NATIONAL SCIENCE FOUNDATION
OFFICE OF INSPECTOR GENERAL
OFFICE OF INVESTIGATIONS
CLOSEOUT MEMORANDUM
11 TO: AIGI 1 File Number: I92100027 1 Date: 16 May 2002
Il Subject: Closeout Memo Page 1 of 1
There was no closeout written at the time this case was closed. The following information was
extracted from the file in conformance with standard closeout documents.
Our office was informed that the subject' was alleged to have extensively misused grant funds by
NSTA. Joint Audit and Investigations recovered $200,000. The subject pled guilty to 18 USC 666,
paid restitution of $20,000.00, fined $10,000.00. The subject was also sentenced to one thousand
hours of community service and four months of home confinement. The subject was debarred for
three years.
The attached documents constitute the closeout for this case.
I
Russell Aiuto
Prepared by: Cleared by:
Agent: Attorney: Supervisor: AIGI
Name:
Signature &
date:
@NATK)NAL SCIENCE FOUNDATION @
016 C / I - ) V i r ,
4201 WILSON BOULEVARD
ARLINGTON, VIRGINIA 22230
August 2 9 , 1995
OmCEOFTHE
DEPUTY DIRECTOR
CERTIFIED MAIL-RETURN RECEIPT REOUESTED
Dr. Russell Aiuto
Re : Debarment
Dear Dr. Aiuto:
On July 7, 1995, the National Science Foundation (NSF) sent you a
Notice of Suspension and Proposed Debarment in which NSF proposed
to debar you from directly or -indirectly obtaining the benefits
of Federal research grants for a period of three years. A copy
of the Notice is enclosed. The Notice sets forth in detail the
circumstances giving rise to your debarment. Your debarment is
based on your criminal conviction of theft from Federal grant
monies awarded to the National Science Teacher's Association.
The conviction establishes by a preponderance of evidence cause
for debarment pursuant to 45 CFR 55620.314(c) and 620.305.
In the July 7, 1995 Notice of Proposed Debarment, NSF informed
you that you had a period of 30 days in which to respond to the
proposed debarment. If no response was received during that time
period, the debarment would become final. You did not respond to
the proposed debarment.
Accordingly, this serves as notice pursuant to 45 CFR 5620.314
that you are debarred until July 7, 1998. The debarment shall be
effective throughout the Executive Branch of the Federal
Government. You will be excluded from receiving Federal'
financial and non-financial assistance and benefits under
nonprocurement programs and activities unless an agency head or
an authorized designee makes a determination to grant an
exception in accordance with 45 CFR 8620.215.
If you have any questions regarding the foregoing, please feel
free to contact me.
Sincerely,
~nn'e C. Petersen
Deputy Director
Enclosure
ARLINGTON, VIRGINIA 22230
July 7, 1995
OFFlCE OF ME
GENERAL COWSEL
CERTIFIED MAIL-RETURN RECEIPT REOUESTED
Dr. Russell Auito
.
Re: Notice of Suspension and Proposed Debarment
Dear Dr. Auito:
This letter serves as formal notice that the National ,Science
Foundation (NSF) has suspended you and is proposing to debar you
from directly or indirectly obtaining the benefits of Federal
grants for a period of three years from the date of this letter.
A person who is debarred will be excluded during the period of
debarment from Federal financial and non-financial assistance and
benefits under nonprocurement Federal programs and activities. See
45 CFR Sections 620.110 and 620.200. Debarment of an individual is
effective throughout the executive branch of the Federal
Government. The effect of suspension is the same as debarment,
except that it is for a temporary period of time pending completion
of debarment proceedings.
Reasons for Suswension and Debarmenk .
Your suspension and debarment are based upon a referral from our
Off ice of Inspector General (OIG) .
The Foundation's record
demonstrates that you have committed irregularities seriously
reflecting on the propriety of further Federal Government dealings
with you, and that there is a cause for your suspension and
debarment. The Foundation's current administrative record
indicates that you were the Director of Research and Development
with the National Science Teacher's Association (nNSTAm), an
organization that received Federal funding from the Department of
Education and NSF. The investigation of this matter further
disclosed that you were criminally convicted of theft from Federal
gkant monies awarded to NSTA.
