NY AG James Sues Buffalo Businessman Over Alleged N95 Mask Fraud
The lawsuit, the first personal protective equipment fraud case filed by the Attorney General's office in connection with the pandemic, is part of a broader investigation into fraudulent and deceptive solicitations by people hoping to profit off the pandemic, according to the office.
June 12, 2020 at 11:22 AM
3 minute read
N95 masks and medical surgical masks. Photo:
Maridav/Shutterstock.com
New York State Attorney General Letitia James on Wednesday sued a Buffalo-area businessman, accusing him of fraud related to crucial personal protective equipment amid the coronavirus pandemic.
The lawsuit, the first PPE fraud case filed by the Attorney General's Office in connection with the pandemic, is part of a broader investigation into fraudulent and deceptive solicitations by people hoping to profit off the pandemic, according to the office.
According to Wednesday's complaint, which was filed in New York County Supreme Court, Frank Borgese and his company, Impact Medical and Surgical Solutions, offered to sell 3M-branded N95 masks and other gear to New York state and a variety of health care providers, even though they had no authorization to distribute 3M-branded masks.
On March 31, with COVID-19 cases rising in New York, Borgese informed New York officials that he had thousands of N95 masks "[c]oming from 3M Minnesota, estimated delivery within 3 days."
3M is a Minnesota-based company, but Borgese did not have the masks or any way to obtain them, according to the complaint.
On April 6, he offered to sell the masks to the state at $5.95 per mask, more than four times 3M's list price, according to the complaint.
New York state never bought any masks from Borgese, according to the complaint, but at least three health care providers sent him hundreds of thousands of dollars and received no masks. Their payments were eventually refunded, according to the complaint.
Borgese's alleged fraud was foiled by some other health care providers, which sought verification of his relationship with 3M.
In one case, an employee of the Massachusetts-based health care system Baystate Health emailed 3M in April to ask about Borgese's offer, noting that the "price seems high but we are willing to pay since we are in desperate need." 3M confirmed that Borgese was not an authorized distributor, according to the complaint.
Borgese and Impact Medical did not immediately respond to requests for comment Wednesday.
According to his LinkedIn profile, Borgese has worked in the medical sales industry for years.
In a statement, James said the lawsuit should serve as a warning.
"We won't allow anyone to take advantage of New York State during this unprecedented moment," James said. "As frontline health care workers desperately searched for the proper PPE during the coronavirus pandemic, Frank Borgese and IMPACT Medical tried to profit off New Yorkers' dire needs by selling lies. Not only did he attempt to sell products at exorbitant rates, but he did so without the ability to deliver on these attempted sales."
The complaint asked the court to require Borgese and his company to each file a $2 million performance bond with the Attorney General's Office to guarantee that he comply with any injunction. The proceeds of the bond could also serve as a restitution fund for victims, according to the complaint.
Read more:
Long Island Man Charged With Hoarding, Price Gouging in Violation of Defense Production Act
Brooklyn Prosecutors Say 2 Men Demanded $4 Million for Masks in Coronavirus-Related Fraud Scheme
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