Authorities said a Queens, NY, businessman was running a large fraudulent operation centered on selling millions of counterfeit N95 masks to clients, which included an unidentified healthcare system in the southern United States that unwittingly paid $700,000 for the fakes.

Now, Zhi Zeng, 34, faces charges in connection with a scheme that a Department of Homeland Security official called one of the “worst of the worst” of the nation’s scams built around personal protective equipment (PPE) during the COVID-19 pandemic.

3M, parent company of Top 40 promotional products distributor 3M/Promotional Markets (asi/91240), produces the authentic N95s, which have been in huge demand during the pandemic because of their ability to protect against coronavirus spread.

Authorities said they seized 1.7 million counterfeit masks from Zeng’s warehouse. They discovered the operation through a tip and infiltrated it using undercover officers who posed as buyers. Authorities maintained that boxes at Zeng’s warehouse bore 3M’s name. The boxes were stacked to the ceiling.

“They look like the real thing, they feel like the real thing,” said Queens District Attorney Melinda Katz at a virtual press conference, the Daily News reported. “The only way to find out that they were relying on these no-protection-at-all boxed up masks … was through this investigation.”

Authorities are investigating to see who was manufacturing the masks. More arrests could be forthcoming.

The case against Zeng comes on the heels of federal authorities announcing on Wednesday, Feb. 10, that con artists have distributed millions of fake N95s to healthcare workers in at least five states. That includes revelations that hospitals in Washington state found out that their supply of masks contained frauds.

3M said it’s been working tirelessly with law enforcement to combat the sale of counterfeit masks. The Minnesota-headquartered corporation asserted that it has reported 11,000 cases of counterfeit masks that have led to 29 civil lawsuits. 3M said it’s seized 10 million fake N95s. Its efforts also include helping to prevent the state of Minnesota from buying nearly 500,000 counterfeit N95s from a Florida company; 3M sued that company and won an injunction.

“We have taken very strong steps around attacking the problems of counterfeiting or price gouging. And that has occurred over the last year in this constrained supply and very strong demand environment on critical products such as the N95,” Mike Vale, who leads 3M’s safety and industrial business group, told CNBC.