Tag Archives: Grant Fraud

Tanzania’s Contract Registration Board Holds First Procurement Fraud Best Practices Workshop With Assistance From GeyerGorey LLP

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From February 25 through March 1st 2013, at the Grand Hyatt in Dubai, United Arab Emirates, the Contractors’ Registration Board (CRB) of Tanzania hosted the first in a series of comprehensive multi-day procurement fraud training programs.

FOR IMMEDIATE RELEASE

PRLog (Press Release) – Mar. 21, 2013 – From February 25 through March 1st 2013, at the Grand Hyatt in Dubai, United Arab Emirates, the Contractors’ Registration Board (CRB) of Tanzania hosted the first in a series of comprehensive multi-day procurement fraud training programs.

Chief Executive Officer Bonaface Megage announced that the CRB intended this program to be the beginning of a national procurement fraud initiative established to promote the early detection, prevention and prosecution of procurement fraud associated with increased contracting activity for government programs necessary to support a growing Tanzanian economy.  “In the weeks and months to come, we will be reaching out to other agencies within Tanzania and asking them for their support in our continuing efforts to eliminate fraud from the procurement process,” stated CRB’s Chairman of the Board Consolata Ngimbwa.  “We wanted to create the leading best practices contracting program in our region of the world and that is why we invited business sector leaders in the Tanzanian economy to incorporate their experiences and help us shape a fraud enforcement program that is in parity with other international programs and yet still unique to Tanzania.”
Conceived and coordinated under the capable guidance and supervision of Professor Charles Inyangete, of T-Mortgage Limited, a noted scholar, advisor and consultant on the African continent involving procurement, finance, economic policy, banking and financial risk, the conference incorporated three full days of instruction and included a final day “Master Class” that blended US case hypotheticals with Tanzanian enforcement experience.  “We were immensely pleased with the advice, counsel and three days of instruction provided by Bradford L Geyer (from GeyerGorey LLP, an American law firm based out of New York and Washington D.C. that specializes on international fraud enforcement programs, compliance and white collar defense).  “Mr. Geyer used a five year period of American experience of Overseas Contingency Operations Contracting and compared and contrasted it with the challenges we face here in Tanzania.  While doing so, he familiarized our participants with cutting edge technologies in best contracting practices and compliance that focused on competition, antitrust, Foreign Corrupt Practices Act (FCPA), anti-money laundering, reporting structures, document control and preservation, and risk management.”

CRB Vice Chairman Joseph Tango stated that “[Tanzanians] and the international community are committed to preserving our ethical contracting environment in Tanzania.  We recognize that the companies we need to engage desire to operate in a competitive environment that is predictable, ethical and safe from corruption. This should be a welcome call especially to European and American companies who seek to become responsible business partners in our development efforts, but it is also a warning shot to those who would seek to corrupt and pervert our system.  Currently, our system like every other on the globe faces challenges in this regard, but we stand committed to overcoming these challenges.”

The participants in the first Tanzanian Contract and Procurement Fraud Workshop were selected from inside and outside of Tanzanian government for their expertise, experience and leadership qualities and had agreed by consensus to incorporate the technologies they learned at the conference back to their home offices to share with colleagues.

Professor Sentenced to 41 Months for Grant Fraud

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Although we were unable to locate a press release issued by the US Attorney’s Office in M.D. Pa, a professor charged on January 31, 2012 with grant fraud, received a stiff sentence: 3.5 years in prison and $660,000 restitution.  More than 100 letters were received by the court advocating leniency (including from the professor’s thesis adviser and from a current financial backer of his research).  Despite this and powerful testimony from supporters (including his father), the court meted out what must have been seen by the defendant, his family and supporters as very harsh justice.

