a 2% margin he's going to like a 50% margin so when he would do that often times the Government Contracting officers would push back and say no you can't do that and then he'd have to scramble and and have to like find the item that he underbid at a lower price than was available in the market and occasionally we lost some contracts due to that I think there's either five or seven contracts got canceled because of that you know what's interesting is it sounds like he liked screwing over other people more than he liked benefiting from something like he would go to such far lengths to make sure the other person just gets a little bit worse of a deal rather than just okay let's seal it up let's get this done I can focus my efforts here and let's say we make more profit on a month-to-month basis yeah that's exactly and I think the the phone call with AT&T is a great example of that I mean it was just it was more of an ego thing than an actual money thing I mean it makes sense yeah and where he screwed over the the Korean guy I mean to get an extra 3% I realized at the time like this is going to make zero difference to him right like his bank account is the percentage difference is going to be very very small it's not going to change his lifestyle in any way it's not going to really make any difference to his life it's going to make a big difference to the guy screwing over right so I think he was more it was as I said it was about winning it wasn't about really the money in the bank cuz he barely spent the money at the time anyway he barely spent the money so it was really just a like a game of winning let's talk about the Afghan deal this is the $300 million deal that you guys got with the US government to supply it was mostly Munitions right so it was like it was Rockets as well as uh AK-47 ammo yeah and stuff like that how did that come to be at the time this is in 2006 uh George Bush was super unpopular and uh it was that towards the end of his second term and the the Bush Administration figured that uh the next president was probably going to be a Democrat and which they were right Obama was elected in '08 but they also thought that the Democrats would pull out of Afghanistan immediately which they were wrong about took until 2020 right and uh so they planned to arm the Afghans for like the next 30 years because after we invaded Afghanistan and bombed the Taliban and took over uh uh we tried to build up a democratically functional government uh Hamed Karai was the president and uh part of the things that a any functional government needs they need an army and they need a police and the the Army and the police need weapons and ammunition and so uh the federal government wanted to make sure that the Afghans wouldn't run out of ammo once we pulled out and so they figured they're going to supply them with a massive amount of ammo like good for the next 30 Years so they put out this uh solicitation and they tried to buy it all from the Russians and they were planning on buying it all from the Russians but then the Russians supplied Iran with uh nuclear technology and got put on the band list so they got put on The Black List and it became illegal for uh for the US government to buy from the Russians so because of that they realized that the only way they're going to get this is from like a million different suppliers all over Eastern Europe because the Afghans they use um they're used to warsof p uh weapons right so there's two main different types of weapons in the world there's war wars upack which is former Soviet Union and there's NATO standard which is the West the West uses M16s the Soviet Union used U AK-47 and the Afghans from the80s uh they're used to using AK-47s you also need a lot less training to use in AK-47 it takes a lot less um you need to do a lot less maintenance on it it's a much more robust gun it's not as functional as not as uh accurate as an M16 it's kind of like the difference between a Toyota Corolla and a Ferrari right the Ferrari will drive faster but it's a lot more finicky a lot more you need a lot more maintenance so they needed to Supply Warsaw packed Munitions to the Afghans but there's no one in the west that manufactures this stuff at least not at scale so they knew that they would have to get it from former Soviet countries and because the Russians were out they realized there that there's no single supplier that could Supply everything so they didn't want to deal with like a million suppliers so they put it out for bid they're saying you know all the middlemen of the world right uh give us your best combined bid for all these items and we bid on it because it was a lot of stuff that we' already been supplying to Iraq in much much smaller scale so we had a lot of past performance on it we had proof that we' done this business with these items before so we knew we technically qualified we didn't actually expect to win because it was just so massive um uh we bid it in in the SU summer of 2006 and uh we were eventually awarded it in uh in early 2007 and how do you bid on a contract like how much work goes in on the back end to determine how much you're going to price everything out with right so it was a lot of work so the way we the way we structured the deal with uh with between us because he had like five main suppliers that he was already used to doing business with for these types of things and um and he told me you know for us to win this contract we can't just use my normal suppliers we really have to pretty much get a a quote from everybody on the planet who's has any Supply so you leave these Five Guys to me and then you go out there and get all the rest of them so I spent like a good like about two months of 18-hour days you know just Google searching making lists spreadsheets um a lot of the suppliers were Eastern European they didn't have email addresses you have to call them up and then they don't speak English and you have to get a fax number and then it they only did things by fax and often times the fax number was down it was busy and it wouldn't go through and so there was a lot of like a lot of grind to get uh to get all those uh quotes but after about two months of really hard grind we had like a really good um we thought we got like a price from pretty much everyone and their mother um and we thought we were pretty competitive and now you have an option of like how much to bid it right and so at the time uh of course everim always did everything at the last second so uh so we had a deadline this particular contract we needed to submit in paper form like most of the contracts you just submit online like with an email but they maybe because of the size of the contract they wanted this particular contract to be in paper form so uh we had to print it all out it was like 50 pages we had to print out and mail it and uh and we were at the day of the deadline where we had to to mail it and he just couldn't decide what percentage to put on it so he at first he was like we're going to put 9% profit margin on it because probably everyone's bidding 10 right and he's like but what if someone else is thinking that everyone's bidding 10 so they're going to put nine so maybe I should put eight but are are people really doing that if I put eight you know 1% of this contract that's $30 million so that's a huge amount of of money um and that's 10 % that's three $3 million um 1% and uh uh you know that's like millions of dollars every percentage so he was like going back and forth back and forth and I'm like Ephraim if we don't bid on this soon we're going to get zero so just make a decision eventually at the last second of course he decides on 9% we print out everything like the printer jammed we have to like quickly change the cartridge and we're like you know Sweating Bullets we're like and then he's like going like 60 70 miles an hour down like uh uh residential roads to get it to get to the uh to get to the uh post office and we like run up to the post office and they were about to lock the door and he's like no and they open they're like fine fine we'll let you in and he managed to get it in time uh and then we didn't hear anything from them for like a few months and we're like okay we probably lost that they probably just aren't contacting us because you know they they went with someone else and then we got a a message that they wanted to do an audit and we're like oh my God they're actually considering us for this and it was like a a few different audits it was like Financial Logistics um Supply and uh like past performance and they wanted to have a huge amount of documents and it took us like a good like month and a half they even sent uh they even sent like a team of government um officials to our office to like inspect our operation wow and we were super nervous because it was just like you know we didn't expect anyone to actually visit us and so that was when uh he hired a forensic accountant to go and create the financial records going back to the beginning of the business which he didn't have and so he had to like make it look like we had done all these Financial recordkeeping in the past and and it was just like a huge operation for us to make it look like we were legitimate and but the um it was like I think three like uh three older ladies who came by they were ended up super sweet very very nice and they all they gave us glowing remarks glowing glowing marks Did he charm them I'd imagine they came of course he yeah he was he was so good at it he would be like he's like wow he would like meet them he's like oh wow over the phone I couldn't tell you were so beautiful he's like he's like you know if it wasn't completely illegal I'd be buying you diamonds right now yeah he would say oh my gosh he was funny he was really funny it was very Charming yeah yeah which is why he you know I think was a big element of his success yeah he was very good at it okay and so they loved him you know they loved him they gave him great marks on their on their report and then in um in January of 07 I was at home and he calls me up and he's like he's like hey I got like good news and bad news and I'm like well what's the bad news he's like our first task order is only 600k and I'm like we won the [ __ ] contract he's like [ __ ] yeah [ __ ] you know he's like I'm picking you up we're going to celebrate and um so the way the what a task order for people who don't know uh they give you a $300 million contract but that's just like an estimate right they're not actually legally required to give you $300 million in orders um they're only legally required to give you the first order against that and that could be any amount that they want right now we bid the contract on the assumption that we were going to get $300 million in orders with you know the logistics and everything based priced based on that quantity so we at the time we were thinking well you know if uh if they don't order $300 million we're gonna we're going to be screwed we're not going to be able to we're going to be underwater on this we're going to lose money because the logistics is going to be so much more expensive so we were nervous whether they were really serious about giving us $300 million in orders so when they awarded the contract and it was only $600,000 on the first order which is not even enough to like fill up one aircraft load we were like are we screwed are they going to give us another task order or is this it are they testing us on this maybe we need to deliver this at a loss to prove to them but like two weeks later they gave us like a $50 million task order so it was really just what they had available and how difficult was that order to Source uh so we already had all the sources for because we when we bid the contract we got all the sources yeah but um a standard operating procedure was once we'd win thean contract we'd renegotiate everything right so because there's um uh once once they once you win the contract all your suppliers know that if they want this business they have to go through you right so efim would say Hey you know I got the contract um I'd love to give you this business but I have these other offers from these other guys and uh you know you have to at least match them I mean I'm not trying to screw you here I I'll you know I'll tell you what I'll pull my pants down I'll show you their quotes and then he shows the quotes which he doctored and uh and uh and then he would like really you know knock him down in price and uh uh that's how he managed to turn uh a 9% margin at first into a 20% margin wow to 20% on 300 million yeah yeah that was the average that we were making yeah and this was a bunch of different suppliers that yeah it was a whole bunch of different suppliers um we we were getting grenades out of Bulgaria we were getting uh uh the AK-47 ammo famously out of uh Albania and some ammo from the Czech Republic some from Ukraine bet they wish they never sold us that ammo now but but uh yeah we we were getting from all over Eastern Europe yeah yeah we were looking for sources in Kazakhstan and really everywhere so where was this like ammo coming from was it just extra ammo that wasn't being used by the government at the time yes so what most militaries do is they stockpile ammo right just in case right you don't want to if you need that ammo it better be there right you don't want to uh you don't want to have to start production if something happens and and you need that ammo so they militaries tend to stock the ammo but most militaries have a uh a policy that they only are comfortable with ammo that's like maybe 20 years old and then they want to replenish that ammo so then they're willing to get rid of the old ammo for whatever they're they're uh able to get for it because they're they're going to have to pay for it to be destroyed so um