Efforts to crack down on fraudulent 3M respirator salesmen and middlemen netted their first criminal case this week.
Efforts to crack down on fraudulent 3M mask sales ended with a first criminal case this week when a used car salesman was charged with trying to bilk New York City out of $45 million.
“You really don’t want to be the guy who turns down 100 million masks by not taking a phone call,” said Luke Bosso, the chief of staff of Indiana’s economic development corporation, who has been charged with vetting suppliers. “It’s incredibly scary. In Indiana... we get 50 emails a day offering N95 masks.”
“Disappointingly, it’s not a small problem,” said Courtney Enloe, 3M’s vice president of litigation. “We’re agnostic as to how it’s stopped. Whether it gets shut down because we file a suit and get an injunction, or it’s passed on to state or federal authorities, we just want it shut down.” “3M does not – and will not – tolerate individuals or entities deceptively trading off the fame and goodwill of the 3M brand and marks for their personal gain,” attorneys wrote again and again in the company’s resulting civil suits.
The setup was distinctly international, according to the complaint. Romano promised to source masks through a Mexico-based company and a Peruvian-based exporter working with a company in the Netherlands to procure masks made by 3M in Uruguay. The same group had successfully reached an agreement with Florida Division of Emergency Management officials to buy masks at a 500% markup for $5.4 million, the complaint says, but were not able to find a supply of the face coverings. They did successfully sell $12,000 in masks to a naturopathic medical university at a 360% markup, according to the unsealed complaint. University officials sought to return the three-ply masks, the complaint says, because they were of inferior quality.
“If someone says they can access 2 billion masks you immediately have to question it given [3M] has just recently ramped up production to 1.1 billion masks in a year,” Enloe said. He said the offer came with some telltale signs of a possible scam: a newly created company with a tiny, unsophisticated online presence and aggressive sales tactics encouraging the state to act quickly to avoid missing out on the deal.
USA TODAY reached out to Puznak on a phone registered to him. The man who answered said he was not Puznak, but would pass on a message. He hung up and no one ever called. He placed an order early on directly with 3M. The products were on backorder, but Smeykal says he decided it would be better to wait for 3M than deal with an unknown middleman. Smeykal compared the chain of events to hurricanes, when vendors suddenly pop up to take advantage of desperation. With storms, needs usually include things like food and cleaning supplies.
Most of the traditional vendors in Adelberg’s supply chain are still out of masks, forcing the clinics to overpay for critical supplies. Recently, they paid $1,460 for 60 masks –more than $24 apiece. Before the pandemic, the same N95s went for about $2. King Law Center director Sharon K. Dudley told USA TODAY that she “acted in good faith,” referring other questions to her attorney, John Brennan.
“We had no idea where the third party was getting whatever they were selling through us,” Eisenberg said. “This was an unfortunate situation.”
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Surveillance video does not support police claims that George Floyd resisted arrestSurveillance video from outside a Minneapolis restaurant appears to contradict police claims that George Floyd resisted arrest before an officer knelt on his neck
Read more »
‘Midnight Rider’ Director Randall Miller Faces New Arrest Warrant Over Probation ViolationsEXCLUSIVE: Six years after Sarah Jones was killed on the Georgia set of Midnight Rider, director Randall Miller is facing being arrested again. Law enforcement authorities in the Peach State today …
Read more »
CNN Journalist, Crew Released After Arrest While Covering Minneapolis UnrestPolice arrested CNN journalist Omar Jimenez and his crew on air early Friday during a live broadcast in Minneapolis, as they covered riots sparked by George Floyd’s death, sparking intense outrage …
Read more »
Arrest, lawsuits provide glimpse into coronavirus price-gouging playbookN95 mask maker 3M ramped up efforts to hunt down flimflammers and fraudsters in March. Now, they’ve filed a raft of trademark suits and helped prosecutors build criminal cases against those trying to illegally profit on the pandemic.
Read more »