“The procurement for PSA was not done at all as usual,” said Charles Tiefer, a professor at the University of Baltimore who specializes in federal procurement. “Overall, the government does not use brokers. It goes to the suppliers. With VPL in mind, Zelonka increasingly focused on its potential partnership with the Florida venture capitalist, with whom it had signed a joint non-disclosure agreement among PSA dealers. When an end buyer, such as a hospital, pays $4.50 or more per mask, Rick B. said, “It usually means it`s a brokerage chain. It is a broker who knows a broker who knows a broker. “I know a guy, and I`m going to ask Jerry to call you and get up for a penny.” That means 10 cents per mask. NEW YORK – New York Attorney General Letitia James today announced an agreement that will prevent a fraudulent broker of personal protective equipment (PPE) and other medical supplies from selling PSA and test kits related to the 2019 coronavirus disease (COVID-19) as New York and the rest of the country continue to fight the spread of COVID-19. A draft consent order and decision submitted to the New York State Supreme Court aims to settle a lawsuit filed last month by Attorney General James against Frank Borgese and his company IMPACT Medical & Surgical Solutions (IMPACT Medical) by excluding Borgese and IMPACT Medical from the sale of PSA and COVID test kits by January 2023 and allowing them only to: resume PSA`s sales business afterwards, when everyone deposits a $100,000 bond. Borgese and IMPACT Medical sought to exploit psa`s desperate need at the beginning of the COVID-19 crisis by trying to sell governments and healthcare systems N95 and KN95 ventilators they did not and could not provide. As with wars or natural disasters, third-party providers such as GlobalGeeks and SZN occur when demand exceeds availability.
Ms Ley`s company, Life Partners, was founded in May 2020 to “provide Covid-related products” and helped broker two £258 million deals between Hong Kong-based Worldlink Resources and the UK government. “There are outrageous brokers out there. There are people who make me want to take a Silkwood shower at the end of the day,” said Rick B., referring to the classic film about radiation exposure. “There are brokers who buy at $3 and mark it up to $6 or $7.” Intermediaries and intermediaries are a common feature of PSA transactions. Manufacturers in China often use local brokers who then turn to people from other countries to help them sell to customers. This can contribute to the total cost of the products. In Virginia, retired Army Captain Hans Mumm said a foreign PSA salesman contacted him this spring to help him negotiate a deal with the Bureau of Prisons for protective coats. Currently, there is a global rush for personal protective equipment such as medical masks.
This has led to intellectual property issues such as mislabelling, counterfeiting and fraud (see our article here). There are also fundamental contractual issues, as governments and health facilities seek to analyze legitimate sources of personal protective equipment (“PPE”). Some of the usual checks and balances in government contracts and tendering procedures for PPE have disappeared from the window in the face of the COVID-19 pandemic. Many PPE have been successfully purchased, but agreements have also been made to purchase PPE without any follow-up. This article deals with contractual issues and remedies in relations with suppliers who cannot or do not want to deliver. These considerations may apply to any purchase agreement, not just PPE contracts. GlobalGeeks filed a counterclaim in June against SZN LLC, a second-stage intermediary in the deal that negotiated the transaction from an apartment in Brooklyn and worked on a U.S.-Asian commission, the lawsuit says. NEW YORK – New York Attorney General Letitia James today filed a lawsuit against a broker of personal protective equipment (PPE) and other buffalo medical supplies for repeated and widespread fraud during the 2019 coronavirus disease (COVID-19) public health crisis. The lawsuit accuses Frank Borgese and his company – IMPACT Medical & Surgical Solutions (IMPACT Medical) – of fraudulently promoting New York State, as well as hospitals and healthcare systems across the country, with fake offers of much-needed PPE, including 3M N95 respirators.
Borgese and IMPACT Medical took advantage of PSA`s desperate need by trying to charge governments and healthcare systems exorbitant prices for counterfeit items or products they could never deliver, potentially giving Borgese and his company the opportunity to make millions of sales. He and others have described to me a “chain of daisies” of middlemen who have become rich during this pandemic and transformed masks from one private buyer to another. Transactions are similar to a real estate business: a broker knows a mask seller; another broker knows a mask buyer. Both brokers have set up the transaction and each takes a commission, a percentage of the final unit price. And there is plenty of room for profit. One model of the N95 respirator, made by 3M, costs about $1.27 per mask, but FEMA agreed to pay $7 per mask to an inexperienced contractor. We arrived at the clothing district, a strange detour from our stated mission of looking for brokers and shady companies. The contract market has become dizzying for traders trying to decipher which sellers are credible. When brokers can`t deliver, public servants have to make an effort to reissue contracts and find new suppliers while time is running out on the front lines of health care workers.
If a contract has been entered into with a broker who cannot deliver, there is a fundamental failure and the contract can be terminated immediately for breach or for other reasons (as in the above examples from the states of New York and Maryland, where both purchase contracts were terminated later). A lawyer can advise you on the specific reasons and whether or not there is fraud, depending on the jurisdiction. It may also be possible to bring an action for damages. There are legal challenges when you file an international breach of contract lawsuit and then try to enforce a judgment. “I closely followed what was happening in the world and established reliable sources of quality equipment before many manufacturers and brokers appeared who manufacture uncertified and inferior products,” Bedi wrote in an email. “It was only through my hard work and determination that I was able to connect with the government and close these contracts.” “It`s like falling into the drug trade,” said one broker, Rick B., who asked to remember his last name so he could talk freely about his business. Using public documents, I independently confirmed his name and professional associations. Zelonka`s plan was more innovative than the dozens I`d heard from other brokers in recent weeks about winding phone calls, cryptic Twitter messages, and dispatches sent via Signal, an encrypted SMS app. He hoped to sell masks, dresses and gloves for food service workers in places like Jamba Juice, which were reopened when states lifted orders to stay home – a cottage industry within a cottage industry.
While many of these suppliers have managed to match the promised deliveries, court documents and procurement experts suggest that brokers can charge a premium ranging from a minimum of about 2% to the discounts they can make – an extra layer of costs that will ultimately be paid by taxpayers. Trusted regular medical device suppliers were sometimes unable to provide enough PPE. This means that buyers had to check for other brokers and dealers who suddenly appeared on North American radars, claiming to have access to PSA. However, some brokers who claim to have access to PSA actually have no way to deliver, and whether it`s due to overly promising fraud or sometimes even direct, PSA shipments simply never materialize. .