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Grant and Research Fraud

This archive displays posts tagged as relevant to fraud in government grant and research programs. You may also be interested in the following pages:

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May 21, 2019

DeKalb County, Georgia has agreed to pay the federal government $750,000 to settle claims that the county misused Department of Labor On-the-Job Training program grant funds.  OTJ funds are required to be used to reimburse employers that hire individuals with identified skills gaps.  The government alleged that DeKalb county falsely certified that it was complying with OTJ regulations, and used the funds to subsidize the wages of highly qualified county employees, allegedly requiring some to sign paperwork saying that they had received OTJ services when they had not.  USAO ND GA

May 9, 2019

After previously paying restitution of $150,000 to NASA and $50,000 to the National Science Foundation (NSF), the Chicago-based operator of Aries Design Automation LLC was sentenced to three months in prison for defrauding the Small Business Innovation Research Program (SBIRP). To obtain $200,000 in grants and participate in federally-sponsored research, Miroslav Velev submitted false statements, including falsely representations to NASA and the NSF that Aries had secured required third party investments.  USAO NDIL

Duke Pays Big to Settle Whistleblower Charges of Scientific Research Fraud

Posted  03/28/19
Duke University Campus Plaque
On Monday, Duke University agreed to pay $112.5 million to settle charges in violating the False Claims Act by submitting falsified research on federal grants from the National Institutes of Health and Environmental Protection Agency. It is one of the largest settlements by a university for research fraud, and one the government hopes will send a strong message to the academic community. See DOJ Press...

March 25, 2019

Duke University agreed to pay $112.5 million to resolve a whistleblower case under the False Claims Act alleging that between 2006 and 2018, the university submitted claims for millions of dollars in funding under 30 different grants from the National Institutes of Health and Environmental Protection Agency that contained falsified or fabricated data or statements.  According to the U.S., in seeking funding from government entities, Duke misrepresented research conducted on mice in its Airway Physiology Laboratory, as well as the results of that research.  The whistleblower, Joseph Thomas, a former Duke employee, will receive $33.75 million from the settlement.  DOJ

March 21, 2019

The University of Wisconsin-Madison has agreed to pay $1.5 million to settle allegations that it violated the False Claims Act in connection with federal grants used to fund engineering, healthcare, and scientific research. According to the DOJ, the university failed to credit the government for discounts and rebates it received on purchases, as it was required to do under award rules. USAO WDWI

February 20, 2019

New York City will pay $5.3 million to resolve claims that the city sought FEMA recovery funds for certain city-owned vehicles claimed to have been damaged during Superstorm Sandy.  However, the city provided inadequate training to officials regarding the identification of vehicles damaged as a result of the storm, and officials made no effort to inspect the vehicles or determine whether the claimed damage was, in fact, a result of Sandy.  Many of the vehicles for which the city sought full replacement costs had been nonoperational prior to the storm.  USAO SDNY

January 31, 2019

The University of Texas Health Science Center (UTHSC) at Houston paid $2,396,769.76 to resolve allegations that its Human Genetics Center misappropriated grant funds the NIH provided for research related to the impact of genomic variation on individual health and the health of families and populations. The government began its investigation after receiving a tip that the Genetics Center had misappropriated funds to avoid returning unused funds to the NIH. DOJ

January 30, 2019

Laserlith Corporation, Black Hills Nanosystems Corporation, Blue Sky Engineering Inc., along with several corporate representatives, have paid $1.1 million in criminal restitution for making false statements in applications for loans from programs run by NASA, the National Science Foundation, and the Department of Energy.  Between 2012 and 2016, the companies sought funding through the agencies' Small Business Innovation Research Program and Small Business Transfer Technology Research Program, but misrepresented their status as related corporations sharing facilities and performing essentially equivalent work.  DOJ

January 29, 2019

E.M. Photonics, Inc. (“EMP”) and its Chief Executive Officer, Eric Kelmelis, will pay $2.75 million to resolve allegations that they violated the False Claims Act by seeking disbursements from federal agencies for falsified labor costs and duplicative work in order to maximize charges to contracts awarded by federal agencies. From January 2009 to April 2014, EMP received funds under seven different contracts and grants awarded through the federal Small Business Innovation (“SBIR”) and Small Business Technology Transfer (“STTR”) programs. EMP and Kelmelis directed EMP employees, or caused others to direct EMP employees, to complete false timesheets and submit false invoices and public vouchers for direct labor that did not occur. EMP and Kelmelis also sought and received SBIR/STTR funding for work already performed and funded by another government agency and falsely certified that such work was, in fact, non-duplicative. The government alleged that both of these schemes were designed to maximize charges to each contract or grant. DOJ

November 12, 2018

Following a whistleblower complaint, North Carolina-based Shaw University, and local building contractor, Freddy Novelo, have agreed to pay $316,900 to resolve allegations of violating the False Claims Act in bids for Department of Education construction contracts. To evade the department's competitive bidding requirements, the defendants had allegedly submitted false bids, then used the false bids to support their payment claims. USAO EDNC
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