Jan. 18, 2021 – Last week, SAN FRANCISCO – The U.S. Attorney’s Office for the Northern District of California filed charges against Defendant Rodney L. Stevenson II with wire fraud, postal fraud and money laundering for his operation of an e-commerce website that claimed to have put N95 masks on sale during the current COVID-19 epidemic, U.S. attorney David L. Anderson, U.S. Postal Inspector in, known charges against Rafael E. Nuñez and the Federal Bureau of Investigation Special Agent Craig Fair. Stevenson was previously arrested and charged with criminal charges.
According to the indictment, Stevenson operated EM General, a Michigan limited company incorporated in September 2019, which allegedly sold N95 masks with N99 filters. At the start of the COVID-19 pandemic in February 2020, EM General and its Stevenson-controlled website announced that N95 masks were “in stock” and ready to ship. EM General sold many of these masks for $ 24.95 each. According to the indictment, in order to bolster the legitimacy of EM General, Stevenson created a professional-looking website with the names, background stories and stock photos of a group of fake EM General executives. It also incorrectly described how long the company had been in business, how much sales it had, and how good it looked. Stevenson also used fictional names in emails to customers.
The indictment alleges that EM General sales skyrocketed as the pandemic worsened and demand for N95 masks soared. Total sales for EM General from about on or about February 11, 2020 to about on or about March 8, 2020 were approximately $ 3,500,000, involving over 25,000 customers. The vast majority of this was selling N95 masks, which were never shipped to customers. That amount included sales of over $ 900,000 on February 28, 2020 alone.
According to the prosecution, Stevenson and EM General provided almost none of the masks. When customers complained and asked for a refund, Stevenson, who intermittently communicated with Gmail accounts he created under the names of fake identities, generally refused to refund customers and instead offered a series of lies to defraud his program while continuing to sell masks. Those lies included that EM General could not offer a refund because it had already paid for the customer’s order from a manufacturer, that products would be shipping soon, and that customers would soon be receiving follow-up orders. For a small number of customers, Stevenson eventually fraudulently replaced masks that did not meet the standards set by the National Institutes for Safety and Health at Work for N95 or N99 masks, which meant they didn’t get 95 or 99 percent of the particles out of the filtered out air.
Stevenson is charged with nine wire fraud cases in violation of 21 USC § 1343; a postal fraud count that violates 18 USC § 1341; five cases of money laundering in violation of 18 USC § 1956 (a) (1) (A) (i); and a count of money laundering in violation of 18 USC § 1957.
An indictment merely alleges that crimes have been committed and the accused is deemed innocent until found guilty beyond any doubt. If convicted, the defendant faces a maximum sentence of 20 years in prison, 5 years probation and a fine of $ 250,000 for any number of wire or postal frauds, and a maximum of 10 years in prison and 3 years probation. and a fine of $ 250,000 for any count of monetary instruments or money laundering. However, any post-conviction penalty would be imposed by the court in accordance with U.S. Sentencing Guidelines and the Federal Act on the Imposition of a Penalty, 18 USC Section 3553.
Stevenson was charged on April 22, 2020 on wire fraud charges. An indictment against the indictment is currently scheduled for January 15, 2021 before US Judge Alex Tse.
The case is being prosecuted by the US Attorney’s Special Prosecutions Section for the Northern District of California.