Feds Charge Santa Rosa Attorney With Conspiring to Inflate Prices on Surgical Masks
Kent Bulloch, 56, was charged alongside an Arizona-based businessman by federal prosecutors in Brooklyn who claim the men were seeking to profit off the pandemic by reselling the masks.
April 28, 2020 at 05:35 PM
3 minute read
The original version of this story was published on New York Law Journal
A Santa Rosa lawyer has been charged with violating the Defense Production Act by conspiring to inflate the price of masks needed amid the coronavirus pandemic, according to a complaint unsealed Tuesday in the Eastern District of New York.
Kent Bulloch, 56, was charged alongside an Arizona-based businessman, 64-year-old William Young Sr. Both men are accused of seeking to profit off the pandemic by reselling the masks, according to court filings and a news release. Bulloch also agreed to create fake documents to hide price gouging, according to the complaint.
Bulloch didn't immediately respond to a request for comment.
"It's hard to believe anyone could take advantage of a situation like this, but this case clearly proves that theory wrong," William Sweeney Jr., assistant director-in-charge of the Federal Bureau of Investigation, said in a statement.
Bulloch told a potential investor that he had access to 12 million masks, including 1 million KN95 masks and 11 million surgical masks, according to the complaint. Two suppliers who were also involved in the scheme and claimed to have access to millions of masks were charged with conspiracy to commit wire fraud Monday, according to court filings.
Millions of dollars involved in the scheme, including commissions hidden from the alleged buyers, was supposed to go into Bulloch's trust account, according to the complaint.
The trust account would preserve buyers' privacy, Young told an undercover agent who had suggested he was hoping to profit off the masks and "flip" them at a higher price.
Young also told the agent that he didn't care how much the agent charged for the masks, according to the complaint.
The agent then raised concerns about the appearance of price gouging, and Bulloch agreed he'd be willing to send false invoices and a letter showing that the agent had bought masks for a price closer to the eventual resale price. Bulloch created an escrow agreement claiming resale profits would not exceed 10%, according to the complaint.
The charges against Bulloch and Young follow another Defense Production Act case in Brooklyn federal court. On April 24, Long Island shop owner Amardeep Singh became the first person in the country charged with violating the law in connection with the coronavirus. Singh, who is accused of hoarding masks, gloves and other items and selling them at a markup, will await his trial on bail, officials agreed during a hearing Tuesday.
Craig Carpenito, U.S. attorney for the District of New Jersey, is coordinating nationwide enforcement of the Defense Production Act and other crimes related to personal protective equipment as the leader of the COVID-19 Hoarding and Price Gouging Task Force, according to a news release.
"The Department of Justice will not allow greedy profiteers to take advantage of the public during this health crisis," Carpenito said in a statement.
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