Scottsdale man charged with stealing millions from State of Texas after claiming to be mask distributor


The U.S. Attorney’s Office says the man posed as an authorized distributor for 3M and after the state wired him $16.65 million, he never produced any masks.

SCOTTSDALE, Ariz. — A Scottsdale man has been charged with wire fraud and money laundering after the U.S. Attorney’s Office says he duped the State of Texas into sending him $16.65 million in exchange for nine million 3M masks.

According to the U.S. Attorney’s Office, Dale L. Hipes, 39, of Scottsdale, Arizona represented that he could distribute 3M masks for the State of Texas during the COVID-19 pandemic.

Hipes as CEO of BRI Supply, Inc., claimed to be a authorized 3M mask distributor. 

The state wired $16.65 million to Hipes to purchase the masks, but Hipes never produced any. Instead, the U.S. Attorney’s Office complaint says Hipes returned $12 million to the state and then cut off communications.

The remaining funds were allegedly used for personal use.

Law enforcement seized four bank accounts and a 2020 Kawasaki utility vehicle.  

According to the FBI, the money used by Texas to purchase the masks was fronted by a philanthropist.  

“It’s truly reprehensible that someone would misrepresent themselves and promise to provide Personal Protective Equipment (PPE) during a pandemic then take millions of the fraudulently obtained money and use it for their own personal gain,” Sean Kaul, Special Agent in Charge of the FBI Phoenix Field Office, said in a press release. 

United States Attorney Michael Bailey and Arizona Attorney General Mark Brnovich launched the COVID-19 Fraud Task Force in April 2020, leveraging the resources and expertise of more than twenty different federal and state agencies to combat fraud schemes arising out of the COVID-19 pandemic. 

If convicted of  wire fraud, Hipes could face up to 20 years in prison, a $250,000 fine, or both. A conviction for money laundering carries a maximum penalty of 10 years in prison, a $250,000 fine, or both. 

An Arizona man was arrested in April after allegedly attempting to inflate the price of protective masks in New York by double or triple the original price. The U.S. Attorney’s Office also identified several cases of COVID-19 fraud in May from Valley businesses and healthcare companies.  


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Marya Vinget

Marya Vinget is a freelance writer who works for may content writing agencies and for personal blog owners. She loves to write about everything from Tech to entertainment, You can hire her for the versatile writing attitude.