PennLive.Com article on sentencing

Original US Attorney’s 1-31-12 Press Release below:

Former Penn State Professor Charged In $3 Million Federal Research Grant Fraud

FOR IMMEDIATE RELEASE
January 31, 2012

The United States Attorney’s Office for the Middle District of Pennsylvania announced that a felony Information has been filed in United States District Court in Harrisburg against Craig Grimes, age 55, of Raleigh, North Carolina, charging him with wire fraud, false statements, and money laundering. During the time period alleged in the Information, Grimes resided in Boalsburg, Pennsylvania, and was a Professor of Material Science and Engineering at The Pennsylvania State University.

According to United States Attorney Peter J. Smith, Count I of the Information charges that between June 30, 2006, and February 1, 2011, Grimes defrauded the National Institutes of Health (“NIH”) of federal grant monies. The NIH, a component of the United States Department of Health and Human Services, provides funding for medical research through grants.

Grimes, acting through his solely-owned company, SentechBiomed, State College, PA requested a $1,196,359.00 grant from NIH to perform research related to the measurement of gases in a patient’s blood. The measurement of these gases was purported to be relevant to detecting the presence of a disease in infants known as necrotizing enterocolitis.

In the application, Grimes specifically represented to NIH that he would direct approximately $509,274.00 to the Hershey Medical Center to conduct clinical research on adult and infant subjects. The money was never paid. Instead, the grant funds were misappropriated, in part, by Grimes for his own use. The clinical studies/trials were not performed.

Count II of the Information charges Grimes with allegedly making false statements to the United States Department of Energy in connection with a second federal grant. In August 2009, Grimes, while a PSU professor, completed a grant application seeking a $1,908,732.00 grant from the Advanced Research Projects Agency – Energy(ARPA-E) which was created to foster research and development of energy-related technologies. The ARPA-E grant was funded by the American Recovery and Reinvestment Act.

ARPA-E seeks to avoid funding research already funded by other government and private entities. It requires applicants for grants to disclose other funding sources. In the application Grimes completed and had submitted to ARPA-E, he allegedly stated there was no other funding, when, in fact, he had received a grant from the National Science Foundation.

Count III of the Information charges Grimes with money laundering the proceeds of the fraudulent proceeds he received from the National Institutes of Health.

United States Attorney Smith stated, “Fraud in connection with federally funded university research harms public health and safety and damages our scientific and educational institutions. Such cases will be investigated and prosecuted as vigorously as any other type of serious economic crimes. Anyone with information concerning suspected research fraud should contact the Office of Inspector General for the appropriate federal agency.”

Greg Friedman, Inspector General, U.S. Department of Energy, stated that “The Department of Energy is a major underwriter of energy research in the United States. Cases that impact the integrity of the process are important to us. Abuse of the system is unacceptable. I would like to thank the United States Attorney’s Office and the IG Special Agents who worked tirelessly on this case. This investigation and prosecution demonstrate our commitment to holding those who defraud the Department accountable for their actions.”

“NIH grants billions in taxpayer funds each year to advance vital medical research,” said Nicholas DiGiulio, the Philadelphia Region’s Special Agent in Charge for the Office of Inspector General of the Department of Health and Human Services. “Every dollar is precious, so any misappropriation of these funds – as the government charges Mr. Grimes today – will be investigated aggressively.”

If convicted, Grimes faces up to thirty-five years in prison and a fine of $750,000.

Fraud related to U.S. Department of Energy may be reported to: (800) 541-1625.

Fraud related to U.S. Department of Health and Human Services, including U.S. National Institutes of Health, grants and programs may be reported to: 1-800-HHS-TIPS (1-800-447-8477).

Fraud related to U.S. National Science Foundation grants and programs may be reported to: 703-292-7100.

The investigation is being conducted by special agents of the Department of Energy, Office of Inspector General, the National Science Foundation, the Department of Health and Human Services, and the IRS. Prosecution is assigned to Assistant United States Attorney Joseph J. Terz.

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An Indictment or Information is not evidence of guilt but simply a description of the charge made by the Grand Jury and/or United States Attorney against a defendant. A charged Defendant is presumed innocent until a jury returns a unanimous finding that the United States has proven the defendant’s guilt beyond a reasonable doubt or until the defendant has pled guilty to the charges.