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Mahwah Company Admits Price Gouging KN95 Masks During COVID-19 Pandemic

By rlsmetro on
Mahwah

A Bergen County company today admitted its role in price gouging a chain of New Jersey grocery stores in connection with the sale of KN95 masks during the COVID-19 pandemic, Acting U.S. Attorney Rachael A. Honig announced.

According to Acting U.S. Attorney Honig, TSC Agency LLC (TSC), a logistics and freight forwarding company based in Mahwah, pleaded guilty to an information charging it with price gouging in violation of the Defense Production Act.

According to documents filed in this case and statements made in court:

In March 2020, TSC and two partners purchased 250,000 KN95 filtering facepiece respirators from a foreign manufacturer. 

TSC and one of those partners then sold 100,000 masks to a chain of New Jersey grocery stores at prices in excess of prevailing market prices. TSC sold the masks for $5.25 per mask, which amounted to a markup of more than 400 percent from its acquisition cost. 

Before the spread of COVID-19, TSC had no history of selling personal protective equipment.

A violation of the Defense Production Act carries a maximum fine of $200,000, or twice the gross pecuniary gain derived from the offense, or twice the gross pecuniary loss sustained by any victims of the offense, whichever is greatest. Sentencing for TSC Agency is scheduled for April 13, 2022.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across the government to enhance efforts to combat and prevent pandemic-related fraud. 

For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form.