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Selling Nonexistent PPE Is Not a Good Business Plan

  • New York AG Letitia James reached a settlement with medical supply company Borgese Holdings, Inc. d/b/a IMPACT Medical & Surgical Solutions and its owner (collectively, “IMPACT”) to resolve allegations that it fraudulently attempted to sell personal protective equipment (“PPE”) and other medical supplies that it could not deliver in violation of New York Executive Law 63(12), which prohibits repeated fraud in the conduct of business.
  • The complaint alleged that IMPACT fraudulently offered to sell PPE, including 3M-branded N95 respirator masks, to the state of New York and hospitals and healthcare systems nationwide, and obtained substantial upfront payments that it later had to refund because it never had access to the products it promised to deliver.
  • Under the terms of the proposed consent order and judgment, IMPACT may only resume selling PPE and COVID-19 test kits on or after January 1, 2023, and then only upon posting a $100,000 performance bond by IMPACT Medical & Surgical Solutions and another $100,000 bond by its owner. It also is barred from engaging in deceptive or fraudulent marketing and sales practices, among other things.