Specifically:
1. On May 26, 1995, an Information was filed in the United States
District Court for the District of Columbia in the matter of U.S.
v . Russell Aiuto. A copy of the information is enclosed and the
allegations are hereby incorporated by reference. The information
charged you with one count of misapplying $19,598.67 of Federal
funds awarded to NSTA by the Department of Education and the NSF
Telephone (703)306-1060 FAX (703)3064149
I Dr. Russell Aiuto
Page Two
between January, 1991 and May, 1993, in violation of
18 USC 5666 (Theft Concerning Programs Receiving Federal Funds).
2. On June 7 , 1995, you pled guilty to the Information filed in
U.S. District Court for the District of Columbia. A copy of the
Plea Agreement is attached and hereby incorporated by reference.
Requlatorv Basis for Debarment and Suswensioq
45 CFR Section 620.305 provides that debarment may be imposed for:
(a) Conviction of or civil judgment for:
(1) Commission of fraud or a criminal offense in
connection with obtaining, attempting to obtain, or performing a
public or private agreement or transaction;
(3) Commission of embezzlement, theft, forgery, bribery,
falsification or destruction of records, making false statements,
receiving stolen property, making false claims, or obstruction of
justice; or
( 4 ) Commission of any other offense indicating a lack of
business integrity or business honesty that seriously and directly
affects the present responsibility of a person.
Your conviction for theft from a program receiving Federal funds
supports a cause for debarment under 45 CFR Sections 620.305(a)(1),
(21, and (3). Your conviction reflects adversely on your
integrity, honesty, and present responsibility in relation to
Federal financial and non-financial assistance and benefits. The
filing of the Information and your subsequent conviction also
establish adequate evidence for your suspension. 45 CFR Sections
620.400 and 620.405.
Debarment must be for a period commensurate with the seriousness of
the cause. 45 CFR Section 620.320(a). It should generally not
exceed three years, but where circumstances warrant, a longer
period may be imposed. 45 CFR Section 620.320. If a suspension
precedes the debarment, the suspension shall be considered in
determining the debarment period. 45 CFR Section 620.320. The
burden of proof is on the government to establish facts which
justify debarment by a preponderance of the evidence. 45 CFR
Section 620.314(c). Where the proposed debarment is based upon a
conviction, the standard shall be deemed to have been met. 4 5 CFR
Section 620.314 (c).
You pled guilty to intentionally misapplying and knowingly
embezzling from NSTA $19,598.67 in funds which derived from Federal
grant monies from NSF and the Department of Education.
Because. of the seriousness of this offense, we are proposing
debarment for a period of three years.
Procedures Governinq Proposed Debarment
The provisions of 4 5 CFR Section* 620.300 through 620.420 govern
debarment and suspension procedures and decisionmaking. Under,our
regulations, you have 30 days after receipt of this notice to
submit, in person, or in writing, or through a representative,
information and argument in opposition to your suspension and
debarment. 45 CFR Sections 620.313 (a); 620.412 (a). Comments
submitted within the 30-day period will receive full consideration
and may lead to a revision of the recommended disposition. If we
do not receive a response to this notice within the 30-day period,
this debarment will become final.
Any response should be addressed to me at the National Science
Foundation, Office of General Counsel, 4201 Wilson Boulevard, Room
1265, Arlington, Virginia, 22230. For your information, we are
attaching a copy of the Foundation's regulations on Non-procurement
Debarment and Suspension.
Sincerely,
Lawrence Rudolph
General Counsel
Attachments ( 3 )
Information
Plea Agreement
Debarment and Suspension Regulations
NATIONAL SCIENCE FOUNDATION
4201 WILSON BOULEVARD
ARLINGTON, VIRGINIA 22230
14 June 1995
OFFICE OF
INSPECTOR GENERAL
TO: Neal F. Lane
Director,--.
