Trump Signs Defense Production Act to Ban Hoarding Medical Equipment

Melanie Arter | March 24, 2020 | 12:32pm EDT
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(Photo by BRENDAN SMIALOWSKI/AFP via Getty Images)
(Photo by BRENDAN SMIALOWSKI/AFP via Getty Images)

( - The Trump administration is cracking down on the hoarding of medical equipment in the midst of the coronavirus pandemic.

“Earlier today, I signed an executive order invoking presidential authority under Section 4512 of the Defense Production Act to prohibit the hoarding of vital medical equipment and supplies such as hand sanitizers, face masks, and personal protective equipment,” President Donald Trump announced on Monday at a White House press briefing with the White House Coronavirus Task Force.


“So he'll designate certain supplies and medical elements as scarce, and that means it will be a crime to stockpile these items in excessive quantities, which is happening to a relatively small degree, we think, but nevertheless it's happening. We can't let it happen, and we can't let them resell them at excessive prices, which some people are doing,” he said.

The administration is also “aggressively prosecuting fraudulent schemes related to the pandemic.”

“Yesterday, federal prosecutors took action in their first case, shutting down a website selling a totally fake vaccine -- if you can believe that one. As president, I will always fight to protect Americans from being exploited,” Trump said.
Attorney General Bill Barr, who was on hand to explain, said that Trump’s executive order allows the president to deem certain medical supplies as “scarce,” which would prohibit people from “accumulating excessive amounts” beyond “reasonable personal or business needs.” 

The DOJ has formed a task force to deal with the issue.

On March 18th, the president issued Executive Order 13909 invoking the Defense Production Act with respect to the health and medical resources needed to respond to the spread of COVID-19, including PPE and ventilators. 

We have started to see some evidence of potential hoarding and price gouging, and so, earlier today, the president signed a second executive order, providing the authority to address, if it becomes necessary, hoarding that threatens the supply of those necessary health and medical resources. 
Under Section 102 of the Defense Production Act, the president is authorized to prohibit the hoarding of needed resources by designating those materials as ‘scarce,’ or as materials whose supply would be threatened by persons accumulating excessive amounts.  

Once specific materials are so designated, persons are prohibited from accumulating those items in excess of reasonable personal or business needs, or for the purpose of selling them in excess of prevailing market prices.  It is a crime to engage in prohibited activity. 
In today's executive order, the president is delegating to the secretary of HHS this authority to protect against hoarding by designating these critical items. Now, no items have been designated yet, and the Department of Justice is going to be working with HHS to identify cases where a hoarding may be impeding the supply of health and medical resources needed to respond to the COVID-19 pandemic.

Today, we convened our first task force meeting -- a national task force that will be working on the supply chain issues and specifically on the problem of hoarding and price gouging, and we are designating in each of our 93 United States Attorney’s Offices a lead prosecutor who will be responsible in that district for pursuing these cases.

The attorney general said the task force has already launched investigations into hoarding activities. He said the executive order doesn’t apply to people hoarding toilet tissue at home.


I will also want to say that we have not waited for this order to be signed.  As we have received evidence recently, we have already initiated investigations of activities that are disrupting the supply chain and suggestive of hoarding.
I want to stress that we're not talking about consumers or businesses stockpiling supplies for their own operations.  We're talking about people hoarding these goods and materials on an industrial scale for the purpose of manipulating the market and ultimately deriving windfall profits.
If you are -- have a big supply of toilet paper in your house, this is not something you have to worry about.  But if you are sitting on a warehouse with masks -- surgical masks -- you will be hearing a knock on your door.



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