Air Force veteran in hot water for price gouging hand sanitizer during crisis

hand sanitizer
Photo credit (Photo by Samuel Corum/Getty Images)
By Connecting Vets

An Air Force veteran got scolded by the internet this weekend for hoarding hand sanitizer and other sought after products during the coronavirus pandemic that has swept the world and resulted in President Trump declaring a state of national emergency.

Former Tech. Sgt. Matt Colvin makes his living by reselling goods online. This practice is often referred to as retail arbitrage.

"While the idea to buy something cheap and sell it at a higher price is age-old, the concept of retail arbitrage has emerged in the digital age," The Washington Post described.

Sellers buy up product in bulk or on sale, and then resell it on websites like Amazon and eBay at a higher price for profit.

With the spread of the COVID-19 virus, Colvin saw an opportunity and jumped on it early. He traveled around his home in Tennessee buying up hand sanitizer and Lysol wipes. Then both Amazon and eBay changed their policy about reselling these goods as they looked to prevent price gouging customers during a time of crisis.

While retail arbitrage is perfectly legal, because of the high demand of these items during a national emergency, Colvin may have broken laws regarding illegal price gouging. Here is how the state of Tennessee defines it: "Tennessee’s unfair or deceptive acts or practices law makes it illegal to "unreasonably [raise] prices or unreasonably [restrict] supplies of essential goods, commodities or services in direct response to...a natural disaster", even if the event occurs out-of-state. Penalties for violations of the act are up to $1,000 per violation, and the Attorney General may also seek injunctions, consumer restitution, or other appropriate remedies."

With that in mind, the state's attorney general has launched an investigation. “We will not tolerate price gouging in this time of exceptional need, and we will take aggressive action to stop it,” Attorney General Herbert H. Slatery III said in a press release. “During this pandemic, we ask that you report suspicious activity to the Division of Consumer Affairs and refrain from threatening or hostile communication with individuals or businesses you may suspect are price gouging. Our team will review complaints closely and we are prepared to act to protect Tennesseans.”

Colvin gave an interview to the New York Times after Amazon and eBay shut down his entrepreneurial endeavors, the article titled, "He has 17,700 bottles of hand sanitizer and nowhere to sell them." Granting the interview is likely a decision the Air Force veteran regrets now.

Reader comments stated, "as someone who lives in the communities this guy stripped... it has been absolute madness trying to find hand sanitizer, masks, or even bleach" and another individual wrote, "meanwhile, a mom in my area can't get hand sanitizer, masks, wipes, etc. to care for her preschooler who has had a heart transplant and is on immunosuppressive medication." However, others were more sympathetic, feeling the stores themselves had a responsibility to cap how much product each customer should be allowed to buy, rather than letting someone like Colvin walk out the door with their entire inventory.

"I am a generally a free-market capitalist," a reader named Adam wrote, "but government’s role in a free market is to adjust incentives. Such pernicious exploitation should be punished." 

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Reach Jack Murphy: jack@connectingvets.com or @JackMurphyRGR.