oversight

Grant Fraud

Published by the National Science Foundation, Office of Inspector General on 2004-11-30.

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

 Case Number: 1-03-05-0020                                                                                   Page 1 of 2



          We received an allegation from a complainant who alleged that hisiher university was charging a
          5% "surcharge" to all federal grants. Complainant also alleged that when s h e brought t h s matter to
          the attention of the university, they retaliated against himher and hisiher students by limiting their
          ability to conduct research and that hisiher job with the university was in jeopardy.

          OIG contacted the university's Office of Internal Audits (ON). OIA stated that in 2002 they
          conducted a review of federal awards to determine whether improper charging practices similar
          to those that had occurred at another university were present. OIA's review disclosed that
          approximately $173,000~in technical salary charges on awards open as of November 2002 may
          not have been in strict compliance with A-21 requirements.

          During OIG's meetings with university officials, they stated that technical services were rendered
          but were not charged appropriately.3 The services should have used a recharge rate rather than an
          estimated percentage of technical personnel costs, which ranged from 2 - 7.5%.
             I
             I


          OIG requested the university's OIA to identify all technical salaries that had been improperly
          charged to all open and closed NSF awards for FYs1997 - 2004. OIG also requested OIA to
          include the indirect costs associated with those charges. The review disclosed a total of
          $364,539 of technical salaries, including fringe and indirect costs, that were improperly charged
          to NSF awards, which the university agreed to reimburse to NSF. OIG reviewed the ledgers for
          each NSF award to verify OIA's review. OIG's investigation disclosed no evidence of fraud on
          the part of university officials in this matter.

          At the request of OIG, the university also reviewed all non-NSF federal awards within the College of
          ~Agineerin~  and determined that during the period FYs1997 - 2004, there was $518,993 of
          UAsubstantiated technical salary charges to those awards. The university stated that they will report
          the unsubstantiated charges to the respective federal agencies. In addition, OIG notified the
          respective OIGs for each agency affected.

          Regarding the allegation of retaliation, the university provided OIG with a copy of its faculty
          investigation panel's report which concluded: "We find no violation of faculty rights and privileges
          in the matters referred to us for hearing." OIG's investigation disclosed no evidence of retaliation in



           This amount did not include techmcal salary charges to closed awards and it did not include fringe and indirect
          costs for the technical salary charges to open awards.
           The technical services were not charged in compliance with OMB Circular A-21 J.8.b.(2)(c).



NSF OIG Form 2 (1 1/02)
                                           NATIONAL SCIENCE FOUNDATION
                                            OFFICE OF INSPECTOR GENERAL
                                              OFFICE OF INVESTIGATIONS

                                         CLOSEOUT MEMORANDUM

Case Number:                                                              Page 2 of2



     this matter.

     Accordingly, this case is closed.