FBI Discovers Promised Stockpile of 39 Million Medical Masks Was a Scam

As state governments and hospitals have scrambled to obtain masks and other medical supplies during the coronavirus pandemic, scammers attempted to sell a fake stockpile of 39 million masks to a California labor union.

The Los Angeles Times first reported on Sunday that the FBI had uncovered the scam, which has been traced back to a broker in Australia and a supplier in Kuwait. The investigators discovered the scam because they were looking into whether the supply could be intercepted by the federal government through the Defense Production Act.

The Service Employees International Union-United Healthcare Workers West (known as SEIU) promised at the end of March that it would make the millions of masks available, as government agencies and hospitals planned to purchase some of the supply. But as the FBI investigated, it became apparent that the union had been duped, although no financial transaction had yet been made.

"There are opportunists who are looking for any victim," U.S. Attorney Scott Brady told The Times.

N95 mask
Close-up of N95 respirator mask during the coronavirus pandemic in San Francisco, California on March 30 Smith Collection/Gado/Getty

Hospitals and medical professionals have struggled to find adequate supplies of personal protective equipment (PPE), which includes masks and other gear to protect doctors and nurses treating individuals with COVID-19, the disease caused by the coronavirus. In many cases, hospitals have asked staff to reuse supplies as the number of patients has surged while stockpiles have dwindled.

Some have tried to exploit the pandemic for financial gain, as appears to be the case with the fake stockpile of 39 million masks. Health professionals have said that the costs of masks and other equipment have skyrocketed as the need has outpaced the available supply.

"Prices for simple things like masks have gone up by 10 to 20 times. Normally an N-95 mask would cost my hospital somewhere around 40 or 50 cents. Current going rates are $5 to $7 per mask," Dr. Megan Ranney, a professor at Brown University who practices emergency medicine, told CNN at the end of March.

A man in Georgia was arrested last Friday after allegedly attempting to defraud the Department of Veterans Affairs (VA) when negotiating purchase orders for critical medical supplies, including millions of N95 respirator masks. The man wanted to charge the VA $7.50 per masks when they typically cost just 50 cents each.

Agents from the California Department of Justice also confiscated large stockpiles of medical masks and supplies kept in warehouses in Alameda County last Tuesday. About 50,000 – including 1,000 N95 masks – were reportedly confiscated from just one of three warehouses.

"The agents seized numerous N95 respirators, surgical masks, and other items," the press office of California's Justice Department told Newsweek following the raids.