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MARKETANALYST.US / NEWS

Firm That Sold Fake N95 Masks During Pandemic Ordered to Pay $1.1 Million Refund to Customers

The FTC demands refunds from Razer for falsely advertising Zephyr masks as N95-grade protection.
PUBLISHED MAY 1, 2024
Cover Image Source: Pexels | Photo by CDC
Cover Image Source: Pexels | Photo by CDC

Covid was a tough time for America and the world, with a surge in demand for essentials such as PPE kits and face masks, but while firms rushed to fulfill requirements, scammers also jumped in to exploit the desperate situation. Now the Federal Trade Commission (FTC) has mandated that a company implicated in the fraudulent sale of purported N95-grade face masks must reimburse over $1.1 million to customers nationwide. The announcement came on Monday, underscoring the agency's commitment to consumer protection amidst ongoing health concerns. Razer and its associated entities were accused of promoting the Zephyr mask as N95-grade without undergoing requisite testing or certification from the Food and Drug Administration (FDA) or the National Institute for Occupational Safety and Health (NIOSH).

Unsplash | Photo by Kobby Mendez
Unsplash | Photo by Kobby Mendez

The deception

According to the FTC's complaint, advertising campaigns and social media posts claimed that the Zephyr masks provided N95-level protection against COVID-19. "This deceitful marketing preyed on public fears during a global health crisis, falsely positioning their product as an N95 respirator," remarked Samuel Levine, Director of the FTC's Bureau of Consumer Protection. Beginning in October 2021, the Zephyr mask was offered for sale at $99.99, including three sets of filters. Razer also marketed the Razer Zephyr Starter Pack, comprising a mask and 33 sets of filters, for $149.99, and a Razer Zephyr Filter Pack with 10 sets of filters priced at $29.99.

In response to the FTC's findings, Razer and its affiliated businesses are prohibited from making misleading COVID-related claims or unsubstantiated assertions about protective gear. Alongside full refunds to customers who were misled by their advertising, the companies are required to pay a civil penalty of $100,000.

Unsplash | Photo by Vera Davidova
Unsplash | Photo by Vera Davidova

In a related incident, University City Dermatologist Dr. Mona Zohdi Mofid and her son, Adam Zohdi Mofid, have been sentenced in federal court for their roles in hoarding and reselling N95 respirator masks during the COVID-19 pandemic. Dr. Mona Zohdi Mofid pled guilty in April to misdemeanor hoarding of N95 respirator masks, which were designated as scarce during the pandemic. She was sentenced to two years' probation and fined $100,000. Mofid was also sentenced to two years probation with 60 days of home confinement, and fined $1.2 million in addition to 200 hours of community service.

The surge in demand for N95 masks due to the pandemic led to a shortage in supply. On March 25, 2020, N95 masks and other personal protective equipment were declared scarce under the Defense Production Act, triggering anti-hoarding and anti-price-gouging provisions. According to Dr. Mona Mofid's plea agreement, she knowingly purchased over 375,000 N95 masks from medical supply companies between May 2020 and January 2021, despite the illegality of such actions. Adam Mofid admitted that his company, Clinical Supplies USA, generated significant income through the sale of N95 masks at inflated prices, well above market rates, during the same period.

U.S. Attorney Randy S. Grossman condemned the actions of the defendants, stating, "While many in our community, especially healthcare providers, responded valiantly to COVID-19, some people took advantage of the pandemic. These defendants are paying the price for selling medical supplies at inflated prices during a national crisis."

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