FROM:
Inspector General
SUBTECT: Proposed Suspension and Debarment of Dr. Russell Aiuto
I am referring this matter to you because under NSF's nonprocurement debarment
regulation, NSF's suspending and debarring official is either you or an official whom you
designate.' Thus, you may resolve this matter yourself, delegate it to the Deputy ~ i r e c t o r , ~
or designate another senior NSF official to handle it.
On June 7, 1995, Dr. Russell Aiuto, the former Director of Research and Development
with the National Science Teacher's Association (NSTA) in Arlington, Virginia, entered a plea
of guilty to one count of theft from a program receiving federal funding, a felony violation of
18 U.S.C. $ 666. In an Information filed by the U.S. Attorney of the District of Columbia,
Dr. Aiuto had been charged with one count of misapplying, embezzling, and fraudulently
obtaining federal funds awarded by the National Science Foundation and the U.S. Department
of Education (DoEd) to NSTA. United States District Judge Ernmet Sullivan accepted
Dr. Aiuto's guilty plea. Copies of the Information, the plea agreement, and the Department of
Justice press release are attached.
Prior to his tenure at NSTA, Dr. Aiuto was Director of NSF's Division of Teacher
Preparation and Enhancement Program in the Directorate for Education and Human Resources.
At NSTA, he was responsible for public relations and dissemination of materials related to a
grant called the Scope, Sequence and Coordination (SS&C) Project, a program intended to revise
the manner in which science is taught in secondary schools. His salary as Director of Research
and Development at NSTA was paid by NSF and DoEd SS&C grants. Our audit and
investigation into his misuse of federal funds at NSTA disclosed that $19,598 in NSF and DoEd
grant hnds were fraudulently diverted by Dr. Aiuto into his personal financial account.
Dr. Aiuto is scheduled to be sentenced on September 19, 1995, before Judge Emmet Sullivan.
'45 C.F.R. 620.105(g), (t).
2 ~ ~misconduct
~ ' s regulation designates the Deputy Director (or her designee) to be the debarring official for
misconduct cases in which OIG recommends debarment. 45 C.F.R. $ 689.8(c)(l)(i). This is not a misconduct
case.
He faces a maximum sentence of 10 years imprisonment and a fme of $250,000.
Based on the criminal Information and guilty plea by Dr. Aiuto, we recommend that you,
in your capacity as NSF's suspension and debarment official, initiate suspension and debarment
proceedings to prohibit Dr. Aiuto from receiving federal assistance (through grants or
cooperative agreements) from any source, for a period of three years. Debarment will prevent
Dr. Aiuto from receiving additional grants, and will also restrict his ability to work under
another PI'S award. We also recommend immediate suspension proceedings, because prompt
action is necessary to ensure that Dr. Aiuto does not receive funding as co-PI on a proposal he
recently submitted to NSF.~
In addition, we recommend that you take action to ensure that Dr. Aiuto stops receiving
NSF funding,4 which is not affected by suspension and debarment; and alert the National
Endowment for the Humanities (NEH) and DoEd, both of which currently provide funding to
Dr. Aiuto,' so that appropriate action is taken by all components of the federal government.
Agency officials at NSF, NEH,and DoEd should determine whether it is more appropriate to
(1) terminate all g m t s involving Dr. Aiuto, or (2) replace Dr. Aiuto on current awards while
allowing the grantee institution to continue to receive federal funding.
Please letus know what actions you will take in this matter.
Enclosures: 1. Department of Justice Press Release
2. Information fded by U.S. Attorney
3. Plea agreement
cc: Anne C. Petersen, Deputy Director (w/enclosures)
Lawrence Rudolph, General Counsel (w/enclosures)
Luther S. Williams, Assistant Director (w/enclosures)
%ED 95-54285, Edward J. Barboni (PI), Russell Aiuto (co-PI), and Russell Garth (co-PI), Planning Grant
for the Ejfective Incorporation of the Internet in Teacher Preparation and Professional Development.