Albania at the time uh had was one of the most armed places on Earth because they they had um during the Cold War their dictator was a fervent communist and he he believed that the Soviet Union um poot Bureau was were a bunch of corrupt [ __ ] which he was right about and that they weren't true Communists that they were only in it for themselves and so he pulled out of the Soviet Union and he thought the Soviet Union tends to take a dim view of that and so he thought that the Soviet Union would invade him and he thought because he was such a fervent communist that NATO would invade him too now that he didn't have protection from the Soviet Union so he thought the world's two superpowers were going to invade a tiny little country and so he um Allied himself with the Chinese who he believed were true Communists and um the Chinese gave him uh were they were thrilled to have an ally in Europe and so uh they gave him massive amounts of arms and Munitions which he he built a huge network of bunkers all over the country so that it would be safe from bombardment and he filled those bunkers those underground bunkers with um all the Munitions and weapons that he bought and his plan was what he called total war that if he gets invaded the entire population every man woman and child becomes a soldier and everyone fights to the death that was that was his plan uh the war never happened so after the Cold War ended and by 2007 Albania was trying to join NATO and NATO uses a completely different standard of ammunition and so one of their requirements was that they get rid of all their old Munitions so they were going they were actually paying to get this stuff dismantled um and so they were willing to sell it for pretty much anything so this is um Albania was an extreme case because most countries aren't that stockpiled up except maybe the Russians um but this is a common uh occurrence in militaries all over the world that they stockpile uh ammo for a certain amount of time and then they get rid of it they usually try to sell it on the open market do you think other companies were getting bids from the albanians as well like the same exact thing they our cont the solicitation said that no Chinese ammunition was allowed to be delivered under this contract so probably the other companies knew that the ammo from Albania was originally from China and therefore they didn't bid that we didn't know it at the time so we bid it and we were like oh what a great deal this is really cheap an and the albanians knew yeah um well of course the albanians knew anyone who knows the history of Albania knew it but we didn't know the history they knew that you were in violation of the contract so I'm not 100% sure what they knew I guess if they knew the because it technically didn't violate the Embargo right so there so the reason it's illegal for to buy Chinese ammunition is because in 1989 there was a there was the tianan Square massacre where a bunch of uh thousands of um University students in China and Beijing were protesting for democracy in tianan square which is the main Square in Beijing and the government the Chinese government brutally repress them they like brought in tanks into the square and they killed lots of them and it was on national TV and it was a huge International TV and it was a huge um Scandal and because of that the federal government the US government put the Chinese in on an arms embargo it's illegal for American companies and citizens to do military business with China so however the the ammo that was given to Albania was given to them in the 70s so was before it was illegal while it was legal it was given to Albania if you buy a Chinese AK-47 for example or Chinese ammo in 1988 while it's legal and you import it into the United States in 1990 you could still sell that gun because it was imported legally it's a legal gun right never violated any embargo so the ammo was kind of in the same camp it was in the same category because um it was given to the albanians in the 70s well before the arms embargo existed so technically it didn't legally it didn't violate the Embargo however the solicitation document in our contract said no Chinese ammunition can be delivered under this contract directly or indirectly period right so it's was obviously a reference to the Embargo but the Way It Was Written it was we were not allowed to deliver this ammunition from Albania under the contract because it violated the terms of our commercial contract um so when we discovered it um we we went to go inspect it to to um we actually originally went to inspect it because uh we at the time there was a huge spike in oil prices and uh we realized because we had to fly everything into into Afghanistan by air because it's a landlock country surrounded by unstable countries like Pakistan and um going through there would be very very dangerous because it's controlled by real Warlords right who would love to hijack a uh delivery of uh of ammunition right so we realized the only Safe Way was to fly it in and Air Freight is that like 80% of the cost is fuel so we there was a large spike in fuel prices at the time and we realized we were going to lose money on this unless we were able to reduce the weight and we realized that the ammo was packed in these heavy wooden crates and if we could just take the tins the metal sardine cans they call them out of the wooden crates we would save a large amount of weight and money and shipping so we went over there to inspect it and we saw that there's um Chinese lettering all over the crates and this was the first time we realized oh crap this is probably originally from China and uh we realized this violates our contract now at the time we could have done one of two things we could have said well um we could have gone to the federal government to the Army and said hey you know this ammo doesn't violate the Embargo but the way you wrote the contract we can't deliver it so can you just give us a waiver because we know you meant it just to reference to the Embargo and they could have said yeah we really need the ammo here's a waiver because they were really pressuring us to deliver at the time it was uh like March April of 2007 and uh Afghanistan has a fighting season because they can't fight during the winter they have like these tall mountains and a lot of snow and so they only fight during the spring and summer so if fighting season was starting and our Afghan allies who were fighting the Taliban were running out of ammo and the Army was yelling at us to hurry up and deliver and we we had a whole bunch of delays because we were trying to get you need to get overflight permits to fly any military hardware over every country you fly over you need to get their permission and uh there are some countries who were refusing to give us permission um like usbekistan was refusing to give us permission and eventually I realized well you know if we get hire the Becky National Airline they might give us permission then and that's when they gave us permission when we offered them the the transportation contract there were suddenly we got the uh license to fly over permit and they were the last one but it took us like a good two months two and a half months to get all those licenses and the entire time the arm is like you guys got to deliver you got to deliver this is you know super important people are dying you deliver now now now and so they were really pressuring us to deliver as quickly as possible and so we thought well they need it so badly they'll probably ride us a waiver but then we thought well on the other hand they could also say something along the lines of well it's not really fair to your competitors in the market because they bid ammo that was not originally Chinese Source according to the rules of the solicitation yeah so in the interests of commercial fairness uh we're going to take away this $300 million contract from you and put it out for open bid again you guys are welcome to bid on it again and good luck and we were like take the risk of losing a $300 million contract I don't think they would do that though because it sounds like based on how stringent they were and the whole vetting process that would set them back months it it seems as though you know they have no other choice also your bid if I remember correctly was like $60 million cheaper than the second bid 52 million but yes 52 million still stings so much to think about it yeah yeah we were and they I found out about that because they're not allowed to tell you that um I was talking to the Contracting officer on the phone and and um he was like uh I was discussing various issues with him and and he's like yeah you know I'm happy to help you guys out you guys were just so competitive you know we really uh you know love to see you guys succeed and I'm like really we're really competitive he's like oh yeah you beat the next guys by a lot and I'm like oh how much he's like well I'm not really allowed to tell you this but uh you guys were like 52 million under the next guy and I was like holy [ __ ] I told eim and he was what percentage he was so pissed what percentage $ 52 million this like your 10% off 20% off I think that comes out to about 15 yeah 17% so how' that conversation with e oh he was just like screaming and like kicking the wall yeah he was really pissed he was really really pissed yeah he's like [ __ ] I should have bit it higher should have bit it higher why did I only do %. like well at least you didn't do 8% yeah so then so then what happened to the Chinese ammunition at that point like what was that discussion like right so uh so we were discussing you know like should we ask the government for a waiver and and efim was like he's like nah we're not going to risk it we're just not going to tell them what they don't know is not going to hurt them right we're just going to repackage this and they they won't know they're never going to find out and what he did was he messaged he emailed the um receiving officer in Kabul the one who would be signing off on the ammo deliveries and he told him he's like hey you know uh uh due to the ammo age we want to make sure that everything's high quality and that there's no rust so we're going to inspect every crate of ammo we're going to take it out of its tins just to make sure that it's okay and repackage it in these cardboard boxes um is that okay and he showed him a picture of the cardboard boxes and the receiving officer in couple was like yeah that's that's a good idea you guys um we're really happy that you guys are going the extra mile to do the inspections um and that you really care about the quality sure go ahead and so that gave us the green light to change the the packaging and so we found a a box a cardboard box manufacturer in Albania and uh and asked him to do the repackaging operation a guy named Costa trishka and he hired uh he had you know a factory so he had a bunch of workers and we started repackaging the ammo and then we started uh delivering it into uh into Afghanistan into Pac into um Kabul and uh we were starting to do about like three aircraft loads a week wow yeah and it was starting to go like clockwork we had all the licenses we had all the logistics every the repackaging operation was going smooth and um and then efim was like you know I I'm I'm talk I talked to the Box guy this Costa and uh he has a friend in in the in the ministry of Defense so I'm gonna ask him you know what what what are the ministry of Defense getting paid for this am because we were buying it through a guy named uh Henry to uh he was a Swiss Arms Dealer and uh he had arranged this deal because Henry had connections with the Albanian politicians uh he claimed to be really good friends at the prime minister's son and um so he had arranged this deal and we done business with Henry for a long time uh on other deals uh so uh so he wanted to know what Henry was making and so he um he finds out from the box guy that the ministry of defense is getting paid two cents a round and we were paying Henry 4 cents a round and that really pissed eim off he's like doubling the price and I'm like dude we're settling it to the government for 10 and a half cents around I mean we did have to pay 5 cents around in shipping so we were making one and a half cent in or was it one and a half two and a half cents in profit so uh uh he was like yeah but like [ __ ] that guy he's [ __ ] us over he's doubling it and um and I was like dude we already have a contract we're delivering just like leave it alone we're making money anyway this isn't even the biggest Money Maker in our contract we were making way more money on the grenades which was totally legit it was like uh it was brand new production right off the right out of the factory no repackaging or anything like that nothing Shady going on and we were making way more money on the grenades and on the rockets and and all the other stuff the the AK-47 ammo was actually the it was the biggest volume but it was the profit in the deal and so I said just [ __ ] Let It Go why are you like I don't care we got I you know it's all money it all counts we gotta you know we're I can get this guy out of the deal we're GNA go direct with the mod and I'm like I don't think that's a good idea he's like he's like he's like he's like you just leave this to me and he he flies over to um before he goes to uh to Albania he goes to me he's like okay this is what I want you to do I want you to take those those quotes that you got from Kazakhstan and from the Czech Republic and I want you to change the numbers so it looks like it's less than what they're selling to us so I can use it as negotiating uh leverage and so I mean I edited the PDFs it was relatively simple and I gave him the printouts and so he showed it to Y panari who's the um who's the head