Columbia to Pay $9M for Fake AIDS Grant Reports

(CN) - Columbia University admitted it faked cost reports for a federal grant to underwrite work at its International Center for AIDS Care and Treatment Programs that was never done and will pay over $9 million in penalties, the Justice Department said.

In a simultaneous lawsuit and settlement filed Tuesday, the university admitted that it submitted false claims for federal grants to fund HIV and AIDS related work by ICAP, a program administered by the university's Mailman School of Public Health. A lack of oversight and shoddy accounting led to false reporting, according to the complaint.

The grants required Columbia to track the work done by nearly 200 ICAP employees, and to bill their salaries according to how much time they actually spent working on grant projects. But the university rarely asked questions about how employees spent their time, leading to overcharges and flat-out fraud.

"ICAP's management was well aware of its problems," the Justice Department's complaint states. "One ICAP director stated to a colleague in 2009 that effort reports were 'notoriously inaccurate' but that he 'usually just certified whatever is listed.' Later in 2009, a finance director mused in a communication to another of ICAP's directors that 'how we distribute effort among grants is one of the great lingering problems.' In 2006, an ICAP director (and a principal investigator for Columbia's multicountry antiretroviral program grant) stated in an internal memo about a funding dispute between ICAP and Columbia that ICAP was 'fortunate to have large direct cost budgets. But we cannot continue to put inappropriate charges on those budgets to cover the shortfall created by the school's failure to honor its commitment.'" [Parentheses in original complaint.]

Preet Bharara, the U.S. Attorney for the Southern District of New York said that while Columbia's global work to fight HIV and AIDS is admirable, it doesn't justify squandering taxpayer dollars on a lack of oversight.

"Columbia University and ICAP applied to the federal government and received many millions of dollars to fund AIDS and HIV projects around the world," Bharara said. "We admire and applaud Columbia's work in combating AIDS and HIV. But grantees cannot disregard the terms under which grant money is provided. Grantees are required to use federal money for the purpose for which the grant was given and nothing else. The applicable rules are clear, and they are at the core of ensuring that tax dollars are appropriately spent. Educational institutions, like everyone else, should be held accountable when they fail to follow those rules."

Thomas O'Donnell, the special agent in charge of investigating Columbia for the Health and Human Services Department, agreed.

"Violating rules designed to protect HIV-AIDS grant programs leads to wasteful spending, squandering vital funds that could be used to help end this worldwide epidemic," he said. "As HHS is the largest grant-making organization in the federal government, HHS is committed to protecting these grants and will work tirelessly to ensure all money is used properly."

All told, Columbia will fork over $9,020,073 to settle the suit, which has been approved by U.S. District Judge Lorna Schofield.

Assistant U.S. Attorney Rebecca Martin handled the case for the government.

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