4~ccordingto information currently available to us, Dr. Aiuto receives NSF funding via Lnteragency Agreement
DUE-9353328, to the National Endowment for the Humanities (NEH). DUE-9353328 provides funds to support
NEH award EW-20214-94, Russell Aiuto (PD), Integrating the Sciences and the Humanities in a Program of
Environmental Studies.
'~ationalEndowment for the Humanities, EW-20214-94, Russell Aiuto (PD), Integrating the Sciences and the
Humanities in a Program of Environmental Studies (see note 4); U.S. Dept. of Education, P-27 1A40018, Developing
Faculty Professionalism and Academic Leadershipfor Faculty Members at Historically Black Independent Colleges
(1994).
-. a , . .
-36-07-1995 17:55
U.S.
United States Attorney
District of Columbia
contact: Revin A. Ohlson FOR IHMEDIATE RELEASE
'r
(202) 514-6933 June 7, 1995
PRESS RELEASE
ERIC H. HOLDER, JR.
UNITED STATES ATTORNEY
FOR THE DISTRICT OF COLUHBIA
United States Attorney Eric H. Holder, Jr. , announced that Dr.
Ruesell Aiuto, 60, of Frederiok, Maryland, the former Director of
Research and Development with the National Science Teachsrte
Association ("NSTAw) in Arlington, Virginia, entered a plea of
guilty today in United States District Court to one count of theft
from a program receiving federal funding. Dr. Aiuto admitted that
he had embezzled from NSTA approximately $19,598.00 in funds, which
had originated from federal grant monies awarded to NSTA by the
National Science Foundation (NSF) and the Department of Education.
According to the statement of facts presented in court today,
Dr. A i u t o was responsible for public relations and dissemination of
materiala related to a grant project called the "Scope, Sequence,
and Coordination P r o j e ~ t ,a ~program
~ intended to revise the manner
in whioh eaience is taught in secondary echoole. Prior to his
employment with NSTA, Dr. Aiuto had eerved as the Director of the
Division of Teacher Preparation and Enhancement at NSF, and had
been involvad with the formation of this grant program. As a
reprsaantative of NSTA, Dr. A i u t o traveled throughout the country,
making presentations about science education reform to etate and
local school districts and professional educational organizations.
Dr. Aiuto's travel for this purpose was paid for by NSTA from the
grant funds.
An audit by the Office of Inspector General of NSF of the
grant program revealed that on many occa~ions,Dr. Aiuto had sought
reimbursement for his official travel expenses directly from the
institution6 and organizations to which he had lectured, d e e p i t e
the fact that NSTA had already financed his official travel. When
Dr. ~ i u t owas successful in obtaining such reimbureements, he
deposited the checks that he received directly into his personal
bank account without remitting the fundg to NSTA or even notifying
NSTA that he had received a reimbursement.
Dr. Aiuto ia scheduled to be sentenced on September 19, 1995,
before United States ~ietrict Judge Emmet Sullivan. He faces a
maximum sentence of 10 years imprisonment and a fine of $250,000.
United Statee Attorney Eric H. Holder, Jr. praised the
investigative efforts of Special Agente Paul Coleman and Catherine
Hickey from the Office of Inspector General at the National Science
Foundation. He a l e o praised the work of Assistant United States
Attorney Leslie Ann Gerardo, who proeecuted the caee.
4 05/16;95 TLIE 17:16 FAX 2 0 2 514 8782 PZTBLI C CORRUPT
9
U.S. Departmen of Justice
United States Attorney
Dtrnict of Columbia
April 21, 1995
Robert A. Gingell, squire
Gingell & Jenkins
Suite 5 0 6
Wheaton Plaza South
11160 viers Mill Road
silver Spring, MD 20902
Re: United States v. Russell Aiuto
Dear Mr. Gingell:
This letter sets forth the full and complete plea offer from
the Office of the United States Attorney for the District of
Columbia to your client, RUBBELL AZUTO, and supersedes any previous
offer. This offer is binding only upon the United States
Attorney's Off ice for the District of Columbia. There are no other
agreements, promises, terms or conditions expressed or implied.
