oversight

SBIR

Published by the National Science Foundation, Office of Inspector General on 2003-03-31.

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: I99090034                                                                Page 1 of 1



        In September 1999, we identified that a company' submitted proposal to the NSF Small
        Business Innovation Research (SBIR) Program, and then submitted a very similar proposal
        to the U.S. Air Force (USAF) SBIR Program. In April 1996, the company received Phase I
        awards from both agencies, $75,000 from NSF and $99,962 from USAF. The company did
        not disclose the very similar USAF project to NSF, and falsely certified to NSF that the
        company had "not accepted funding for the same or overlapping work . . .." The company
        subsequently submitted Phase I Reports to NSF and USAF, and most of the results in the
        NSF report were also reported to USAF as results from that project.

        However, both Phase I reports also contained distinct results, and the Phase I1 proposals
        submitted by the company to NSF and USAF contained less overlapping material than the
        Phase I proposals had. (Again, both proposals disclaimed the existence of any overlapping
        proposals or awards from other agencies, and both omitted mentioning either the award from
        or proposal to the other agency in the Current and Pending Support section of the proposal.)
        Both Phase I1 proposals were awarded, and the results reported in the final reports to NSF
        and USAF were quite different.

        At our request, the NSF SBIR Program reviewed the Phase I proposals and concluded that it
        would not have awarded the NSF Phase I grant if it had known about the USAF project. The
        Program also reviewed the Phase I final reports and concluded that there was so much
        overlap that it would not have funded the NSF Phase I1 proposal if the company had
        disclosed the existence of the USAF Phase I award and Phase I1 proposal. We also asked an
        outside expert to review the proposals and reports, and he independently came to the same
        conclusions.

        NSF suspended the Phase I1 award and refused to release $58,000 awarded under the NSF
        Phase I1 grant. We referred our findings to the US Attorney's Office, who began
        negotiations with the company. The company and the US Attorney's Office agreed to a civil
        settlement allowing NSF to keep the remaining $58,000 and the company reimburse another
        $10,000 to NSF, and no administrative action would be imposed regarding this matter.

        Accordingly, this case is closed.