Businessmen plead guilty to hoarding, price-gouging personal protective equipment

September 9, 2021 Brooklyn Eagle Staff

The U.S. District Court for the Eastern District of New York, more informally known as Brooklyn Federal Court, in Downtown Brooklyn. Photo: Rob Abruzzese/Brooklyn Eagle

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On Wednesday at the federal courthouse in Central Islip, Allen Goldmeir and his brother Steven Goldmeir, owners of a toy company called Millennium Products Group, pleaded guilty to hoarding personal protective equipment amid the COVID-19 pandemic and price-gouging customers that purchased three-ply surgical masks from them in violation of the Defense Production Act of 1950. The proceeding took place before United States Magistrate Judge James M. Wicks.

On March 18, 2020, in response to the COVID-19 pandemic, the Defense Production Act was invoked making it illegal to acquire medical supplies and devices designated by the Secretary of Health and Human Services as scarce in order to hoard them or sell them for excessive prices.

According to statements in court Wednesday, in March and April 2020, the defendants used their toy company, MPG, to obtain millions of three-ply surgical masks from China for between approximately $0.18 and $0.60 per mask. Almost immediately thereafter, the defendants sold 1,227,500 of these masks to the State of Oklahoma, among others, at a price of $1.65 per mask – a markup of over 900 percent in many cases.

Pursuant to their agreement with the government, the defendants will pay $1 million in restitution to the State of Oklahoma prior to sentencing in this matter. In addition, the defendants face up to one year in jail and a maximum fine of $10,000.

Jacquelyn M. Kasulis, acting United States attorney for the Eastern District of New York, and Michael J. Driscoll, assistant director-in-charge, FBI, New York Field Office (FBI), announced the guilty pleas.

“The defendants selfishly sought to make millions of dollars in profits during an unprecedented public health crisis by hoarding and selling at exorbitant prices personal protective equipment that was desperately needed by the State of Oklahoma to protect the public health and safety, and save lives,” said Acting United States Attorney Kasulis. “This office will continue to do everything in its power to enforce the Defense Production Act and ensure that opportunists like the defendants are held accountable for their indiscriminate acts of greed.”

“During the height of the pandemic, cases in which people sought to capitalize on the situation at the expense of others were, unfortunately, an all-too-common occurrence. More than a year later, the

Acting U.S. Attorney for the Eastern District of N.Y. Jacquelyn M. Kasulis. Photo courtesy of U.S. Attorney’s Office,

continues to work to identify and hold accountable any company, individual, or entity whose intention it was to do so. The Goldmeirer brothers pleaded guilty today for their role in a price-gouging scheme, and they’ll now await sentencing for their crimes,” said FBI Assistant Director-in-Charge Driscoll.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud.

The government’s case is being handled by the office’s Long Island Criminal Division, with assistance from the Justice Department’s Covid-19 Hoarding and Price-Gouging Task Force. Assistant United States Attorney Megan E. Farrell is in charge of the prosecution.