of the uh of the U of moo which is the U the government arms export company and Y takes one look at it he's like this is all fake get this get your fake documents out of my face he didn't even take a second look at it he's like yeah he's like I know that's all fake I'm not going to look at it you refused to give him a better price he kept on bugging him I need a he's like I'm telling you if you don't give me a better price we're going to go bankrupt and there goes your contract so you got to give me a better price just to you know I got this other deal that's coming up ahead you're gonna make so much more money on that so give me a good deal on this you know he's using every trick in the book and um y's finally like fine fine fine like I tell you what I'll I'll make an introduction with uh with uh you know the man who could decide this so the next day takes F from in to uh into a um like a construction zone right so this big high-rise building that's being constructed he's walking into this like building that's under construction and walks up these stairs and opens the door and he's in this beautiful like office like all per like beautifully furnished like a wall street style office and inside this like weird under construction highrise and there's this guy you know at the table and the second efim walks in usually he's a very loud Brash talker he realized that he couldn't [ __ ] with this guy a guy named Del yorgi who turned out he was part of albanians organized crime uh but efim could tell this guy you you're not going to [ __ ] with this guy and so delori says like well you know I know that you want a better price we can't give you a better price but I know that you're repackaging the ammunition so and you're spending some money on that so why don't you give us that repackaging contract and we'll make money on the repackaging contract and then we could give you a little discount account off the off the ammo and de's like well sounds like a good deal that guy's fired you're hired and so the Box guy calls me up and he's like hey you know I know that uh you guys are getting someone else to do do the repackaging I understand it's business um no hard feelings but I do have $20,000 worth of boxes you guys are going to need this anyway so why don't you just buy these boxes from me and so I tell e like hey you know we need these boxes let's just buy it and eep's like yeah yeah that's a good idea I'll I'll pay him I'll pay him don't worry about it I get like a week later he's like hey uh he still hasn't sent me the money for the boxes can you talk to him about I'm like efim pay the guy for the boxes ephraim's like ah you know they the new the new guys they don't even want to deal with him they already got the boxes I I don't want to deal with this like efim he knows about everything just [ __ ] pay him 20 grand he's like ah [ __ ] that guy he's not going to do anything and that guy did do do something he got really pissed and he called up the New York Times and he told them everything we were doing and he called up the FBI and told him everything we were doing and his big mistake is that he called his biggest mistake I would say is that he called up the uh the local Albanian press and he told them that the Albanian politicians were getting kickbacks from this deal and then a few weeks later he ended up dead yeah he was in a car very mysterious car crash on uh in a open field with no other cars around uh like a dirt road and he was like thrown 30t from his vehicle and they just found him dead lying lying face down in a field and uh that was very suspicious car crash wow why don't you think he paid the guy like even just to keep quiet like what why was he so against paying this guy so as I said before he's a bit of an idiot savant right so he is and with an enormous uh tolerance for risk so obviously the smart thing to do would be to pay the guy considering the stakes and considering the amounts of money involved $20,000 I mean cons compared to a $300 million contract is just stupid right it's worth the insurance but uh I think in his mind he just he was willing to take that risk and he just I guess it was just another way for him to win he's like I'm G to screw this guy over man there's nothing he could do about it but so did any part of you want to pay the money yourself just to because I mean I didn't have any money at the time CU he kept unrolling my money into the next deal and the Afghan contract needed a lot of financing so all my money was in there yeah just to promise this guy and be like hey listen af's not paying you but you have my word when I get this money I will pay you and here's like $1,000 just for you know my word right I'll pay you well the problem was that shortly after that is he screwed me over and EF screwed me over and then I left the company and I was like how did he screw you over so uh after the after the the flights started Landing in Kabul on a regular basis there were like three to four aircraft a week coming in I think it was like three aircraft of the Albanian ammo and like one aircraft of grenades was coming in a week um and various other things um he he comes in we had like a decent office at that point and and like 15 employees uh we were he was going after all these other deals I told him let's focus on this $300 million contract he's like no we're on a roll we're going to go for everything he's like you can handle this I'm just going to start getting new business and he hired a bunch of people off of Craigslist and started putting them to work in like a like a what do they call that um what Boiler Room that was the phrase I was like yeah a boiler room he had a boiler room going and so he I was I had like you know my own office in in the complex and um he walks into my office everyone else had been gone for the day I was staying late and he goes to me he's uh he like you know a lot of guys around the office are telling me that you're not pulling your weight and I'm like what are you talking about I'm not pulling my weight the Afghan Deal's going he's like yeah yeah the Afghan Deal's going but um you know we've got a lot of problems with one of our Iraq contracts and you're not helping out with that and I said yeah I know because I'm not getting paid on that that's I'm like on a commission only basis I'm not getting paid a salary I I work on I get paid on the deals I work on you want to you want to give me a cut of the of the Iraq contract and he's like ah don't be ridiculous I mean come on I mean you didn't help us win that contract so of course not I'm not going to give you a cut on the Iraq contract but if you don't help us with that Iraq contract then the whole company can go down and there goes your Afghan contract right so you need to help save the company and and I said well why don't you give me a piece of the company then he's like oh well you know I've thought a lot about this and you know you're my best friend and you're the only guy I would ever do this for I Own 100% of AI and I meant to keep it that way but I'll tell you what only because you help me you know build this up and I trust you and you're my best friend and I want you know I really want to do right by you I'll tell you what I'll give you 1% of AI and I said well you know AI 90% of ay's profits are going to be the Afghan contract for this year and I get 2 5% of that so I'd rather get 25% of the Afghan contract than 1% of the company and he's like well take it or leave it you know you can either get that or nothing and I said well I'll see you in court [ __ ] and I walked out and that was and then I got ready to sue him and that that was a probably one of the hardest times in my life because um my daughter had just been born uh she was uh like four months at Old at the time and all of my money was rolled into the Afghan contract so he was holding all my money uh except for like like 20 grand I had left that I was living off mhm and um and I was running out of that quick uh and so I was thinking well I'm like screwed I've got a kid to support I've got no I'm now I'm going to get into this who knows how long the lawsuit is going to take until I see any money from this guy and um so it was a really really I was probably more depressed in that time that i' had ever been in my life because I saw like years of work that I put in just like cuz he kept unrolling my money into the next deal like all that work that I work on zero salary put the last like two years of my life into um would just crumble right before my eyes and um and I had no idea what I was going to do and you know so yeah it was really really hard what was it like having a child in the middle of all of this was it hard to balance it was very difficult because he was very demanding and uh um had uh competing demands from you know the family and and business like I would try to spend time with my daughter and he'd be yelling at me to get to the office and he's like and I'm like dude I'm like here with my girlfriend and my my kid and he's like he's like yeah you know let me tell you something when you're making millions of dollars she's going to be happy you did this you know you got to think the long term bro you know I'm like we already made plans we're going out to dinner he's like [ __ ] that you got to get to the office you got to work right now we got this and this and this and this to do so I was like yeah yeah I didn't always listen to him I never did like never unless it was a real emergency that I thought was really going to matter but he was great at manufacturing emergencies everything was an emergency even like things that were stupid so yeah he I think he just lived off the adrenaline everything had like when things started going smoothly he had to find things that were wrong like he would walk into the office and start yelling at all the other he's like what are you guys doing just chatting I don't pay you to [ __ ] talk get on the [ __ ] computer and make me some [ __ ] money you know he was like that no way he was like very very stressful it sounds like that Afghan deal was going so smoothly that he had to find something in that exactly CU otherwise he wasn't getting a deal if it went smoothly it means that like someone wasn't getting screwed exactly yeah he needed something he needed that he just lived off it what percentage of that do you think is who he was versus just the cocaine and drugs that he was on I think it was mostly who he was because he would act the same when he wasn't on anything I mean not that I knew everything he did but like um yeah I mean he was he would be sober and he'd act the same way he actually had a surprising tolerance for drugs like I would see him like he like cocaine barely affected him alcohol would make him like sloppy and stuff but like he could function uh the thing that I saw him mess him that I saw mess him up the most was uh was sleeping pills why would you why why would he take sleeping pills was it like to sleep so he would like rail Coke and then do sleeping pills to get him to sleep um and he but he was such a workaholic that he would stay on the phone when the sleeping pills started to hit him and anyone who's taking sleeping pills and if you try to stay up it kind of makes your mind start working in a dream state so you stop making you can like start talk you're talking but you don't make sense like your logic circuits aren't functioning and he would be like talking to like a Government Contracting officer and start babbling like things that were like crazy and I'd have to take the phone away from him and i' be like uh you know just he'll get right back to you he's was uh you know um he's a bit a bit tired he's been working really hard on this contract so he he really needs to get to sleep I'd have to like save his ass from just like spouting nonsense yeah that that affected him the most of sleeping bills I would love to see efim and Jordan bord in person do a podcast together that would be insane it'd be interesting epim uh has not done any interview and uh I think he he wants to keep a low profile he doesn't want to be recognized in public I imagine he screwed over a lot of people like a lot of people and probably some people he shouldn't have screwed over so like to be honest I mean I like at this point in my it's been so long ago I wish him the best I honestly hope he becomes like a better person I don't count on it but uh but I do hope that he turns his life around and become stop stops screwing people over left and right and becomes a productive member of society that that's my hope for him I really don't you know hate him or anything anymore um I wouldn't say that I never hated him but um but uh it's always surprised me that no one that he didn't end up dead to be completely honest because he screwed over people that you really shouldn't have screw screwed over you know there's it's always he's Fearless he really is he's like fearless and uh and he screws over everyone and in the arms business so it's always it's always surprised me that that he's still around and kicking it wouldn't surprise me at all if I if something mysterious were to happen to him or if he ends up back in prison that's I'm always kind of like waiting to see that newspaper article let's talk about how we ended up in prison in the first place so when this deal started to turn South what were some of the first signs after he informed me that he didn't want to pay me anything I left the company and uh I was getting ready to sue him and I my lawyers were negotiating with him and uh he agreed to pay me like a severance which was a few hundred K uh which was he owed me millions and millions um at the time he owed me about five million if we had delivered all the way until the end he would have owed me probably about 15 million wow um but I agreed to take like a few hundred K