The 39 million N95 masks the Service Employees International Union announced it had discovered turned out to be an elaborate scheme, according to the FBI.
In late March, the union rushed out a press release:
The union launched an exhaustive search for masks and other personal protective equipment (PPE) five days ago in response to pleas from frontline healthcare workers that they need more protection and feel unsafe on the job as they treat the growing number of COVID-19 patients. SEIU-UHW has 97,000 members who work in hospitals across California.
Within 48 hours of painstakingly calling leads and potential suppliers, the union discovered a distributor who had the 39 million masks, and has since found another supplier who says his company can produce 20 million more masks a week. The union also has found a supplier who can deliver millions of face shields.
The union didn’t identify the alleged distributor.
Now, the FBI claims the union was “duped” in an elaborate scheme, the Los Angeles Times reported.
U.S. Atty. Scott Brady of the Western District of Pennsylvania said FBI agents and prosecutors stumbled onto the arrangement while looking into whether they could intercept the masks for the Federal Emergency Management Agency under the Defense Production Act. …
Brady said investigators tracked the tip back to a Pittsburgh businessman, who said he had been working with the union to secure millions of masks, some of which were purported to be sitting in a Georgia warehouse. Brady said the businessman had been using WhatsApp to connect with a broker in Australia and a supplier in Kuwait, who are both now the target of a federal investigation.
Brady said the union and the Pittsburgh businessman, whom he declined to identify, appear to be among a string of middlemen who were fooled. The union and the Pittsburgh businessman are not under investigation, Brady said.
The paper reported union President Dave Regan said the organization had “successfully purchased the masks and that workers would soon be receiving them.”
In March, the union said the masks would be sold for $5 apiece.
According to U.S. Attorney Brady, the Pittsburgh businessman said he was buying the masks at $3.50. It’s not clear who intended to pocket the difference.
“As far as we knew, he had legitimate masks,” SEIU spokesman Steve Trossman said, the paper reported, “and the people who were going to purchase those masks were going to fully vet it and check it out and do their due diligence.”
“We believe we disrupted fraud,” Brady said.