Accused New York Mask Hoarder Is First Charged Under Defense Act

(Bloomberg) -- A New York businessman became the first person to be charged with violating the U.S. Defense Production Act for allegedly hoarding tons of personal protective equipment including masks and surgical gowns and price-gouging.

Amardeep Singh, 45, stored the equipment at a warehouse on Long Island and sold it from his store in Plainview, U.S. Attorney Richard Donoghue said Friday in a statement. If convicted, Singh faces as long as a year in prison, Donoghue said.

In response to the Covid-19 pandemic, President Donald Trump on March 18 issued an executive order making it illegal to hoard medical supplies and devices which the U.S. has designated as scarce or sell them at excessive prices.

Bradley Gerstman, Singh’s lawyer, said his client wasn’t aware he was breaking any federal law.

“This Defense Production Act is a very general law which lacks any specificity on what exactly price gouging is,” Gerstman said. “Once all the facts are laid out, you will see that my client didn’t violate the law. We deny any wrongdoing that my client gouged on any profits. He’s innocent and will be cleared.”

Singh, who prosecutors say is also known as “Bobby Sidana,” began hoarding the protective equipment in mid-March and created a section in his store for “Covid-19 Essentials,” Donoghue said. The equipment included N95 masks, currently prioritized for health care professionals, as well as surgical masks, face shields, gloves and disinfectants, Donoghue said.

Singh sold three-ply disposable face masks for $1 each, after having bought them for 7 cents -- a markup of about 1,328% -- Donoghue said, citing records seized from the store. Bulk sales were made to organizations serving vulnerable senior citizens and children battling the virus, according to the records.

Singh “saw the devastating Covid-19 pandemic as an opportunity to make illegal profits on needed personal protective equipment,” said Craig Carpenito, the U.S. Attorney for the Eastern District of New Jersey who also heads the U.S. Department of Justice’s Covid-19 Hoarding and Price Gouging Task Force.

U.S. postal inspectors seized 23 shipping pallets containing more than 100,000 face masks, 10,000 surgical gowns, 2,500 full-body isolation suits and more than 500,000 pairs of disposable gloves at Singh’s warehouse.

The Nassau County Department of Consumer Affairs had issued a citation to Singh’s businesses for selling the N-95 respirator masks without proper labeling, reselling outdated models and for repackaging individual masks in Ziploc bags and reselling them.

The New York State attorney general sent Singh a cease-and-desist letter on April 1, warning him about selling hand sanitizer and other goods at “unconscionably excessive prices,” prosecutors said.

Singh is scheduled to surrender and make an initial appearance before a federal magistrate in Central Islip, New York, next week, according to John Marzulli, a spokesman for Donoghue.

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