because I just wanted to I had nothing and I was running out of money real quick and I had a kid to feed and and I figured you know few hundred K will at least give me cushion and let me to start something else start something new and so uh I didn't want to fight him years in court I just wanted to move on with my life and so I agreed to that and uh we were literally getting ready to sign the the paperwork to to finalize the agreement and uh uh the day we were supposed to sign it I get a call from one of the secretaries at the office at his office and she tells me she's like hey you know I thought you should know but the feds just raided the office and I'm like the feds I'm like what are they doing they're like well they told us to step away from our computers and to go outside and they're they're boxing up all the uh documents and taking the file cabinets and they took everybody's computer so I thought you should know and I'm like holy crap they know about the Chinese right they know about everything and who else and who knows what else he's doing you know that that I don't know about and so I called up um Alex who was the guy who was um who was um overseeing the repackaging operation in Albania at the time and I told him who was also my best friend we grew up together and that's how I got him involved because I I thought we needed someone who's reliable to do this to manage the packaging operation and uh I told him like Hey you know the feds just raid the office and I mean Alex knew that it was Chinese but he didn't think it was a big deal he thought it was just like a commercial thing it wasn't like a like a criminal thing right um and so he calls up Ephraim and he says uh he he decided he's going to like feel him out right so he calls up epim and uh a guy named Dany answers the phone um uh Danny is the guy he epim replaced me with after I left so Danny answers and Alex says hey you know I need these documents for the aircraft that's coming in today can you get me these documents and because he like I told him that they had that the feds asked everyone to leave the office so he would wanted to see what they would say and so Alex told me that um he hears Dany cover the mouthpiece on the phone and whispered e hey it's Alex he wants to need some documents from the office what should I tell him and he hears efim say uh tell him that uh tell him there was a bomb threat yeah yeah there's a bomb threat so we all had to leave and and we'll get it to him later and that's why we can't get it to him now because there's a bomb threat and Danny gets back and there was a bomb threat so we all had to leave and we'll have to get you those documents later and Alex is thinking well why are they lying to me you know why don't they tell me the truth and maybe it's because ephraim's planning on pinning the whole thing on him he's the guy on the ground 's going to claim I had no idea about any of this this guy Alex you know was just trying to keep his job and you know and did the whole thing without my knowledge and so Alex takes the next plane back to America and he's like I'm not going down for this [ __ ] he wasn't even getting a piece of the deal he was just getting a like a um like a salary and um he comes back and both him and I contact lawyers and we are like uh we tell the lawyers what the issues are and the first thing the lawyers tell us is look in your in your emails and your text messages is there anything incriminating there we did a search for Chinese ammunition in our emails and it there was a lot of incriminating stuff at first we tried to do everything on the phone but because there were all these different time zones and things were very short on time that you had to get this license to this to the logistics company by the time before the air C landed and and uh and you had to catch the end of the of the work day in the US to get things signed by the government so there was like very little time and I was like running on like 20 hours of work and very little sleep and I was like I need to go to sleep I'm just going to write an email and so that's how it got into into email and um there was very incriminating emails like specific stuff like make sure that you remove all the Chinese documentation from the boxes when you repackage it right there's very obvious stuff and so the um the the our lawyers told us well if there's such incriminating evidence they're they probably already have all your emails they don't usually raid they don't usually uh uh do a search warrant until they've already locked down the emails in advance and um so they probably already have all this if they have all this you guys are screwed right I mean you could try to fight it maybe you can get off on technicality but you'll need a few 100K to fight it do you have a few hundred k no well in that case you're probably best off not trying to fight it because the federal government has a 98.5 conviction rate percent conviction rate they went almost all of their cases um and so uh so our lawyers contacted the um uh so the the feds contacted uh our lawyer well they they were trying to get through to our lawyers and um uh they were talking to some of the secretaries and the secretaries told them about about us and then they found us and so our lawyers uh said well you know these guys aren't getting paid they got screwed over by this guy they have no loyalty to him um and so the feds they interviewed us and uh I told them what I knew because the way it works is if you cooperate right you have to tell them everything you know and if you omit one little thing they you get zero credit for cooperating yeah like if they say you knew this and you didn't tell us that or you changed this right now what if you forget about something is there like some wiggle room there it's like I there's so much going on I just didn't think of everything you better hope that they believe it okay if they think that you purposefully forgot yeah then uh then they are not require legally not required to give you any credit at all for cooperating they could tell the judge throw the book at this guy he he was just pretending to cooperate right and we knew we had no chance of winning this case I mean efim wasn't going to pay our legal bills and and um and we didn't have the money to fight it so and anyway we were guilty I mean we knew we were guilty and there was Rock Solid evidence that we were guilty so um we told them what we knew and then they were like you know the the federal agents they were like we're you guys aren't even really a target for the investigation and we knew about the Chinese ammo I mean we found one of the uh we knew most of the stuff that you told us because when we raided the office we found a to-do list on ephraim's desk in his handwriting and one of the items was repackage Chinese ammo so yeah they knew about it um and they're like you guys aren't really a target for the investigation you never made any money from it you're not working on it currently efim is the guy who's making all the money and who's making all the decisions he's really our Target so we're going to do our best not to charge you at all and you guys will just be Witnesses and so we said okay great because I can't afford to get charged here I can't afford a defense lawyer um and and and then nothing happened for like 6 months and efim kept on delivering he kept on delivering the Chinese ammo even even when he knew yeah yeah even afterwards after the raids you were still suing him this was after the settlement so after no so we were about to sign the settlements and then as soon as the the the feds raided the office my lawyer told me you can't take a penny from this guy right now because he's under federal investigation and if it looks like if you get payments from him it looks like he's paying you off and so therefore you can't everything got put on hold would it have been worse for your case had you signed that agreement like a week prior and he paid you and then it's like well technically now you made money from this deal knowingly possibly okay possibly but I will say that efim got to keep most of the money in the end yeah well let's get to that almost all of it so I think it probably would have been better off if I had gotten paid but why was he still delivering if under investigation wouldn't that make him like a wor for his case right so and why wouldn't the government just stop right good question yeah um it came out in court later that the justice department emailed the US Army and told them hey this is Chinese ammo it might be illegal you know it might violate a US law you should stop taking delivery on it the US Army replied to them these emails all came out in court the US Army replied to them the um the mission this ammo is critical to the mission in Afghanistan if you want us to stop taking delivery of it we need a letter from the Attorney General of the United States who's the head of the justice department and that letter never came why it never came I don't know maybe they made a decision that it's better to keep on taking delivery of the ammo maybe it got lost in you know the you know the request got lost I don't know but they the Attorney General never sent an army to uh never sent the US Army a letter asking to stop taking delivery so the US kept on taking delivery so in hindsight it would have been better initially to say hey this was Chinese ammo you still want us to take it like in hindsight that would have been the better option in hindsight we should have told them yes and they if I had to guess they probably would have given us a waiver yeah so what was the raid about if it wasn't about the Chinese so the raid actually was instigated by one of ephraim's competitors saying a bunch of lies about him uh that he would was like doing like like trying to sell uh like Chinese AK-47s and rebranding it as something else which wasn't true and but it was enough to trigger The Raid and uh then they found out it wasn't true but then they discovered the Chinese ammo and everything else that he was doing and to be honest I'm kind of surprised they only charged him with the Chinese ammo because he falsified a whole bunch of documents and things like that I'm curious like let's say during during a raid if they go in saying like he he's he's fake let's say's faking AK47s but they go and they do the raid and they find something else can they just charge him with something else oh yeah found during a raid yeah okay everything is a fair game once they get a um a search warrant anything they find they can use uh even if it was had nothing to do with the search warrant why was the Chinese ammunition an issue when the Army was continually accepting it wouldn't they bear responsibility for that wouldn't that just nullify the whole thing so what happened was they kept on taking delivery of the Chinese ammo and then in March of 20 2008 the New York Times published a front page article about us and it had our mug shots on the front page and it was next to a picture of really rusty looking ammunition and they said that we all the ammo we were delivering was lowquality defective Rusty ammo and that we were putting our Afghan allies in danger and that we were just delivering junk and that we were a couple of kids and it was very irresponsible of the government to give us this enormous contract relying a pivotal component of the war on terror on a couple of 20-year-old Stoner arms dealers so that became a huge uh Scandal Congress held hearings about it Congress wanted us to to to subpoena us to come testify in front of Congress and our lawyers told them well we're just going to plead the fifth the whole time because there's an open criminal investigation and I guess they decided not to go through that whole show so they withdrew their subpoena but um a week after that New York Times article came out the Army said we had no idea about any of this and uh this is uh we're you know we're we're shocked and appalled and we're cancelling this contract and they canel the contract a week after that the justice department uh the federal agents called us up me and Alex and they're like hey you know because of all this political pressure we're going to have to charge you guys even though we said that we wouldn't charge you but uh we just can't charge efim without charging you guys since you were such a a critical component of the operation and so we're sorry but we're going to have to charge him and what they charged us with was uh was the way they put it was with every aircraft delivery of this Chinese ammo we supplied a document right it was called a certificate of conformance and on the certificate of conformance we had to list the type of ammo that was on the plane the quantity of ammo the year of manufacturer and the place of origin and in the place of origin we put Albania and they said well you guys knew that the real place of origin was China and not only did you know you had a whole operation to disguise the fact so the fact that you submitting this document that you knew was fraudulent to the government this is an act of fraud and you guys delivered 71 aircraft loads of this stuff so that's 71 acts of Fraud and each Act can get you up to five years in prison so you're facing 355 years in prison but if you plead guilty we'll combine it all into one so the max you can get is five years in prison and because you're pleading guilty we'll tell the judge hey you know they feel really bad about this they're going to be good citizens from now on and uh give them on the low end the guidelin so maybe he'll do a year maybe nothing who knows you know so that was the choice right it's like plead guilty and maybe get nothing or fight them in court and spend hundreds of thousands of dollars and maybe get the rest of your life in prison and I didn't have hundreds of thousands