November 25, 2020
Feds Stop Alleged $317 Million PPE Fraud
Two Houston area men now face conspiracy and fraud charges for the scheme that involved nonexistent N95 masks from 3M.
Two Houston area men are accused of attempting to scheme a foreign government out of $317 million in a fraud centered on N95 masks, which are produced by 3M, parent company of Top 40 promotional products supplier 3M/Promotional Markets (asi/91240).
Paschal Ngozi Eleanya, 46, and Arael Doolittle, 55, face charges of conspiracy and wire fraud for allegedly trying to sell 50 million 3M model 1860 N95 respirator masks to the unidentified foreign government.
The catch? They did not possess the masks.
Eleanya and Doolittle expected to pocket $275 million, with the remaining money going to brokers and representatives for the foreign government, according to reports. The alleged conspirators were exploiting the high demand for N95 masks during the COVID-19 pandemic and charging five times 3M’s public list price for the in-need respirators, authorities said.
According to investigators, the foreign government wired funds to complete the purchase of the phantom masks, but the authorities stepped in to stop the transaction before it could finish.
Eleanya turned himself in on Tuesday, Nov. 24. Authorities arrested Doolittle on Friday, Nov. 20.
Assistant U.S. Attorney Justin R. Martin is prosecuting the case in the U.S. District Court for the Southern District of Texas. If convicted, both Doolittle and Eleanya face up to five years in prison for conspiracy and up to 20 years in prison for each of the two counts of wire fraud. Each of these charges also carries a possible $250,000 maximum fine.
Ryan K. Patrick, U.S. attorney for the Southern District of Texas, said Tuesday that his coronavirus “fraud point person has been investigating this case for months. Glad to finally see it come together. … PPE fraud and price gouging is still a thing. Report it when you see it.”
Justin Martin, my COVID fraud point person, has been investigating this case for months. Glad to finally see it come together.
— US Attorney Ryan Patrick (@USAttyPatrick) November 24, 2020
PPE fraud and price gouging is still a thing. Report it when you see it. https://t.co/rGDLFv6itU
The public is asked to report COVID-19 fraud, hoarding or price-gouging to the National Center for Disaster Fraud’s (NCDF) National Hotline at (866) 720-5721 or visit The Department of Justice’s NCDF website.