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
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)