of dollars anyway so I didn't really have a choice um so Alex and I both pled guilty and Ephraim fought them for like a year or something um and then he realized he was going to lose and eventually he pled guilty as well who wrote the article so it was written by a guy named CJ Shivers uh it was not just him it was like a team of uh people at the New York Times um I think that the point of the article was that they were trying to expose the Bush Administration as incompetent and that they were mismanaging the war there was a lot of similar types of scandals uh you know like the halib Burton no bid billion dollar contracts and things of that nature um so I think that they were trying to the reason so the reason there was a picture of of Rusty ammo on the New York Times on the front page of the New York Times is because we had delivered about 30,000 rounds of ammo sight unseen from Bulgaria because it was offered to us at like a a super super low cost and it wasn't worth to fly it was such a small amount 30,000 rounds that it wasn't worth to fly over there to inspect it so efim said hey this stuff is so cheap if they take it great we make a huge margin if they don't take it it's not so and we had room on the plane cuz there was it was from Bulgaria and the grenades were being loaded on the plane we had some extra room on the plane and so he said well you we already have the extra room on the plane if they if they accept it great will make huge margins if they don't no big deal it's costing us very little anyway turned out the stuff not surprisingly was total crap and rusted and and um it wasn't it was from Bulgaria it wasn't even the Chinese ammo uh but when it got to kab the the the receiving Contracting officer the receiving officer um he looked at it and he's like I'm accepting this crap this is garbage and so he refused to sign off on it and we didn't get paid for it uh but they had no uh ammunition um recycling uh facilities in Afghanistan they didn't know what to do with this stuff they weren't going to pay to ship it out so they just stuck it to the side of the airport and just let it sit there and so when the New York Times went to Afghanistan to investigate and they started asking around about aey Inc and then we see some of the stuff that they delivered someone pointed them oh yeah that's some stuff they delivered right there and so the rest of the stuff had been issued to soldiers in the field and so the stuff that the the New York Times Reporter saw was the stuff that was rejected and that we weren't paid for but why did they start looking into it to begin with what prompted that it was the Box guy told them got yeah because he had it he was very upset about not getting paid that $20,000 they almost thought that that was the Chinese ammunition that you were sending right I assume that they thought that that was the Chinese ammo yeah yeah and what when did you first hear about the article being written so like a week or two before it got published I actually got called up by CJ Shivers the the journalist and he asked me to comment on on he's like oh you know we we're getting a we're doing some investigating and uh I'd like you to get you if you have any comments that about the the Chinese origin of the ammunition and uh I just hung up on him and I told my lawyer and my lawyer's like don't answer this guy's calls don't talk to any journalist the last thing you want to do when you are under federal investigation is talk to journalists because you're just going to get yourself in trouble but isn't that like misinformation pairing old like I guess old photos is fine but also they're kind of making it seem like that is the actual status of what's happening when it was old photos of Stoner you guys paired with you know ammunition that wasn't actually what they were talking about that is true so wouldn't there be something there or are they just allowed to do that unfortunately there's no one uh policing journalists right except other journalists and uh there's no agency that is uh that is in charge of making sure that journalists don't lie or mislead um and to be clear I was I was like I was a fan of the New York Times until this point and then when I saw this thing that was written about me I'm like well this is misleading this is completely wrong this is you know there is a whole bunch of things in the article that was not true and uh and was very damaging um and that really made me a lot more skeptical a lot more um jaded I guess you could say about journalis and one thing I noticed is that after the New York Times published the article uh I had a Google alert out for my name I started seeing my name pop up in uh the in this article all over the world because it got fed to the Associated Press and every major newspaper in the world like 300 newspapers reprinted this article and once 300 newspapers print up an article that's the facts it doesn't matter what comes out later anyone any journalist who writes a follow-up article refers to that original article as fact right so nobody does investigation to see whether what they what the New York Times published was true they just assume it was true because the New York Times published it and you can't say anything because you're under an investigation if you did then yeah I'd get in a lot of trouble with my lawyer yeah and possibly the federal agents yeah you know what's a shame is that the Afghan army they could have used the ammunition that was still going to be delivered but because of this they were actually completely cut off so there were like real world consequences of the the New York Times Like falsifying this information yeah no they were luckily for the Afghan Army at that point we had delivered quite a lot of ammo so they weren't in such a dire situation anymore 71 aircraft floats what happened in your personal life when that article came out oh it was horrible um my uh well my phone started ringing off the hook because every journalist in the world wanted to get comments from me I had to like turn my phone off for a few days um my dad was like crestfall and he was like oh you know I have all my friends calling me asking me if because we have a very unique last name Paco it's I never met anyone with the same last name who wasn't related to me and so he had his friends calling him up asking like people from all over the world that he knew asking if this David Paco guy is related to him if he you know if he know he's like yeah that's my son they're like oh I'm so sorry you know that's your son and so yeah I mean his he was really really crestfallen um and uh yeah I mean I real like I realized that I might be facing like a lifetime in prison so it was it was another one of the darkest periods of My Life um my daughter was just a year old and uh I realized man like I can I can go to prison for decades I can miss my kids's whole life so so and no amount of money is worth that how do you how did you cope with that at the time because I'm sure there's so much unknown in the beginning like how do you sleep how do you function how do you think of anything other than that situation not well yeah it was uh extremely hard extremely hard I barely slept I was uh extremely unhealthy and uh yeah it was it I was under constant stress it was it took um probably a few weeks to get used to it wow yeah it took a few weeks of like just being under constant stress and like thinking oh my God I'm gonna I might go to the rest of my life in prison um and you I was like should I run should I go hide out and like l in America and change my name and be on the run like then I'm going to be stressed out for the rest of my life and be on the Run for the rest of my life but maybe that's better than going for decades in prison and so what ended up happening after all of that in terms of a sentencing and how was structured so epim Alex and I pled guilty and um uh Ralph decided Ralph was our our uh our investor he decided to fight it in court because he thought he could show that he wasn't really involved even though he was but uh and there was email evidence of it so eventually he lost that trial but he decided to take it to trial and because he took it to trial it delayed everything for three years wow yeah because first they had to prepare for the first trial and then there was a Mist trial there was one Jer who refused to convict them and and then they did it again and then they eventually they got a conviction so this is sitting on your shoulders for three years years like if you're locked how how do you I'm curious how do you stay motivated during that time of just thinking like anything I do now might be I don't want to say pointless yeah but like how do I not live it up now because if I could be in jail for the rest of my life I have three years now should travel and live it up and well I couldn't leave South Florida that was part of our bond agreement though we were not allowed to leave South Florida uh so my la suggested hey you should probably do like uh get a job not in the arms business right that makes you look good right so that you want to do everything you can to make yourself look good for the to the judge because the judge is going to decide your life um so I got a job working for a nonprofit at a food bank I thought that was a nice and wholesome and uh you know good citizen kind of job I also went back to school uh because I had quit uh college to do the army thing and I went back to school to study I switched from chemistry to mechanical engineering um I started doing massages again because I needed to make money and um that H that period lasted for three years wow yeah in the meantime Ephraim was just being efim and he kept undoing the arms business and they told him not to as part of because he pled guilty too and so they told him not to stop doing the arms business but he kept on doing the arms business and um he did it the way he did it was he uh Incorporated a new company under like his new best friend's name who because he already screwed over Danny the guy he replaced me with and so he got a new guy to replace Danny with and um a lot of bridges you know yeah and um he the new guy he put Incorporated a company under his name and got him to start doing these uh try to make these deals happen but efim was a real control friend so when it got time to neg and he was a very talented negotiator so like when it got time to negotiate a deal he insisted on getting on the phone himself and saying oh just tell him he I'm an outside consultant and but then like the way he talked it was obvious like he's negotiating you know like this is gu this is the real guy behind the business and and uh through the conversations one of like a gun dealer in like Central Florida um realized who he was I assume the guy did a Google Search and realized that this guy already pled guilty to these uh to these offenses and um he probably thought that Ephraim is trying to entrap him into something in order to get a reduction on his sentence and he probably thought well I'm not going to let myself be in trapped so he went to the ATF right the Alcohol Tobacco firearms administration um the federal agency in charge of regulating arms and he told him hey I got this convicted arms dealer who's trying to do an arms deal with me what should I do and the ATF said oh that's real interesting why don't you uh introduce one of our undercover agents as your business partner and so he introduces him over the phone and the undercover the undercover agent tells him well you know I'm the kind of guy who uh only closes deals face to face so why don't you come up to Central Florida and we could shake on this and do this deal and ef's like oh yeah I totally respect that you know I'm that kind of guy too you know nothing like a good firm handshake to close the deal and so epim gets in his car drives up to Central Florida which he was not allowed to do wasn't allowed to leave South Florida meets the federal agent um the federal agent has like a like a brand new like handgun he knew FM loved guns so he has a brand new handgun he's like hey check this out I got the latest handgun on the market and efim you know takes the gun from he's like oh let me see that thing I been reading about it that looks so cool he takes the the gun from the federal agent he's like let's go off to the to the range because what can I say you know once a gun Runner always a gun Runner am I right and the federal agent slaps cuffs on him and he's like you're under arrest you're felon in possession of a firearm and you can get because he had already played guilty he was already officially a felon you can get up to 10 years in prison if you're a felon in possession in fire of a firearm so he could have gotten and because he uh he violated his bond in South Florida they didn't give him a new Bond in Central Florida so he had to spend like a year in jail uh in County Jail which is pretty bad um waiting to get sentenced and um he could have gotten sentenced to 15 years total five for the original uh fraud and because he pled guilty so they reduced it from 71 to one five for the original fraud and 10 for the gun charge but he hired the best lawyers in Miami spent literally like $2 million on on Roy Black's firm who's the best lawyer in in Miami and they negotiated it down to four years and I think he got out in like three and a half years wow what about your sentencing so for my sentencing I did everything right uh I didn't go back into the arms business did not get caught in a sting operation um I worked at my uh at my uh um good citizen job at the food bank and um the judge sentenced me to seven months of house arrest so I got zero jail time and what was that like for you hearing that just it was like I heard the angel singing like Hallelujah yeah like that it was like my entire life is different now