The plea offer expires at 5 : 3 0 p.m. on Friday, May 12, 1 9 9 5 . If
your client intends to accept this offer, then a copy of this
letter, signed by your client, must be delivered or faxed to my
office by 5:30 p.m- on Friday, May 12, 1995. My office fax number
is (202) 5 1 4 - 8 7 8 2 .
PLEA AGREEMENT
The United S t a t e s , by and through its representative, t h e
United states Attorney's Office for the District of Columbia,
e n t e s s into the f with the defendant RUSSELL
AIUTO :
1. CHARGES, POTENTIAL P E ~ ~ L T I EAND
S ASSESSHENTS
111
(a) RUSSELL AIUTO will plead guilty to an
information charging him a program
receiving ~edera'lfunds is a felony
offense, and will expose possible penalty of
a fine of not more than of not more than 10
years, and a special 5
.
to 18 U.S.C.
3013 (a)(2) (A)
(b) Defendant understands sentencing in t h i s case shall
be imposed pursuant to the Sonte Guidelines promulgated by the
05/'16'95 TUE 17:16 FAX 2 0 3 514 8782
.
United States sentencing commission, as codified at 18 U. S.C. 53551
and sections following
(c) Defendant understands that if the court determines that
the Sentencing Guideline range is greater than what defendant and
defense counsel believe to be correct, then defendant is still
bound by this Plea Agreement.
The plea of g u i l t y in t h i be based upon a factual
admission of guilt by offense charged. This
admission by the the Court. The plea
of guilty will be ith Rule 11 of the Federal
Rules of Criminal Procedure.
3.
b
Defendant AGRBZS to t s f o l l ~ 3 i n gadditional conditions:
wou.i
(a) WAIVER OF CONBTIFUTI L AND IBTAFUTORY RIGHTB
(i1 waiver of co:2stitut:. nal R i q h t s -- Defendant
understands that by pleading ty in this case, defendant w i l l be
giving up the following con tional rights: the right to be
indicted by a grand jury, th t to plead not g u i l t y , the right
to a jury trial at which de t woild have the opportunity to
present evidence, testify in de'endant1s own behalf, cross-examine
witnesses, and to be represent~dby c:, n s e l - If defendant chose
not to testify at such a trial., then hat decision could not be
held against defendant. Defentant be innocent until proven
guilty beyond a reasonable doub: and the burden of proof would rest
upon the United States. If defendant J+ re found guilty after such
a trial, then defendant would have the right t o appeal the
conviction.
(ii) Waiver of ~tadutorv idiqhta --
Defendant also
understands t h a t , as part of &nterin$ into this Plea Agreement,
defendant also specifically waives an rights that defendant may
P
have had under the Spee y ria:. Act, 18 U.S.C. d 3161, &. a.
!
The United States droffers shall be the amount
of loss used to calculate Characteristic
pursuant to g 281.1 '(b) Sentencing
Guidelines (sentencing of loss
caused by defendant.
(c) RESTITUTION
Defendant AGREES that 8
I li shall be the amount of
restitution to be paid by de as are
determined by the United State
. -
. 05/16/95 TUE 17:17 FAX 2 0 2 514 8782 PUBLIC CORRUPT
(d) NO WAIVER OF C I V I L REMEDIES
Defendant UNDERSTANDS AND this Plea Agreement
affects only criminal charges construed, in whole
or in any p a r t , as a compromise of any
remedies available to U.S.C. § 3729, &.
M . , or any other united States by
law. '
(e) UBE OF INFORMATION
Defendant AGREES that the
I may make derivatiee
suggested by ariy
defendant i s ever
a witness i n any may be cross-
examined that defendant
Defendant AGREES t h a t if ails to comply with any of
the provisions of this Plea or refuses to answer any
questions put t o defendant, any f a l s e or misleading
statements to investigators, to cooperate w i t h
investigators and attorneys or makes false or
misleading statements court, or commits
have the sight to
Agreement, in
which case the under this
agreement will be the right to
be charged
any other
not time-
of the
paragraph.
