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Oxygen Shortage in Mexico Spurs Profiteering

COVID AND CRIME / 8 FEB 2021 BY KATYA BLESZYNSKA EN

With oxygen in short supply in Mexico amid the COVID-19 pandemic, a black market is expanding -- in another example of medical shortages spurring fraud and profiteering.

On February 1, Ricardo Sheffield, the head of Mexico’s national consumer protection agency, PROFECO, said that more than 130 online ads and 1,200 Facebook profiles were fraudulently selling oxygen cylinders, Excelsior reported.

“Ignore the offers you see on social media, because they feed a black market, they are stolen cylinders for industrial purposes, you can’t use them to breathe,” he warned at an earlier press conference.

SEE ALSO: Theft of Critical Medical Equipment Surges in Latin America

A release by Mexico City’s Secretariat of Public Security (Secretaría de Seguridad Ciudadana – SSC) also flagged fake sites of medical gas companies that offered oxygen cylinders for purchase, rental or refill. Once people handed over deposits and their personal information, the sites vanished.

Almost 90 percent of hospitals in Mexico are now at full capacity. Many families have had to treat sick relatives at home. The severe shortage in oxygen has left them vulnerable to price gouging and fraud, officials said.

The crisis is also leading to cases of violent crime. On January 19, two armed men were caught hijacking a truck delivering 55 empty oxygen canisters to a plant near the central municipality of Ecatepec. That same day, a gunman entered a hospital in the north-western state of Sonora, fleeing with seven tanks.

InSight Crime Analysis

The black market in oxygen has been exposed in several Latin American countries, and scams surrounding medical supplies continue to thrive amid the COVID-19 crisis.

In Brazil, the city of Manaus has been hit hard by the pandemic. By October of last year, 76 percent of the city's two million residents had been infected, researchers estimated.  

In Manaus, doctors from overwhelmed hospitals have been handing empty canisters to family members of patients with COVID-19, instructing them to find any way possible to refill them.

SEE ALSO: GameChangers 2020: 3 Ways Criminal Groups Overcame Coronavirus

Brazilian news portal UOL reported that the lack of oxygen cylinders in Manaus created a “parallel market,” with some people spending up to 5,000 reais ($920) per cylinder -- a fivefold increase.

In Peru, the oxygen demand is also outweighing supplies, encouraging illegal sales. Medical gas company Praxair said in a news release that “unscrupulous people have been offering for sale to the public, oxygen and cylinders, usurping the name and corporate identity of the company." Some families have sold personal belongings to pay the 4,500 soles (around $1,230) required for each canister.

Peruvian businessman José Luis Barsallo, of the coastal Callao region, was nicknamed the “Oxygen Angel” for his commitment to supply the tanks at fair prices, stating in an interview back in June that “he didn’t know how people that raised their prices could sleep at night.”

Barsallo, however, received threats from illegal sellers, forcing him to stop providing tanks, according to a preliminary investigation.

All three countries are trying to find ways to resolve the oxygen shortage. The Mexican government has increased canister imports from the United States. It has also reached an agreement with the country’s industrial gas plants to ensure 70 percent of production gets converted into medical use.

In Peru, the government is setting up 20 new gas canister plants across the country to fulfill demand. Brazil has even accepted 132,000 liters of oxygen from Venezuela, despite the two countries' frosty relationship.

The oxygen canisters are another item in a long list of healthcare supplies --from face masks and hand gel to vaccines and personal protection equipment -- to have made their way to the black market or been used in fraud schemes.

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