because I was thinking I mean yeah the the federal agents the prosecutor they say they're going to go to bat for you but they were always stressing oh it's not up to us it's up to the judge right the judge makes the sentencing decisions so we're going to say that that you you cooperated and that you pled guilty and and all this stuff and you should get it on the low end of the sentencing guidelines but the judge makes the ultimate decision so um you like I've read stories where the judge is just having a bad day and they're like yeah I know you told me to give him a lighter sentence but I think he deserves something more so I could have gotten a Max of five years that was at least there was the limit I wasn't going to spend decades in prison so there was that which is a huge relief I mean it's very different to do five years than 20 yeah um but even five years is no joke I mean five years of your life is a good chunk of your life uh I was in my late 20s at the time so um and uh and my daughter was uh was three almost four years old at the time so it's like formative years um and uh so when she finally said seven months house arrest that which is what the prosecutors asked for that that's what they uh so my lawyer so the way it works is you your lawyer negotiates with the prosecutor on the propos what the prosecutor is going to recommend to the judge and my lawyer was like well you know we're going to try to get you zero J all time but we probably have to give them something right so let's recommend like seven months house arrest and he he said yeah they just accepted it they didn't even negotiate so like oh we probably could have gotten more it sounds like they didn't really care they really did to do it but they just had to do something yeah so anything you thrw him like yeah that's fine we just we got to we got to make some formalities here and give the media something to say we did a job here that's they weren't even planning on charging me in the first place uh at least that's what they told me but then they felt that they just couldn't charge from without charging Alex and me andal what was it like under house arrest house arrest well I'll tell you it beats prison you get your own shower right doesn't matter if you drop the soap right uh but uh yeah I mean it's it's a night and it's a totally different world you have you have your own fridge and you can just chill on your couch and see your family and friends can visit you was it kind of nice I feel like Graham would love house if you're a home every day is I barely leave the house as it is yeah well so when you're under house arrest you have like an ankle tracking device like they put like a thing on your ankle that tracks where you are and you can't like you can't if you cut it it'll send a signal to inform them that you've cut it and removed it uh you have a um a probation officer who's in charge of monitoring you I once went outside I was living in an apartment uh at the time and I went outside my apartment to like throw out the trash and I get an angry phone call from my probation what are you doing outside of your residence I'm like I'm just throwing out the trash you can't do that you got to get someone else to throw out the trash I'm like okay wa so is it that you literally can't leave the house or is it like a radius around your house so there I mean it does have I don't know exactly how much of the how sensitive it is like how much it knows once you leave but apparently me walking to the garbage shoot that apartment building had a garbage shoot uh they they it was enough for him to know that I had left my apartment and then what happens if you need to leave for a fire or like forgiving I I know but like just you know you have to stay in there say or let's say you have to you have to move and they tell your apartment says hey we're not renewing your lease move and so you could actually leave your house as long as you clear it with the with the probation officer in advance okay so you could actually have a job and you could leave for work so I was at the time I was working as a massage therapist and I was going to school so I just had to give him everything in advance like a week in advance of when I was going to leave and then I could leave the house but I better be back exactly at the time I say and what happens if you hit traffic or something like that or like if you then you get a very angry phone call and if it happens more than once then you are at risk of getting s to so theoretically you could say I'm going to the grocery store next week for 30 minutes yeah and I will be back within an hour yeah and that's okay that's okay as long as you keep to that time got it yeah we to the gym Equinox remember this and some dude had an ankle monitor on and I was curious like if you could go to the gym or do these things and it seems like yeah yeah I mean it's not so bad really it's just the biggest stress is just dealing with the probation officer they tend to be dicks but that's kind of their job did you wear pants all the time uh yeah to cover the thing yeah and a long sock going the other way can you shower with it on like no issues water it's completely waterproof yeah yeah and how's it power do you have to plug it in every now and then charge it I think it had you know I to be honest I don't exactly remember this is like 15 years ago but um yeah I don't actually remember how it was powered it might have been just like a built-in battery or something okay yeah got it yeah it wasn't like a high power device it was just it's literally just doing a GPS signal which is relatively low power and then what was it like for you on the last day or like the day you you're done with house arrest oh it was so nice it was so nice it just felt like you know I'm I'm finally getting a new start at life I was out of the legal system I really wish uh the uh I I I wish the justice system on nobody it's just a nightmare to deal with it's just like it dehumanizes you and it's just it's so crushing experience I mean ever like even small things like like I mean I'm being on house arrest is a completely different world than being incarcerated I'm not even making the comparison being incarcerated is a thousand times worse but even just being on house arrest and having to deal with the justice system is a soul sucking experience I mean you have to go you have to deal with the guy always always uh where you are you can't have anything that's out of your schedule you have to go in and get drug tested every week um yeah and like they always make you make you wait for everything so like you have to be at the thing to at the at the courthouse or whatever to see your your probation office but they'll make you wait two hours even though they say be at this time but then okay now wait for two hours I'm like okay I'm just waiting on my ass doing nothing you know it's just like just it feels like it's just sucking away your life yeah and what part did the movie start to come into play with this so the way the movie happened um was after the New York Times published their article um I was getting phone calls from all the journalists as I said and uh my lawyer told me don't speak journalists but then I got a phone call from Rolling Stone he left me a voicemail he's like hey this is G Lawson I'm a journalist from Rolling Stone I'd love to talk to you this is a perfect article for Rolling Stone my editors are really interested in me writing this article and uh I told I told him like Hey look I'm a musician I've always I've played guitar I'm a singer songwriter I've written music uh I've always W dreamt of being in Rolling Stone but just not for this and he said well you know maybe this will help you you know like I'm happy to write this article about about the story and I said well my lawyer says I can't really talk to any journalists and he said well let me speak to your lawyer I actually used to be a lawyer so maybe I can work out a deal with him and so he talked to my lawyer and um he uh committed to my lawyer that he wouldn't have the article published until all legal Jeopardy was passed and my lurer said well you know as long as he commits to that and follows that which I think he will because he's a journalist for Rolling Stone um uh then he then it's fine as long as he doesn't publish anything before all legal Jeopardy is passed and what he meant by that is I'm out of the justice system uh so it took three years for until he was able to publish that article so he interviewed me he interviewed Ephraim briefly like I think one or two interviews and then Ephraim decided that he wanted to do his own thing and he didn't want to talk to any journalist um so he based most of the article on his interviews with me and he also interviewed people who worked in the government and got their side of things and he dug through a lot of the the court documents and from Ralph Merrill's trial because a lot of Doc Discovery brought a lot of internal documents to light and that's how we discovered that uh the Army knew about the Chinese ammo the whole time because those emails came out and so he did a lot of digging and in 2011 he published this article in Rolling Stone it was one of the longest articles Rolling Stone had ever published because he kept on reworking the article over the years and it kept getting longer and longer as he discovered new things and uh and the article uh got the attention of Todd Phillips who was the director of The Hangover movies and he saw the article and he was like this is a great story I could really make a cool movie out of this um but then he decided that Hangover 3 was a Surefire Money Maker so he decided to do Hangover 3 first and then in 2015 started filming wargs and that's how the movie War doogs came now what was it like when the Rolling Stone article came out did that paint you in a different light and do you feel like that article was fairly written I thought it was mostly fairly written I thought it was by and large accurate uh I think he exaggerated a little bit of our stoner mannerisms because he thought it would be cooler he's like yeah bro Pass the Joint you know like like he he uses some like like uh like slang I forgot what it was exactly he uses some slang that is not like native to South Florida like nobody says like refers to weed in that way and like he used like some of his own slang so like he did a few like edits to like with the dialogue and stuff but I thought by and large it was mostly true got it and how do they approach you with a movie because my understanding is as you said they don't need to pay you anything to use your likeness which I find insane yeah it's crazy yeah so the way it works in the United States is that because you have um the First Amendment freedom of speech as long as you are a public figure which they consider to be anyone who has been written about in the newspapers so you are public which they can write about you without yeah any I mean as long as it's in the public interest right so uh yeah the journalist can write any story he wants right about you for any reason um and so as long as you're in the public record you are considered a public figure and because you're a public figure you could your name can be used in any fiction in any way without with zero but how is how is that not defamation if they don't take your name and they paint you to be like they say you're selling heroin and like mistreating women and children and puppies they could do that you know worship the devil and like all but let's say that damages you and now all of a sudden they paint you in this light that you are this horrible person um isn't that defamation to some degree if now all of a sudden that impacts your life and they've painted you to be a character that not it would definitely damage your life that's for sure um there's got to be repercussions on that but in the United States there's very strong protections from for freedom of speech and the freedom of speech protection extends to Art and art is fiction fiction can say anything they want in the UK they have much stronger liable laws much stronger defamation laws so uh you if you're a UK citizen you could probably Sue um but in the United States you got nothing yeah they don't owe you any they can say anything they want about you they don't have to give you a penny they could use your real name in any movie in any way they want that's that's as long as you're considered a public figure that's that's really the only requirement did you get paid anything to be a part of the movie I did or yeah like were you involved in the writing aspect and creation so the way it happened was um they optioned uh G Lawson's Rolling Stone article right so they were said they were going to base the movie based on the that article and then they offered me a deal where they would buy my life rights they call it uh the rights to my life story they didn't need to do that they didn't have to pay me anything or buy my life rights they still could have used my real name as they did with everim um but they wanted my cooperation because they figured that it would be a lot it would be a better movie if they had some insight from the inside and so the writer Steven Chin the screenr uh flew down to Miami and stayed there for like like a week a week and a half and we met every day and he would like record our conversations and interviewed me and I gave him a huge amount of stories and information and and uh he based the the script on those interviews how accurate was the movie to real life I would say it's about 70% accurate uh it's mostly accurate but there's big chunks of it that are not accurate um as one thing everyone asks me is was the scene going through the tri triangle of death was that real right because it's like so crazy and the truth is is that it is real however