NJ company admits to price gouging of KN95 masks, officials say
A company that had no history selling personal protective equipment prior to the coronavirus pandemic has admitted its role in price gouging a chain of New Jersey grocery stores with the sale of KN95 masks in 2020.
Acting U.S. Attorney Rachael Honig announced Wednesday that TSC Agency LLC, a logistics and freight forwarding company based in Mahwah, Bergen County, pleaded guilty by teleconference to the activity that violated the Defense Production Act.
According to documents filed in the case, TSC and partners purchased 250,000 KN95 masks from a foreign manufacturer in March 2020. TSC and one of the partners, according to the documents, then sold 100,000 masks to a grocery store chain — which was not named — at a price of $5.25 per mask, a markup of more than 400% from the acquisition cost.
According to the documents, the significant price hike was not due to excess costs related to acquiring and transporting the masks — just a way to make a bigger profit.
Announcement of the financial penalty for TSC is scheduled for April 13.
According to the documents, the grocery store that purchased the masks at the higher price either provided them to employees free of charge, or charged customers less than what it had paid per mask.
Contact reporter Dino Flammia at firstname.lastname@example.org.