A New Jersey man is facing charges of federal wire fraud for an alleged scheme to sell $45 million worth of personal protective equipment that prosecutors say he didn’t have.
Ronald Romano, a Manalapan, N.J. used car salesman, was arrested for supposedly attempting to deceive and price gouge New York City into buying personal protective equipment that he didn’t own or have the authorization to sell. Along with three co-conspirators, Romano attempted to exploit the city during the COVID-19 pandemic while hospitals and frontline workers faced shortages of PPE, federal prosecutors claim.
“As alleged, used car salesman Ronald Romano saw the current health emergency as an opportunity to cash in, using lies and deception in what he envisioned as a get-rich-quick scheme. Romano allegedly lied repeatedly about his authority and ability to sell large quantities of personal protective equipment to the City – equipment he knew was desperately needed for use by frontline medical workers and first responders,” U.S. Attorney Geoffrey Berman said in a news release. “And he allegedly offered to sell this phantom equipment to the City at grossly inflated prices. Now Ronald Romano’s short-lived second career as a purveyor of vital protective gear is over.”
Romano is being charged with one count of conspiring to commit wire fraud, one count of wire fraud and one count of conspiring to violate the Defense Production Act starting in February this year. He faces more than 30 years in prison on all charges.
3M sued Romano in early April for misrepresenting a business relationship as his company, Performance Supply, priced N95 respirators at 500-600% over 3M’s listed price.
In the scheme, Romano and his co-conspirators began negotiating with a Mexico-based company in February to purchase face coverings and other PPE for resale, the complaint claims. In March, Romano created a false authorization letter that falsely represented that his company Performance Supply was authorized to sell millions of 3M’s branded PPE. Brokers acting on his behalf also approached New York City and in negotiations, Romano and others “repeatedly made false and fraudulent representations regarding, among other things, their authority and ability to supply 3M-brand PPE manufactured in the United States, and their track record in other PPE deals,” federal prosecutors allege.
Romano also claimed to have listed a PPE deal with the Florida Division of Emergency Management that never occurred.
“At a time when the pandemic was ravaging New York City, this defendant greedily preyed on the city’s desperate need for protective equipment to stop the spread of the virus. But, instead of reaping millions of dollars, the scheme received a dose of old-fashioned, New York City skepticism from procurement specialists at the city’s Department of Citywide Administrative Services (DCAS), when the city called the supposed manufacturer to confirm the astronomical asking price,” DOI commissioner Margaret Garnett said.
Garnett said the case “demonstrates there is no tolerance, at any time, in particular during this crisis, for individuals who seek to victimize this city by holding essential workers’ safety hostage to price-gouging and fraud.”