As the coronavirus (COVID-19) pandemic stretches the limits of the health care system, demand for certain medical equipment is far outpacing the supply of these items. This shortage creates a ripe environment for scammers. Even businesses, medical providers and government agencies have fallen victim when trying to obtain ventilators, personal protective equipment (PPE) for health care workers, and more, according to a new warning from the Federal Bureau of Investigation (FBI).
The FBI reported that several state and local government agencies “wire transferred funds to fraudulent brokers and sellers in advance of receiving the items. The brokers and sellers included both domestic and foreign entities. In one case, an individual claimed to represent an entity with which the purchasing agency had an existing business relationship.
“By the time the purchasing agencies became suspicious of the transactions, much of the funds had been transferred outside the reach of U.S. law enforcement and were unrecoverable,” the FBI said.
The FBI is warning the public specifically about advance fee scams and business email compromise (BEC) scams related to PPE procurement. Advance fee scams involve paying in advance for goods or services and receiving nothing or very little in return. This is frequently a component of online purchase scams, the subject of more than 3,000 reports to BBB Scam Tracker so far in 2020.
In April 2020, a St. Louis woman told BBB Scam Tracker she had paid an online business more than $200 for what were advertised as N95 respirator masks with filters, but received low-quality cloth masks with no filters and no manufacturer information.
In BEC scams, fraudsters hijack a legitimate email address or use a nearly identical email address and ask victims to make payments to a fraudulent bank account or by email. BBB received about 30 reports of BEC scams so far in 2020 and published an in-depth investigative study on such scams in 2019—and that study can be found at bbb.org.
Scammers are taking full advantage of the high demand for medical equipment that can treat COVID-19 patients or mitigate the spread of the virus. Not even business, medical or government entities are immune to this fraud, and they should exercise due diligence and caution when making their public health purchasing decisions.
Tips for businesses or agencies purchasing PPE:
If the seller claims to have a business relationship with your organization, contact someone you know at the business. Do not use contact information provided in an email or phone communication, as it may be fraudulent. Verify that the sender’s email address matches the sender’s name or title, especially in emails sent from a mobile device.
If possible, have a third party pick up the items in person to verify they are physically present and as advertised. If not, payments should be made in escrow so they can be released to the seller when the correct items are delivered.
Be wary of last-minute changes in wiring instructions or recipient account information. Confirm any changes in payment instructions independently with the company before proceeding.
Report any scams to BBB Scam Tracker.
BBB has consumer tips on COVID-19 at bbb.org/coronavirus and business tips at bbb.org/covid.
For assistance, go to bbb.org or call 573-803-3190.