WASHINGTON ( CNN ) -- U.S. investigators are looking into accusations that a company hired by the U.S. military supplied corroded and decades-old Chinese ammunition to the Afghan Army and police . Efraim Diveroli , 22 , is president of AEY Inc. , an arms dealer suspended by the Defense Department . The U.S. government has suspended AEY Inc. of Miami , Florida , for violating its contract , according to U.S. Army documents obtained by CNN . The Army and House Oversight Committee identified the president of AEY Inc. as Efraim E. Diveroli . He is a 22-year-old whose father started the company as a small printing company , according to WFOR-TV , a CNN affiliate in Miami . Watch father describe 'boy genius ' » . The government is conducting a criminal investigation into allegations that AEY Inc. knowingly misrepresented what the company would provide the Afghan security forces . Under the contract , AEY said it would supply ammunition manufactured in Hungary . But an investigation by the Army found most of the bullets were made in China , a violation of the contract , according to the Army documents . U.S. regulations bar companies from purchasing weapons or ammunition from a Chinese military company directly or indirectly , according to U.S. military officials . U.S. government investigators took numerous photographs of the ammunition showing that it was improperly packaged and corroding , according to the Army documents . The Department of the Army , the contracting authority for the government , sent a letter to Diveroli on Wednesday informing him that he and his company were suspended from contracting with the U.S. government until the investigation is complete . The Army documents show that since 2004 the company entered agreements with the U.S. government that totaled about $ 10 million . The papers also reveal the company struck it big in 2007 with contracts totaling more than $ 200 million to supply ammunition , assault rifles and other weapons to the Afghan National Army and Police . When that ammunition arrived in Afghanistan , U.S. officials were contacted because of its unsatisfactory condition . Army criminal investigators were sent to look at the packages in January . They took hundreds of pictures showing ammunition dumped in deteriorated and broken cardboard boxes and wrapped in plastic , according to the Army documents . The documents also reveal ammunition was corroded and made in China from 1962 through 1974 . According to U.S. government regulations , the alleged misrepresentation by AEY could bring a fine , five years imprisonment or both . Additionally , if AEY is found in violation of the contract the company will be permanently barred from doing business with the U.S. government . The House Oversight Committee plans to hold a hearing into the matter on April 17 . `` The hearing will examine the company 's financial history , past performance and compliance with U.S. law and government contracting regulations , '' the committee said in a statement late Thursday . The hearing also will examine `` the federal government 's efforts to investigate allegations that AEY may have violated U.S. law and government contracting regulations , '' the committee said . E-mail to a friend .
AEY Inc. is under investigation for reportedly dealing in Chinese ammunition . According to government contract , company did not buy munitions from the Chinese . Government memo : " awarded AEY contracts worth in excess of $ 200 million . " Reports reveal ammunition arrived in China late , poorly packed .