Fraud, waste, abuse, NIH grant funds, misuse, embezzlement, misappropriation, prison, Program Fraud Civil Remedies Act, Criminal False Claims Act

2.3.10 Fraud, Waste and Abuse of NIH Grant Funds

Any individual who becomes aware of the existence (or apparent existence) of fraud, waste, or abuse related to NIH grants or grant funds should consider contact:

In addition, allegations of criminal offenses should be reported to the Department of Health and Human Services, OIG Hotline.

The OIG has authority within HHS to conduct criminal investigations. The HHS OIG maintains a post office box and a toll-free hotline for receiving information from individuals concerning fraud, waste, or abuse under HHS grants and cooperative agreements. The identity of the caller is kept confidential, and callers are not required to give their names. The address and telephone number of the OIG and the OIG hotline are included in Part III.

Further allegations of non-criminal misuse of grant funds, and recipient conflict of interest should be reported to the NIH OMA.

OMA provides a centralized management survey and review capability to promote program integrity, conducts appraisals of alleged incidents of waste, fraud, and abuse and has lead responsibility for cases received through the Office of Inspector General (OIG) Hotline that are referred to NIH for action. OMA has no authority to undertake criminal investigations. OMA refers all allegations of criminal offenses to the OIG for investigation. The address and telephone number for the OMA, DPI are included in Part III.

False statements involving falsified, fabricated, or plagiarized information identified during research misconduct Fabrication, falsification, or plagiarism in proposing, performing, or reviewing research, or in reporting research results. Fabrication is making up data or results and recording or reporting them. Falsification is manipulating research materials, equipment, or processes, or changing or omitting data or results such that research is not accurately represented in the research record. Plagiarism is the appropriation of another person's ideas, processes, results, or words without giving appropriate credit. Research misconduct does not include honest error or honest differences of opinion. proceedings should be reported to the NIH Extramural Research Integrity Officer.

Examples of fraud, waste, and abuse that should be reported include, but are not limited to, embezzlement, misuse, or misappropriation of grant funds or property, and false statements, whether by organizations or individuals. Other examples include theft of grant funds for personal use; using funds for non-grant-related purposes; theft of federally owned property or property acquired or leased under a grant; charging the Federal government for the services of "ghost" individuals; charging inflated building rental fees for a building owned by the recipient; submitting false financial reports; and submitting false financial data in bids submitted to the recipient (for eventual payment under the grant).

The Federal government may pursue administrative, civil, or criminal action under a variety of statutes relating to fraud and making false statement or claims. Part II includes administrative and other remedies the Federal government may use if a recipient deliberately withholds information or submits fraudulent information or does not comply with applicable requirements. Even if a grant is not awarded, the applicant may be subject to penalties if the information contained in or submitted as part of an application, including its certifications and assurances, is found to be false, fictitious, or fraudulent.

The Program Fraud Civil Remedies Act of 1986, 31 U.S.C. 3801 et seq., provides for the administrative imposition by HHS of civil penalties and assessments against any person who knowingly makes false, fictitious, or fraudulent claims to the Federal government for money, including money representing grants, loans, or benefits. A civil penalty of not more than $5,500 may be assessed for each such claim. If a grant is awarded and payment is made on a false or fraudulent claim, an assessment of not more than twice the amount of the claim, up to $150,000, may be made in lieu of damages. Regulations established by HHS at 45 CFR Part 79 specify the review process for imposing civil penalties and assessments, including hearing and appeal rights.

The Criminal False Claims Act, 18 U.S.C. 287, and 18 U.S.C. 1001, provides for criminal prosecution of a person who knowingly makes or presents any false, fictitious, or fraudulent statements or representations or claims against the United States. Violations of these statutes carry a maximum sentence of five and eight years imprisonment, respectively.

The Civil False Claims Act, 31 U.S.C. 3729(a), provides for imposition of penalties and damages by the United States, through civil litigation, against any person who knowingly makes a false or fraudulent claim for payment, makes or uses a false record or false statement to get a false claim paid or approved, or conspires to defraud the Federal government to get a false claim paid. A "claim" includes any request or demand for money or property made to the United States or to a contractor, recipient, or other recipient, if the Federal government provides or will reimburse any portion of the funds claimed. Civil penalties of $5,500 to $11,000 may be imposed for each false claim, plus damages of up to three times the amount of the damages the government sustains because of the violation, and the costs of any civil action brought to recover such penalties and damages.

NIH also may administratively recover misspent grant funds pursuant to the authorities contained in 2 CFR Part 200.