uh it didn't happen to us it happened to the writer Steven Shin the guy who wrote the screenplay when uh in I think it was in 2003 or 2004 he wanted to write a screen the reason he got the the contract to write the war doog screenplay is because he had written WR another screenplay called Iraq Iraq about another two Federal contractors who were actually in Iraq doing business in Iraq and he wanted to go interview them in Iraq and so of course there were no commercial flights going to Iraq so he flew into Jordan and he hired a Jordanian driver to drive him to Baghdad from Jordan and his driver stopped in fucha to get gas because no one was Manning the gas stations so he was able to get free gas and then he got chased by insurgents and got shot at and got saved by the US Army that whole scene is real uh but it happened to Steven Chin it happened to the to the screenwriter of the wogs screenplay so when he was writing the screenplay Todd the director he was um he was saying you know these guys are just sitting behind a desk too much we need more action this is Hollywood so why don't you put your story in there the one where you uh got shot at by insurgents in Iraq and so he put his own story in yeah how do you sell your life rights like what does that entail so there are agents who specialize in this kind of thing uh generally they're people who are like literary agents they'll try to sell uh like the the story to a like a article or a book uh and GE Lawson the writer of the Rolling Stone article had a agent who shopped the article around and that's how it uh it got to Todd Phillips desk and um and once they decided to option his story uh um they decided they wanted my involvement and that's when they offered me a deal for my life rights have you noticed a lot of external or like tangential benefits from the movie that have occurred like for example have more doors opened up for you since the movie did paint you in a different light well I'm here on a podcast with you guys so that's pretty good right true you know that's uh that's opened up a up a door here yeah um it's I mean I've had a few negative effects from it um mostly like like I've had a few PE like so in my current uh my current main businesses I I and we can get into how I got into that but um I I create products for musicians I run a company called singular sound that uh we make uh Tech products high-tech guitar pedals and I had one particularly famous artist who um who was very who loved our pedals I mean he was really into I mean we make very Innovative pedals if I say so myself you know but uh it's very unique stuff all patented and high-tech and and um and so he really loved our pedals and he really wanted to be an endorsing artist and and uh and then and he had not know he didn't know I thought he knew but like apparently who was getting ready to do the the review and the endorsement and then he found out about war dogs and he was like well you know my my my uh fan base is like leans on the real anti-war hippie side so I can't really associate my brand with you was this an artist that you looked up to yeah know he was a fantastic artist uh someone I admired a lot and uh I'm not going to say his name you know but uh but uh he was a very wellknown in the mus very well respected in the musician community and um he's like one of these musician musicians that people that like people who are musicians really look up to and um and yeah no that definitely hurt now when that happened throughout the entire process did you have a moral objection to selling War related objects so I had um there were definitely times when I was like uh as far as my relationship with Ephraim goes I was like what am I doing with this with this you know involved with this guy right because there were some things he did that were extremely concerning to say the least to me um one ex one example I mean business-wise obviously personal wise there's a whole bunch but like but um business-wise early on when I first started working with him he um through one of his contacts well I was working on like the propane contract he got a request to arm the king of Nepal right the king of Nepal at the time was facing a uh he had a lot of protests in the streets pro-democracy protests anti an King anti-monarchy protests and the King was shopping for Attack Helicopters riot gear heavy machine guns and Ephraim was just so thrilled he was like we're going to put together a Save the King package and I told him I'm like are you sure that's legal because it sounds like the state department would not approve of you saving the king and helping him mow down Pro democracy protesters and even if it is legal it's kind of [ __ ] up you know that you shouldn't be doing that and he goes to me he's like just keep keep on working on your fuel contracts bro you leave this to me and and I was like whoa I'm like doing I'm like living with this guy practically and doing business with him I'm like you know as as connected as I can be you know business-wise and even personally uh at that point and and this is what he's doing and I was like should I be doing this because you know do I want to be dealing with somebody who is so cool with doing that and so I really questioned myself there that was like a real um moment of of um of uncertainty and and self-reflection and I told myself well he's doing what he's doing you're not going to be involved with that I'm not going to be involved with that so uh so I don't have responsibility I'm not doing that deal um and anyways I'm just gonna I'm just going to put my head down I'm going to work for maybe a year or two make a few million dollars I'll be out and I you know I'm not going to deal with this guy anymore and so if I could just uh just get through just like this bit of hard time then I'll just I'll just make some money and then I could I'll be set I'll be set for life and I could pursue my dreams and I wanted to be like a rock star be able to like start a music career and all that and uh of course these days I think about it and I'm like well what if I had made $15 million on that deal would I have just walked away from that right maybe I wanted to make 50 million or 100 million like when do you walk away from something like that so to be honest I'm pretty glad that it ended up the way it did and I can say I didn't make a penny from that business um not for lack of trying right I'll take responsibility for that um but all the things and maybe this s comes off as me making excuses for myself but the deals I did yes I know my association with him is not exactly something that I should have done but the deals that I worked on were all direct to the federal government and I do believe that um that the federal government was doing the right thing at the time so the people we were supplying arms to were fighting the Taliban and I don't feel bad about that you know I don't feel bad about arming Afghans to fight off the Taliban which is a brutal theocracy who uh forbids women from getting education and kills people for getting out of line and wearing the wrong head scarf and stuff I'm like yeah [ __ ] those guys you know has has your view on war changed since then people ask me oh do you feel like that you were that it was the morally wrong thing to do to be in the arms business and my philosophy on it is a gun could be used to kill somebody it could also be used to defend yourself from getting killed so it really depends uh it's it's a tool it's not a indicator of moral culpability so it really depends on what the guns and the the weapons and the ammo is being used for if it's used to defend people from someone who's trying to oppress them I think that's a good thing it's not only a neutral thing it's a good thing um if it's used for bad things then it's a very bad thing um we all would love for there not to be War right I mean not all of us right maybe some Ephraim probably he did love war because he made him a lot of money I think in general uh most people would agree that war is a bad thing and that uh uh we should not have War unfortunately human nature various reasons there are Wars and you have to defend yourself when someone attacks you and you need weapons to do that because you can't defend yourself without it also how bad is government waste when it comes to spending it could be pretty bad um it could be pretty bad uh the the is issue with the government and the reason they have all these complex rules right uh about Federal Contracting and is actually one of the reasons that a lot of uh companies are put off from doing Federal Contracting is that the government has a lot of uh hoops and loophole not loopholes um Hoops that you have to jump through there are some loopholes and that's that's uh something you learn while doing the business it's a big pain in the butt right to deal with the government and the reason for that is because they have a million and one regulations uh and they do that in order to reduce government waste because the people working in the government they're not spending their own money right it's not like you know you own your company and you want to get the best deal because it's your money and if you don't spend that you're if you if you get a bad deal you're that's money out of your pocket right if you're a government official um then uh if you spent more than you should have on that thing it's not your money right if there's a situation where the government needs a particular thing right like um uh uh let's say uh laundry services or something right and they really need it badly and so they're going to be willing to pay a lot of money in order to get it done in the time frame that they want but that's not it's so people will see it as waste right because the government paid twice as much as they should have but to them at the time the timing was more important than than the price right so there are so people will be like oh you know the government spent uh $600 on a on a roll of toilet paper or like NASA spent $2 million to develop a a pen that works in zero gravity while the Russians used a pencil right that's that's a famous story right um there are sometimes good reasons for that uh with with the pencil by the way thing what's the reason for that is that pencil shavings are horrible in zero gravity it gets into all the filtration systems and ruins your spacecraft so you can't have don't you have those little those the sharpeners that just kind of trap it I had those in yes but there's but little flakes in zero g can flake off and get into the system you can breathe it in and and it could be a real nightmare got it so yeah I mean I didn't know that yeah I still feel like there's other ways around it but I mean maybe but and and uh maybe there is but they made that decision that we need this so therefore they they it turns into like okay these are the requirements how much money is required to get to those requirements and that's where you have situations where where you have what appears to be gross overpayment and and occasionally it is gross over payment but sometimes there are other factors like maybe there's only one bidder there's only one there's a huge supply shortage and this is the only guy who has it and he knows it and because the system is that they'll take the uh the best value he knows he's the only bidder he could bid whatever he wants right and the government has to take it because he's the only game in town so the government still needs it and they have unlmited money practically right they print the money so they're willing to pay whatever it takes to get that thing yeah we've heard stories about just the government giving budgets and if you don't use all of it you're not going to get the budget in next quarter so it's like you want to use all of it and then say Oh we need a little more more money the next one that is a big element of it that is a big element of it because if you don't lose if you don't use your budget they reduce your budget the next year so yeah there is an incentive for the for the um uh government officials to use up their budget but they do still have to do it within the guidelines and the rules of the Contracting system which is why those rules were set up how do you think the government is flawed and what changes would you recommend they make to operate more efficiently uh they could definitely simplify things a lot it's actually quite complicated right now um and I think that it's so complicated because there because there's layers of rules that get built on top of layers of rules and there's a lot of different competing interests right so uh for example there's something called The Jones act any stuff that is delivered to the government within like the United United States has to use a US built and operated vessel right now the United States doesn't really build that many ships anymore right so that law significantly increases the cost of things and complexity of that operation but that law was put in I don't know like the early 1900s but they just never got rid of it so it's like a law that has just been on the books and that everyone has to follow and is just a huge pain in the butt and significantly increases costs um and there's another law that a certain percentage of clothing that you deliver to the government the cotton needs to be grown in the United States and the labor needs to be done in the United States now a lot of this clothing isn't even manufactured in the United States anymore so that stuff also increases the cost of the government because they have all these rules that you need to follow and it's because you have all these layers and layers of rules that have been built up over centuries uh it's pretty complex to deal with the government which scares off a lot of businesses um um and uh that's why uh a lot of businesses don't um they