Admin. Financial Violations (PI/PS) Grant Fraud

Published by the National Science Foundation, Office of Inspector General on 2007-06-19.

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

                                                            OFFICE OF INSPECTOR GENERAL
                                                             OFFICE OF INVESTIGATIONS

                                                    CLOSEOUT MEMORANDUM

         An NSF Program Officer (P.o.)' contacted OIG to report that a PI* (ow subject) with four completed awards was
         delinquent on all four final reports. The P. 0. stated that numerous attempts to contact the PI had been
         unsuccess~l,and there were concerns regarding the use of the award funds. The P.O. also stated that the subject
         was known to have serious medical problems, and the P.O. was concerned that the subject's health might have
         further deteriorated.

         Our preliminary review revealed that a univerig had been awarded the four awards on which the subject was the
         PI. We determined that the subject had been employed by the university, but resigned in early 2002 because the
         university had initiated actions to terminate him. The termination action was the result of an internal investigation
         that determined the subject had misused funds from a previous NSF award to the university.

         At the time he resigned from the university, the subject requested that NSF transfer the remaining funds from the
         four active projects to his foundation. Both the university and NSF approved the transfer, and, subsequently, in
         2002, the funds were transferred from the university, to the subject's non-profit f~undation.~ The subject
         maintained contact with NSF from time to time during the remaining time of the awards but failed to submit final
         reports for any of the awards.

         During our investigation we subpoenaed financial records related to the awards, conducted a forensic review of
         the financial records, conducted interviews of university personnel as well as the subject, reviewed university
         records relating to the subject and reviewed medical records submitted by the subject. We also met with the
         Assistant United States ~ t t o r n e (AUSA)
                                               ~'     for the district and presented our preliminary findings that identified
         potential misuse of some of the award funds. This misuse primarily involved using funds meant for one project
         on a separate, unrelated NSF funded project. After discussing the subject's medical status and the minimal
         potential loss to the Government, the AUSA advised that their offlce would not be interested in proceeding with
         any action against the subject.

         It should also be noted that during the course of this investigation the subject did submit the required final reports
         for each of the awards. These reports were subsequently approved and the awards closed by NSF.

          While the results of this investigation are inconclusive, based on the subject's deteriorating medical coddition, the
          lack of any further funding by NSF and the likelihood that even if misused h d s were identified there is no
          recourse to recover these funds; it is our recommendation that this investigation be terminated with no further
          action warranted.

          Accordingly, this case is closed.

NSF OIG Form 2 (1 1/02)