ISSA & PPE Fraud Coalition Request Congressional Assistance to Address PPE Fraud

February 1, 2022 ISSA & PPE Fraud Coalition Request Congressional Assistance to Address PPE Fraud

The PPE Fraud Coalition, in conjunction with ISSA, requested U.S. congressional assistance to address fraud related to personal protective equipment (PPE).

The coalition sent a letter to U.S. Senators Richard Blumenthal (D-CT) and Marsha Blackburn (R-TN), the Chairman and Ranking Member, respectively, of the Senate Subcommittee on Consumer Protection, Product Safety, and Data Security ahead of a February 1, 2022, hearing on “Stopping COVID-19 Fraud and Price Gouging.”

In the letter, ISSA Director of Government Affairs John Nothdurft described the COVID-19-induced urgency for PPE and how this demand, combined with restricted travel, forced many companies to modify their normal processes for vetting new PPE suppliers–to aid U.S. end-users. “This created both opportunity and financial incentive for fraudulent transactions by foreign suppliers. In many cases signed contracts required significant down-payments and large bank transfers to guarantee orders.”

The letter goes on to state how a significant number of PPE-related contracts were “simply abandoned without products delivered or refunds offered. In other cases when contracts were fulfilled, counterfeit, substandard, or even soiled products were sent.” According to CNN, “A months-long CNN investigation has found that tens of millions of counterfeit and second hand nitrile gloves have reached the United States, according to import records and distributors who bought the gloves and that’s just the tip of the iceberg. Criminal investigations are underway by the authorities in the U.S. and Thailand.”

Specifically, the coalition requested that Congress investigate and hold a hearing to look deeper into how these fraudulent actions have impacted U.S. businesses and employees, as well as see that the “criminals, who have defrauded U.S. citizens and companies,” be prosecuted.

Rob Williams of the R.L. Williams Co. and a PPE Fraud Coalition member said, “The pandemic was used by some foreign businesses to take advantage of American companies directly, but more importantly, they have taken advantage of Americans at all levels. Local, state, and federal governments failed to secure orders. Front line workers failed to secure products. American citizens were exposed. We know many other American businesses have been affected in a very similar fashion. Many of these companies are also experienced importers who face significant financial distress. This fraud continues to be rampant, and these bad actors are still defrauding American companies. We need the U.S. governments support to help highlight this issue and hold these businesses accountable by their governments.”

Tim Morgan of International Sourcing Group Ltd. and a PPE Fraud Coalition member said, “In Asia right now criminals are using COVID-19 precautions and travel restrictions as shield against prosecution. The systematic fraud and corruption on every level have made it hard to find a path forward to hold bad actors accountable and most importantly to get the money or product back. PPE fraud needs to be addressed and the conditions that allowed the large-scale fraud to occur need to be fixed. To accomplish this all governments and business organizations need to find ways to work together to root out bad behavior from the system.” 

For more information about PPE fraud, visit ISSA will continue to monitor and advocate for its members and the cleaning industry on this issue. For questions about PPE fraud, please contact ISSA Director of Government Affairs John Nothdurft.