Barr: Prioritize Investigations of Fraudsters Looking to Take Advantage of Coronavirus Pandemic

March 17, 2020 Updated: March 17, 2020

Attorney General William Barr has instructed U.S. attorneys nationwide to prioritize prosecutions and investigations of scammers, fraudsters, and cybercriminals who are seeking to take advantage of the public panic over the coronavirus outbreak.

Barr issued a directive on March 16 urging federal prosecutors to “prioritize the detection, investigation, and prosecution of all criminal conduct related to the current pandemic.”

“The pandemic is dangerous enough without wrongdoers seeking to profit from public panic, and this sort of conduct cannot be tolerated,” Barr said in the memo.

He cited reports of individuals and businesses selling fake cures for COVID-19, the disease caused by the virus, online and also engaging in other forms of fraud such as sending out phishing emails posing as the World Health Organization or the Centers for Disease Control and Prevention. He also said there were also reports of malware being installed onto mobile applications designed to track the spread of the virus.

Barr said the Justice Department’s (DOJ) “critical mission” must continue during the outbreak and that he will ensure that the department’s law enforcement functions will continue to operate effectively during this period.

“It is vital that we work together to safeguard our justice system and thus the safety and security of our nation,” he wrote.

Last week, the DOJ cautioned that individuals and companies who fix prices or rig bids on items such as sterile gloves, protective masks, and other personal protective equipment could face criminal prosecution. It also warned against allocating consumers of public health products among competitors.

“The Department of Justice stands ready to make sure that bad actors do not take advantage of emergency response efforts, healthcare providers, or the American people during this crucial time,” Barr said in a statement at the time. “I am committed to ensuring that the department’s resources are available to combat any wrongdoing and protect the public.”

According to the Federal Trade Commission (FTC), price-fixing is an agreement among competitors to raise, lower, or stabilize prices or competitive terms of any product or service. This conduct is illegal because it restricts competition and often results in higher prices.

The department’s Procurement Collusion Strike Force, which was formed as a national response to combat antitrust crimes, is also on high alert for collusive behavior in the sale of the health products across the country.

State attorneys general across the country are also paying close attention to individuals and businesses who are engaging in unfair business practices such as price gouging and fraudulent conduct during this crisis.

New York, for example, has already taken action against companies that are fraudulently marketing treatments for the virus. New York Attorney General Letitia James sent letters to two companies on March 11 ordering them to immediately stop selling colloidal silver products marketed as a cure for coronavirus. There are currently no Food and Drug Administration (FDA)-approved vaccine to prevent the disease or treatment to cure the illness.

As of Tuesday, there were 97 deaths in the United States from the virus and over 5,800 cases identified in the country, according to data compiled by John Hopkins University. The virus has spread to over 100 countries and territories and infected at least 196,106 people as of March 17.

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