Law enforcement, PPE manufacturers step up efforts to stop scams
As healthcare providers start turning to secondary markets due to shortages, investigators find that many products are unreliable or fraudulent
WASHINGTON — A dire shortage of N95 respirator masks and other medical equipment and supplies due to the coronavirus has some health care providers and states turning to secondary distribution markets — and finding out that they can be unreliable and, worse, fraudulent.
Minnesota-based 3M is in the fray on the issue as desperate hospitals are left in the lurch and turn to the multinational giant for help, sometimes armed with misinformation fed to them by the fraudulent suppliers.
3M, Honeywell and other legitimate manufacturers have been working with law enforcement and attorneys general offices since the COVID-19 outbreak in the U.S. became acute and exacerbated shortages of protective medical supplies.
Now, both 3M and law enforcement are becoming more organized in their efforts to fight the fraud. 3M has set up a hotline to help streamline its efforts and is investigating every instance it knows about, said Denise Rutherford, the company’s senior vice president of corporate affairs.
Minnesota Attorney General Keith Ellison and Erica MacDonald, U.S. attorney for the state, on Monday launched a centralized new Minnesota COVID-19 Action Team (MCAT) to investigate and prosecute COVID-19-related price-gouging, medical equipment scams, cyber crimes and hate crimes.
“Scam artists are exploiting public anxieties surrounding COVID-19 to victimize consumers,” Ellison said.
The action comes days after Ellison’s office sued and shut down the online retailer Dragon Door after it began selling “KN95” masks made in China that were advertised as authentic N95 masks.
The N95 masks are highly coveted because they filter out 95% of all particulates, and 3M makes the majority of them.
The FBI and the Centers for Disease Control and Prevention (CDC) have issued fraud alerts for several weeks on what to look for — both in sales pitches and in checking if any products delivered are actually knockoffs.
Fakes often sport misspelled words, inappropriate labels and come with ear-loops or a single string unlike approved N95 masks. Customers also should know what the required approvals are for devices and make sure the correct ones are in the materials.
The Better Business Bureau, which is offering anti-fraud webinars, on Tuesday issued a warning that the frantic hunt for masks, gloves and other equipment to protect against COVID-19 has produced “the perfect storm for scam activity.”
In Minnesota, consumers have alerted Ellison’s office of suspected “impostor” masks being sold online and also of ordering N95 masks online “from what turned out to be a bogus seller who took their money and ran,” said John Stiles, Ellison’s deputy chief of staff.
The AG’s office also has received price-gouging complaints after companies received e-mails or ads offering to sell N95 masks at $10 a piece instead of the $2 standard price. Others offered, gloves, hand sanitizers, nose wipes and other supplies at inflated prices, Stiles said.
Ellison said he is now working with mask and gown maker 3M Co. and with other attorney generals to stop scams involving all manner of personal protection equipment (PPE).
Massachusetts Attorney General Maura Healey has a task force to fight fraudulent PPE offers. New York Attorney General Letitia James also is fighting complaints.
Last week, hospitals around the nation such as Holy Name Medical Center in Teaneck, N.J., reported receiving shipments of masks from distributors that had to be returned because the respirators failed to fit properly or meet medical specifications.
Last week, as 3M was in negotiations with President Donald Trump’s administration to increase the number of N95 respirators available in the U.S., there were reports that the company might have been involved in fraud.
Jared Moskowitz, Florida’s head of emergency management, first said on Twitter and then on Fox News that 3M was using distributors that allegedly had accepted payments from foreign entities to divert the N95 respirators to other customers overseas.
3M denies wrongdoing and is working with Moskowitz, his team, law enforcement and Florida Gov. Ron DeSantis to identify the offending distributors.
“To our knowledge, this is not a situation where there was an authorized 3M distributor involved at all,” said Rutherford, the 3M senior vice president. “We are very concerned about people being taken advantage of.”
Rutherford said any complaints of “unscrupulous practices” are taken seriously and investigated to see if the offender is a valid company and if the product involved is produced by 3M.
3M’s new customer hotline has allowed the company to more quickly identify how to investigate the complaints and to help customers evaluate the legitimacy of a given offer, said 3M spokesman Tim Post.
For example, North Carolina-based Premier Inc., which helps find supplies for 4,000 hospitals and clinics, recently called 3M to verify if a salesman was legitimate because the caller said he could deliver large numbers of N95 masks immediately.
3M helped determine that the call was a fake, Post said.
Other customers’ questions involved e-mails, some supposedly from 3M representatives, offering products if money is sent upfront. “They are just conducting a financial fraud scheme,” Post said. “They are just trying to steal some money.”
3M took the unusual step Sunday of denying a news report. First reported in the Financial Times and picked up by others, the story falsely purported that a shipment of 3M personal protective equipment in transit from China to Berlin was diverted in Thailand and redirected to the U.S.
“3M has no evidence to suggest 3M products have been seized,” the company said. “3M has no record of any order of respirators from China for the Berlin police.”