Grant Fraud

Published by the National Science Foundation, Office of Inspector General on 2004-07-01.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                                         NATIONAL SCIENCE FOUNDATION
  @ .                                                     OFFICE OF INSPECTOR GENERAL
                                                            OFFICE OF INVESTIGATIONS
                                                  CLOSEOUT MEMORANDUM
       ON o

 Case Number: A03120076                                                                                    Page 1 of 1

                  This case was opened to investigate several issues that arose regarding an award' as part
          of a proactive review of conference/workshop awards for compliance with program income rules.
          Although no program income appears to have been earned, a review of the awardee's supporting
          documentation raised issues regarding cost-sharing, reallocation of participant support, and a
          potential conflict of interests (COI) allegation involving the approving NSF program dire~tor.~
                  The awardee supplied documentation, including general ledger entries and receipts,
          supporting its satisfaction of its cost-sharing obligation. Those documents also showed: participant
          support h d s had been inappropriately used to provide hotel accommodations for awardee's
          employees and non-participating spouses; a duplicative airfare charge for a participant; and the
          apparent reallocation of funds for non-participant support purposes.3 NSF awarded funds were
          classified entirely under the participant support category.
                  Additional information from the awardee revealed that its travel agent had reimbursed the
          awardee for the duplicate airfare, but the awardee had not passed the refund to the grant account.
          The awardee also provided email correspondence in an effort to show that it had NSF approval for
          the reallocation of funds; however, it became evident that the awardee had not followed through with
          the process and did not request the reallocation properly. Thus, the awardee did not have the
          requisite prior written approval from the program officer.
                  The awardee reimbursed the NSF grant account4for the hotel charges for its employees and
          the participant's spouse as well as the duplicative airfare charge. After consultation with the
          program ~ f f i c e r we
                                , ~ decided not to pursue further the awardee's failed request to reallocate
          participant support costs as an investigative issue. Instead that issue has been included in a referral
          to audit outlining several potential failures in the awardee's internal controls for managing
          participant support funds.
                  The potential COI involves the program director who approved the award and who also
          received participant support6to attend the workshop. At the time the award was made, she was a
          former employee of the awardee institution. This program director left NSF soon after approving the
          award and was not an NSF employee at the time she attended the workshop. Because the program
          director is no longer an NSF employee, we are unable to pursue this administratively.

                    Accordingly, this case is closed.

                           -      p~

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                            the cognizant NSF program officer for the award at the time the h d s were reallocated

NSF OIG Form 2 (1 1/02)