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NEW YORK (Reuters) – A New Jersey used car dealer was criminally charged on Tuesday with exploiting the coronavirus pandemic by trying to defraud and price gouge New York City into buying N95 respirator masks in a roughly $45 million scheme.
FILE PHOTO: Various N95 respiration masks at a laboratory of 3M, which has been contracted by the U.S. government to produce extra masks in response to the country’s novel coronavirus outbreak, in Maplewood, Minnesota, U.S. March 4, 2020. REUTERS/Nicholas Pfosi/File Photo
The U.S. Department of Justice said Ronald Romano, 58, sought quick riches in late March when his Performance Supply LLC tried to sell 7 million of the 3M-branded masks to New York City’s Office of Citywide Procurement for about 500% above the typical list price.
Prosecutors said the Manalapan, New Jersey, resident created a bogus letter falsely showing that 3M Co (MMM.N) authorized the sale.
He was also accused of offering to sell 3 million Mexican-made N99 face masks to Florida’s Division of Emergency Management for $5.46 million, a more than 500% markup.
Prosecutors said Romano’s intentions were clear from a March 9 text to an accomplice: “I’m working on a few deals that if I get any of them you might be buying a Ferrari.”
They also said that after being warned on March 31 the FBI might investigate suspected price gouging, Romano responded: “I thought we are a free market of supply and demand?”
Mark Macron, a lawyer for Romano, declined immediate comment. Romano faces wire fraud and two conspiracy charges. Two counts carry maximum 30-year prison terms. Bail was set at $200,000 in an afternoon teleconference.
“Ronald Romano saw the current health emergency as an opportunity to cash in,” U.S. Attorney Geoffrey Berman in Manhattan said in a statement. “Now Ronald Romano’s short-lived second career as a purveyor of vital protective gear is over.”
3M, the world’s largest maker of N95 masks, on May 4 won an injunction against Performance Supply’s sale of them. The St. Paul, Minnesota-based company has filed at least 10 similar lawsuits.
William Childs, a 3M senior counsel, said the company was happy to see law enforcement’s continued involvement.
Reporting by Jonathan Stempel in New York; Editing by Matthew Lewis and Tom Brown
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