A Georgia man will spend nearly six months in home confinement after he admitted to trying to sell more than $300 million worth of N95 face masks that didn't exist to a foreign government, according to federal prosecutors.
The sentence was handed down after Paul Penn, 64, of Johns Creek, Georgia, pleaded guilty to conspiracy to commit wire fraud, Bobby L. Christine, the U.S. Attorney for the Southern District of Georgia, said Tuesday in a statement. A judge also fined Penn $1,500 and ordered him to serve three years probation.
“This case should serve as a strong deterrent to those considering exploiting the Covid-19 pandemic to enrich themselves through fraud," Glen M. Kessler, the Resident Agent in Charge of the Secret Service Savannah Office, said.
Penn, through his company, Spectrum Global Holdings LLC, worked with unnamed co-conspirators to act as a middleman in the sale of 50 million 3M Model 1860 respirator masks to a foreign government, according to the statement from Christine's office.
Penn did not even have the masks to sell, but he was to act as the broker for the $317 million sales price in exchange for a cut, according to court documents. The price he quoted was 500 percent higher than the normal market value for N95 masks.
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The foreign government wired the money to complete the purchase. All funds were returned after the U.S. Secret Service disrupted the transaction.
“If not for the vigilance of the U.S. Secret Service, Paul Penn and his co-conspirators likely would have lit the fuse on an international scandal by ripping off a friendly foreign government for more than $300 million,” Christine said. “Instead, they halted the scheme before the criminals got a dime, and prevented these crooks from profiting from pandemic fear.”
Efforts to reached Penn by phone at numbers listed for his home and business Thursday were unsuccessful.