Top Trump fundraiser sought to cash in on valuable 3M masks
In early April, as U.S. supplies of N95 surgical masks were dwindling, President Trump took aim at 3M, America's biggest mask maker.
Mr. Trump invoked the Defense Production Act, which authorized the head of FEMA to "acquire" any and all 3M N95s. The move set off a week of negotiations leading 3M and the White House to strike a deal to distribute more N95 masks in the U.S.
Four days later, Eric Beach, who had no experience in supplying medical goods, formed Colt International, Inc. touting connections with 3M. Beach is also the co-founder of the Great America PAC, which has raised more than $40 million for Mr. Trump. The PAC has produced attack ads against the president's opponents, including rival Joe Biden.
CBS News obtained a letter sent to prospective customers by one of Colt's "preferred partners." The letter, apparently signed by Beach, assures buyers Colt would "work directly with the 3M Corporation" and its distributors — and provides Beach's direct contact information.
Another document from Colt's partner boasts that Colt's relationship with 3M would provide local governments, hospitals and first responders access to a "current inventory" of "several billion units" of the urgently needed N95 masks.
The partner's letter states that Colt would acquire the 3M masks, and then resell them at marked-up prices.
Government procurement officials and medical suppliers told CBS News that middlemen are driving up the price of highly coveted N95 masks.
"I don't know how somebody can have that many masks," said Sheshank Kamalapuram, who runs an Atlanta-based medical supply company that buys protective equipment for hospitals and nursing homes. Kamalapuram told CBS News that 3M N95s are back-ordered up to three months.
According to a document from Colt's partners, they were offering masks for up to $2.20 each, which is a markup of 93 cents above 3M's list price. The group was also seeking a 10% commission on the final sale.
"You can do the math," Kamalapuram said. "It is a lot of money. It's huge."
"This is what's happening every day," said Kamalapuram, who calls the offer made by Colt and its partners improbable. "You get hundreds of emails from people who claim to have millions of masks with them. I have stayed away from it because it's too dubious."
"This is nothing more than a middleman looking for a commission," said Virginia Finance Secretary Aubrey Layne, who is in charge of buying his state's supply of personal protective equipment. "We would steer clear of solicitations like this."
3M said it has seen a surge of middlemen trying to cash in on the pandemic by falsely claiming affiliation with the company to drum up business. The manufacturer told CBS News it had no professional relationship with Beach's company Colt International.
But Kamalapuram said buyers like hospitals could easily get the impression Colt is affiliated with 3M, adding legitimacy to any potential sale.
In a statement to CBS News, Beach said he "only worked to connect medical buyers through various contacts." Beach also admitted he had no professional relationship with 3M.
