Consumer Fraud

University of Florida Pays $20 Million to Settle Complaint Alleging Grant Fraud

whistleblower 2 370x210 University of Florida Pays $20 Million to Settle Complaint Alleging Grant FraudThe University of Florida will pay the U.S. government nearly $20 million to settle allegations that it overcharged the Health and Human Services Department (HHS) for salary and administrative costs on hundreds of federal grants and misused grant funds.

The federal government filed a False Claims Act complaint against the University of Florida after a Health Care Fraud Prevention and Enforcement Action Team (HEAT) investigation uncovered evidence of fraud. The Justice Department’s Civil Division’s Commercial Litigation Branch and the Dept. of Health and Human Services office of the Inspector General coordinated the settlement with the University of Florida.

The University of Florida receives funds for hundreds of grants from the Dept. of Health and Human Services (HHS) every year. According to the complaint, the university overstated the salary costs for its employees on these grants and did not have documentation to support those inflated costs.

The government also contended that the university improperly charged some of these grants for administrative costs involving equipment and supplies, which violated federal grant regulations.

The University of Florida also inflated costs for grants awarded to its Jacksonville campus for services performed by Jacksonville Healthcare, a UF affiliate, the government alleged, claiming that the university misused grant funds by funneling them to non-approved projects between 2005 and late 2010.

“The monies utilized by HHS to fund important medical research and clinical programs across the nation are both precious and limited,” said Principal Deputy Assistant Attorney General Benjamin Mizer. “Today’s settlement demonstrates that the Department of Justice will pursue grantees that knowingly divert those funds from the projects for which they were provided.”

The federal government and its agencies can sue grant recipients for fraud and other wrongdoing under the False Claims Act, one of the best fraud-busting weapons in its anti-corruption arsenal. Most False Claims lawsuits, however, are filed by private individuals under the Act’s “whistleblower” provisions, which authorize them to sue on behalf of the government and share a percentage of any recovery in excess of $1 million.

Whistleblowers whose False Claims lawsuits result in a recovery for the U.S. government receive between 15 and 30 percent of the total amount recovered. Last year, the U.S. recovered nearly $3 billion from False Claims Act cases filed by whistleblowers. Awards for whistleblowers during the same period topped $435 million.

Source: U.S. Department of Justice