Portions of this report are a press release submitted to SOURCE, a digital news media outlet, by the Massachusetts Attorney General’s office.
BOSTON – After investigating a Maryland-based company that falsely marketed and sold a product claiming to be an effective hand sanitizer alternative to prevent the spread of COVID-19, Attorney General Maura Healey has secured a $550,000 agreement resolving claims that it illegally misled the Massachusetts Bay Transportation Authority (MBTA) into ordering thousands of dollars’ worth of the product, which contained no alcohol – a key ingredient in hand sanitizer.
The AG’s Office alleges that in March, the MBTA sought to purchase hand sanitizer as part of its efforts to prevent the spread of COVID-19 at its facilities and contacted Federal Resources Supply Company after receiving a marketing email promoting “Theraworx Protect,” a product manufactured by Avadim Health, Inc., as a “COVID-19 product.”
Tonight, Framingham Public Schools announced “besides the MBTA, this product was also purchased for use throughout Framingham Public Schools last winter. Once the district became aware of this information, we acted immediately to deliver effective alcohol-based hand sanitizer to all school buildings before tomorrow’s school day begins. Framingham Public Schools is committed to maintaining the health and safety of our employees and students and to engaging in risk reducing measures.”
The MBTA was told by Federal Resources that the product sanitizes at a “30-second flash and provides a 6 hour prolonged effect” to fight off the virus, elaborating that “if you touch something it will fight it off.” The AG’s Office alleges that, after relying on these false statements by Federal Resources, the MBTA made three large purchase orders of the product, and now has unused product in storage.
“This company’s reckless and deceptive actions put the health of our frontline workers and the public at even further risk during this unprecedented public health crisis,” AG Healey said. “We took action against this company because their attempt to exploit people during the COVID-19 pandemic for their own profit was not only unacceptable, it was illegal.”
“The MBTA greatly appreciates the work of the Attorney General’s Office, which held this company accountable and recovered the T’s costs,” said MBTA General Manager Steve Poftak. “The safety of our employees is a top priority, and it’s shameful that, during a pandemic, a vendor would make false claims about a product’s effectiveness.”
The assurance of discontinuance, filed and entered in Suffolk Superior Court, resolves allegations that Federal Resources Supply Company violated the Massachusetts False Claims Act and the state’s Consumer Protection Act by promoting, without adequate evidence, that “Theraworx Protect” is effective as a hand sanitizer to combat COVID-19, when the product contains no alcohol.
To prevent the transmission of COVID-19, the Center for Disease Control (CDC) recommends that if soap and water are not available, an alcohol-based hand sanitizer with at least 60 percent alcohol is an effective alternative. The AG’s Office further alleges that Federal Resources Supply Company violated the law by promoting without adequate evidence that its product fights off the virus for six hours after application.
According to the terms of the settlement, Federal Resources Supply Company will pay $400,000 which will go to the state’s general fund and will issue a credit of over $150,000 to the MBTA for the amount of product it used.
The AG’s Office learned of the company’s deceptive actions and intervened before the MBTA paid for its three purchase orders. Federal Resources Supply Company will also retrieve the “Theraworx Protect” that is still located at the MBTA’s storage facility. Federal Resources Supply Company has agreed not to market or sell this product to any Massachusetts agency, and not to include any representation that “Theraworx Protect” is effective against COVID-19 in any marketing materials it distributes in the state, including that it has a multiple hour prolonged effect.
This matter was handled by Assistant Attorney General Mary-Ellen Kennedy of AG Healey’s False Claims Division, with assistance from False Claims Division Chief Amy Crafts.
The False Claims Division was created by AG Healey in 2015 to safeguard public funds and promote integrity and accountability in public contracting. AG Healey urges anyone with information about suspected fraud or abuse relating to state or municipal contracts or funds to contact the False Claims Division’s tip line at 617-963-2600.