Two Houston-area men have been indicted by a federal grand jury for negotiating a deal to sell 50 million non-existent N95 masks to a foreign government in an attempt to defraud it over $ 317 million, officials said Tuesday. federal officials.
The men, Paschal Ngozi Eleanya, 46, and Arael Doolittle, 55, have each been charged with one count of conspiracy to commit wire fraud and two counts of wire fraud, according to the Attorney General’s Office. United States for the Southern District of Texas. If found guilty on all counts, each of them could face up to 45 years in prison.
Mr Doolittle was taken into police custody on November 20 and his arraignment was set for Wednesday. Mr. Eleanya, who surrendered to the authorities on Tuesday, is due to be arrested on Monday.
None of the men’s attorneys responded to requests for comment by phone and email.
In a court hearing on Tuesday, the targeted foreign government was identified as New South Wales, an Australian state, Reuters reported. According to the indictment, the two men were trying to sell 50 million N95 masks, manufactured by the company 3M, at five times their public price. They expected to pocket $ 275 million in the deal until federal authorities halt a wire transaction before it is completed.
Mr Doolittle, who was identified by The Houston Chronicle as an executive of an energy company, had been accused in another case of attempting to defraud 21 investors out of $ 1.2 million through transactions oil and gas, according to court documents. This case is expected to be tried on December 14.
The case involving masks is just the latest case to point to the world of fraud and scams lured by the massive amounts of government money involved in tackling the coronavirus pandemic.
In recent months, federal officials have accused people of trying to steal more than $ 175 million from the Paycheck Protection Program, and the Federal Trade Commission has reported more than 200,000 cases of fraud, theft Identity and other Covid-19-related scams from January 1 to November 24.
Trying to sell non-existent masks isn’t a new concept either. In April, a Georgian man was charged with wire fraud after being accused of attempting to defraud $ 750 million from the Veterans Affairs Ministry in exchange for 125 million masks and other protective gear.
California officials on Tuesday exposed a scam involving pandemic unemployment claims totaling hundreds of millions of dollars that were made on behalf of tens of thousands of inmates and inmates across the state. Officials said the scheme “appears to be the largest fraud on taxpayer funds in California history.”
The United States Attorney’s Office for the Southern District of Texas said in March that it had made “detecting, investigating and prosecuting anyone who attempts to exploit the anxiety and uncertainty surrounding the Covid-19 epidemic to defraud other people ”.
On Tuesday, Ryan Patrick, the US attorney for the Southern District of Texas, said on Twitter that the indictments came after a months-long investigation by the office’s ‘Covid fraud official’ Justin Martin, the deputy US attorney pursuing the case. against Mr. Eleanya and Mr. Doolittle.
“PPE fraud and price gouging are still relevant”, Mr. Patrick said, referring to personal protective equipment. “Report it when you see it.”