Defendant understands the United States shall
only be required to Plea Agreement by a
preponderance of the understands and
-
. -
agrees that the United States need only prove a violation of
Federal, state and local criminal law by probable cause in order to
establish a breach of this Plea Agreemeqt.
(g) SENTENCE WITHIN DISCRETION OF THE COURT
Defendant UNDERSTAND@ that the ate sentence to be imposed
in this case is a matter solely discretion of the Court.
4. As part of this Plea Agreemen , the United States agrees
to the following:
(a) NO ADDITION&L CRARGES
If defendant completely fulfills
Plea Agreement, then the United States
District of Columbia agrees to bring no
against defendant for any offenses
employment with the National
concerning the National Science
Sequence, & Coordination Project.
(b) BENTENCING Q U X m X N E B RANGE
If defendant completely fulfills
Plea Agreement, then the United States
District of Columbia will not oppose
t h e lover part of the applicable
the United States Probation
Guidelines.
(c) ACCEPTANCE OF RESPONSIBILITY
If defendant completely fulfills
I
Plea Agreement, then the united
District of Columbia will not
level downward adjustment for
t o § 3El.l of the
continues to show
cooperation with the
(d) WAIVER OF STEP-BACK
If defendant completely fulfills
I 11 obligations under this
Plea Agreement, then the United Attorney's office for the
~istrict of Columbia will not defendant be detained
pending sentencing.
5. RESERVATION OF ALLOCUTION
I
d
Except as limited in Paragraph 4 ( b ) , the United States
reserves the right to full allocution a sentencing, including the
UJI 10: v i ) L C I ~1 1 ; 10 rnli i u r a14 a f a r rCIbL1 C; LUKKllYl'
I '
--
"
right to s e t forth at sentencing its evidence with respect
to defendant's criminal 'activitie
6. RESERVATION OF'RIGHT TO CONTEST THE PRESENTENCE REPORT
The United States rdserves to inform the presentence
report writer and the Court of an ant facts, to dispute any
factual inaccuracies in khe report and to contest any
matters not provided for1 in reement.
I
8. RESERVATION OFI RIGHT TOAPPEALL, AND DEFEND TEE BFNTENCE
i
The United States reserves th rig to appeal the sentence in
this case and reserves theth.;. tak:f.ny position in defense of
an appeal by defendant in t is ca e.
Defendant UNDERSTAND
promises, understandings,
parties or their counsel
herein, nor will any such
representations be made u
I
GREES that no other agreements,
sentations have been made by the
than t ose contained in writing
nts, promises, understandings or
mmitted to writing and signed by
defendant, defense counse Assietant United States Attorney
for the District of Colu
I I Sincerely,
ERIC H . HOLDER, Jr.
UNITED STATES ATTORNEY
* 05/16/'95 TUE l7:lS FAX 2 0 2 514 8782 PUBLIC CORRUPT
I
I have read the foregoing terms and c o n d i t i o n s and I have
discussed them with my attorney. I f u l l y understand and accept
them. T h i s agreement i s executed v o l u n t a r i l y and of m y own free
will. N o promises, commitments, or understandings have been made
to m e in connection w i t h the execution of t h i s agreement other than
those set forth above. I hereby indicate my assent and agreement
to all of t h e terms and conditions of t h i s agreement by m y
signature below.
RUSSELL AIUTO
I am the attorney for defendant. I have c a r e f u l l y reviewed
every part of t h i s P l e a Agreement with the defendant. It
accurately and completely sets for the entire agreement between t h e
defendant and t h e Office of the United States Attorney for the
District of Columbia.
CO
9
SEL FOR DEFENDANT
Grant Fraud
Published by the National Science Foundation, Office of Inspector General on 1995-11-21.
Below is a raw (and likely hideous) rendition of the original report. (PDF)