don't want to deal with the government and that is actually a big reason why there's a huge opportunity for middlemen like us right because you can the government wants to buy X Y and Z and some of those items the companies that make them don't want to do uh business with the federal government they don't want to deal with it right so it opens up the opportunity for a middleman to make them a better offer and you know jump through those loopholes so what's changed since the whole expose on that article that came out on you has the government changed the way they do contracts so I've been banned from doing government contracts for about 15 years um recently uh got off the band list uh I think it was in 2022 um but I haven't gone back into Government Contracting it's uh but from uh the people who i t talk to who are in Government Contracting some of my new business partners um say that there's not much change it's pretty much the same thing they changed the website mainly made it worse uh but uh but it's almost the same exact system if someone wants to copy what you were doing how do you learn how to do that like what do you look for the best thing to do is to specialize in something that you know really well right but you have to learn the government system which is why uh I started a new online course called War doogs Academy I partnered up with two guys who were actually inspired by the War doogs uh movie to start their own government contracting business and they contacted me because I have a lot of people who contact me they're like oh you know uh I'd love to I'd love to do what you did teach me what you did I'll give you 90% of the profits just teach me everything and I'm already I'm doing other businesses I don't have time to teach every guy who contacts me I have literally hundreds of people contacting me so um uh a guy named Logan uh contacted me out of the blue and said you know I watched my partner James and I we watched uh the movie wogs when we were 21 years old and we were super inspired by it and we figured if these guys could do it why can't we do it and so uh you know I just wanted to let you know that we were you know you were very inspirational to us and we now have a multi-million dollar government contracting business and they wanted to uh expand their business into uh areas that I was familiar with like the arms business and I said to them well you know you guys are up to date you know all the Government Contracting system I haven't done this in 15 years but uh why don't we start something to teach people how to do this because I have a lot of people who want to learn how to do Government Contracting there's $6.7 trillion dollars that the government spends um so there's an enormous opportunity one of the biggest uh challenges in Government Contracting is finance because you need to you need to pay your supplier for the items that you want to supply to the government you need to pay the shipping company and then you need to wait 30 days right so it's a big step a big stumbling block about that people fail when they when they even when they win the contract oftentimes they can't deliver so we have a network of investors who want to fund government contracts so so not only are we going to teach people how to do Government Contracting we're going to support them to actually build the business and be successful at it and build it for the long term in the right way in the complete legal way so that it actually last what's the ROI for investors like what's the investment look like Logan and James when they won their first contract they got loone sharked hard for two months of financing they borrowed $90,000 and they had to pay $37,000 in interest so that I mean that's loone sharp r love to see is you know how there's a website where you could bid on contracts a website where investors could bid on investments like that that's a great idea you know yeah I think I don't I you got to make it gr dude imagine that because I'm thinking to myself if they're getting pitched at like 40% I'm like hey I would take a risk at this for 30% and then maybe Jack is like you know what I like this I'll do 27 and then you you bid it down but the investors going to be happy with it and they're going to be happy because they get a better rate right no that's true that's true and uh we will probably implement some element of that into our our war dogs Academy Community I want 5% of that idea though just put the money in uh so our current goal is to launch in mid-February mid-February yeah we're planning on launching in mid-February people can sign up to the mailing list now uh to get informed of when we're going to launch but uh yeah we're almost finished with all the course materials we're just polishing it at this point cool we'll put any links down below yeah when is the last time you spoke with efim maybe in 201 15 16 something like that um we had a deposition and he walked in and he's like hey great to see you I'm like [ __ ] you you know like I'm you owe me millions of dollars now you're pretending to be my friend you know go [ __ ] yourself so um you know and that was pretty much it how was he able to keep his money do you know how much money he kept by the end of it all so I estimate because I know how much he delivered right I know he delivered around $67 million on that and he got paid for it and he was making on average like a 20% margin so he probably made you know what is that like uh 15ish million dollars but part of his pleading guilty he wouldn't have to relinquish any profits when you were convicted of fraud right they base the penalty on how much money you defrauded people out of now the government didn't get the fraud out of any money right in fact they saved $ 52 million or they would have saved 52 million if they had kept Go the whole contract uh so the only claim of financial loss that the government had was the cost to cancel his contract and put it out for bid again and they estimated that to be I think it was like uh like about 300 something thousand dollar that's what they estimated at so he had to pay that back to the government about like 300 something uh but he got to keep everything else wow and how did efim respond to you when you kind of gave him the cold shoulder when he was trying to be warm to you he was like oh okay just and you don't have any desire whatsoever to to see what he's up to or to I mean to like hang out with him and talk not to hang out but just to contact him and just like I mean I've I have no desire to be in contact with him in any way um if he came to me and said hey David I feel really bad about what happened here's all the money I owe you right I hope we you we can put this behind us I would give him a hug and I'd say all this forgiv him how much would that be if he's watching this right now and he's like okay he's taking notes yeah about $5 million okay so we Round Up to 5 million bucks and an apology yeah that and hug then then we'll be best friends again You' hang out with him smoke some weed maybe absolutely absolutely I don't think it's ever going to happen you know if every everything I know about him is he's not that kind of guy but if he has changed that drastically as a person that he would be willing to actually apologize and to make amends including financially obviously because that's what really counts because he's willing to say anything you know uh then yeah absolutely I I don't I really don't have like hatred for him him or anything I used to I'm not saying that I'm I'm like some sort of Saint or anything I used to hate his guts there were there was time when I seriously thought about killing him you know I'm not that kind of guy but like but like I hated him that much you know when someone steals you know all the money that you've been working for for two years and you thought was going to set you for life and youve you're like you know about to go broke and got a kid to feed you're pretty [ __ ] pissed you know you know you have some pretty bad feelings towards that guy right but um you know 15 years have passed sure and uh I'm in a pretty good situation in life now very happy with uh you know where I am in life now and my businesses are going great I've got new business like War doogs Academy coming up and yeah so I'm doing great in life I I I'm I don't really Harbor like resentment towards him I you know I don't have I don't think about him really except when I'm telling the story uh but if he if he wanted to make amends that's what he has to do he has to pay me the money he owes me and apologize and admit he was wrong and then we'll be best friends again would you ever go into business with him again if be apologized but he apologized gave you the money back and said Hey listen I got this new business idea you're the guy for it I changed here proof would you do it that would be a tough call that I mean I will say that if he actually apologized and paid me the money he owed me I would be so incredibly shocked something seriously changed yeah that he's like a really different person now which would completely blow my mind right uh I would be so incredibly shocked that I would actually consider it okay I don't know if I would but I would very strong he's to follow it up with we just need a $5 million loan you're you're no no I'll tell you if I did that I would lawyer that deal out the ass I mean my I would probably hire two different law firms to just check each other's work to make sure I'm covered in every angle you're going to roll it in though fund this 5 million and then it's going to turn into 20 no I would never do yeah I would never throw my money in there but I would I would consider going back into business with him if he apologized paid me the money I had and of course I had the best lawyers in the bus to broker This and like bring Eon and to see if we can make something happen you it would take five million dollar yes I know but I'm just saying if we could convince him why do you think he because oh cuz he pissed people off and he doesn't want the danger of of going on and show yeah he doesn't want to be he doesn't want people to know what he looks like you know I imagine he doesn't want did he change name no I don't think so imag a pretty yeah it's it's not a common name but um but he he I I believe he never rents an apartment under his own name and I know that because people Ralph the our investor tried to sue him because he screwed Ralph like he screwed everyone else he literally stole millions of dollars of Ralph's money Ralph invested I think 1.5 million into aey not only did he not give Ralph the profits that he owed him he never even gave him the principal he literally stole all of Ralph's money Ralph was destitute like he's an older guy he like really destroyed his life and so Ralph was trying to sue him but he just couldn't find he couldn't serve him because he just couldn't find where he lived like he hired a private investigator that's insane yeah so he I think he like rents he could have moved somewhere no no he was living in Miami we we knew that he was around so yeah you have to go to such extreme lengths like no social media oh no he has no social media well he has an Instagram account that uh I think hasn't been active since like 2017 yeah but like not anything in your name nothing registered to you yeah electric bills car insur like everything has to be is he still doing the contract business do you think uh so the last I heard and I just heard from people who you know friends of friends uh is that his main business now is funding lawsuits no way yeah because he's been sued so many times and he's sued people so many times that he knows the lawsuit industry really well and so he funds lawsuits and I'm sure he takes all the money so I would never want him to fund my lawsuit wow against him that's that's a creative business because lawsuits are very expensive a lot of people have claims that they just can't afford to pursue mhm you know I mean that makes sense yeah no it's a good business it could be a very good business uh as long as because you know what you're doing right if you know the legal system really well and you know the merits of a lawsuit and how strong it is and which I'm sure if if he gave the lawsuits the same attention as he did the arms government business I'm sure he could sniff out this is a good case 80% win rate I'll fund this yeah I I and he's probably going to take 90% of the money or more yeah because otherwise you get nothing exactly you know it's like would you rather 10% of something or 100% of nothing and then he'll probably take the last 10% at the end somehow you know so I'm sure he does um yeah no I'm sure he's very successful I I have no doubt that he's making a lot of money and some of that money is mine but he's sitting on it you know what can you do I I'll tell you my I would have a a a a total head explode emoji type of situation if he actually apologized and paid me the money he he or if anyone knows epim yeah this is what it takes and we would love to help I know people who know him I mean I the people who who still see him once in a while by all accounts he's the same guy so I I could be wrong I hope I'm wrong I honestly hope that he's grown as a person and and become a better person and a less damaging person to be around and uh stop screwing over everybody and burning all his Bridges I really hope and that would be a great thing for everybody not just him I be particularly good for all the people he would have screwed over but um I really hope that's the case I just highly highly doubt it all right thank you so much David for coming on really appreciate it such a pleasure likewise thank you guys for watching check out the links Down Below in the description our lovely sponsors and also all of David's links thank you so much next next time