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Resolving SBIR/STTR Allegations of Waste, Fraud,

and Abuse -NIH Perspective

Presented by: Maritza Zeiberg, CPA,

Director, Division of Program Integrity, OMA, Office of the NIH

DirectorOctober 23, 2014

Presenter

Director, Division of Program Integrity

27 years at HHS; 19 at NIH 1,000+ reviews $40 million recovered $500 million put to better use 

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Purpose of Presentation

Describe DPI Roles and responsibilities Process for resolving SBIR/STTR

allegations Actions for SBIR/STTR recipients Discuss current issues and

potential solutions Questions and answers

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DPI Responsibilities

Provide NIH with a centralized review capability for allegations of waste, fraud, abuse, and mismanagement

Review issues referred from OIG NIH Liaison with OIG Office of

Investigations, DOJ, and other law enforcement organizations

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DPI Authority

Misuse of Grant Funds– 45 C.F.R. 74.53 (e) - authority to conduct reviews of NIH grantees’ records and interview grantees’ personnel.

Misuse of Contract Funds– 48 C.F.R. 52.215-2 (FAR) provides the authority to access records of NIH contractors.

Employee Misconduct – Section 402(b)(1) of the PHS Act, 42 U.S.C. 282(b)(1) provides authority to conduct reviews of allegations of improper conduct by NIH employees.

DPI Purview Limitations

Scientific Misconduct

NIH Extramural Research Integrity Liaison Officer, OEROffice of Research Integrity, HHS

Human Subject Issues

Office for Human Research Protections, HHS

Animal Welfare Issues

Office of Laboratory Animal Welfare, NIH

Criminal Activities Office of Inspector General, HHS

Personnel Matters

Office of Human Resources, NIH

Discrimination/Harassment

Office of Equal Opportunity and Diversity Management, NIH

Disputes between Contractors and Subcontractors

NIH does not have a direct contractual or legal relationship with subcontractors

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Impact

Recovered $6.5 per $1 spent in FY13

Provide data for decision making that allows the government to put money to better use

Improve policies and internal controls at NIH and grantee institutions

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FY13 NIH Funding

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Research grants – $20.9 billion Contracts – $4.3 billion SBIR – $617 million STTR – $80 million

Funding Environment

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Twohy, Mike. “Defunding Increases Aggression.” Illustration. The New Yorker, May 9, 2011.

Sources of Allegations

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External35%

Internal 29%

OIG Hot-line26%

OIG Info Requests

5%

OIG OI Re-ferrals for Admin Ac-

tion5%

Active Cases

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Grants60%

Employee Misconduct

20%

Contracts12%

Other8%

Proportion of SBIR/STTR Cases

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SBIR/STTR 7%

Other93%

SBIR/STTR Other

Review Process

Acknowledge AllegationStress Confidentiality

Prepare Review PlanIdentify Issues, Criteria, Evidence

Notify IC and SBCCoop./Confidentiality Agreement, Request Info

Analyze DataSolicit Expert Opinions, Conduct Interviews

Prepare ReportReport to IC Director and SBC

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What to do if….

…We notify you that we are reviewing your award? Sign cooperation & confidentiality

agreement

Be responsive to our request

Call us if you have questions

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Sample Notification

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Collaborative Review Process

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DPI

Scientific

GrantsContract

sPolicy

Recommendations

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issues report w/recs

DPIcloses case

implements recs

SBCinforms IC of

actions taken in response to recs

initiate action with SBC

NIH ICinforms DPI of SBC actions

Areas of Concern

Eligibility and general noncompliance

Overlap Inadequate documentation Award transfers

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Findings

Providing false information on applications

Requesting funds for work that is complete

Using funds for other research activities

Overlap of NIH and Non-NIH support

Performing work outside the USA 19

Overlap

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Budgetary Commitment Scientific

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~$30,000!

Monetary Rewards for Publishing

Possible Solutions

Educate staff and raise awareness Define roles and responsibilities Maintain complete financial and

scientific records Disclose sources of support Establish a culture of compliance Provide timely and unrestricted

access to records

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Actions We Take When We Find Indicators of Possible Criminal

Activity

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Fraud Indicators

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Missing or incomplete support for award expenditures and scientific progress

Evasiveness/non-responsive/time extension requests to federal staff inquiries

Favors, gifts, money, gratuities to grant/contract to staff at funding agency

Early requests for next SBIR/STTR phase funding

Lax enforcement of award requirements

Multiple complaints

Failure to obtain approval for significant budget or scope changes or for substitutions to key personnel

Criminal Issues

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DPI Contact Information

To report any concerns, please contact us.

Phone: (301) 496-5586Web site: http://oma.od.nih.govMail: National Institutes of Health

Office of Management Assessment

Division of Program Integrity6011 Executive BoulevardSuite 601, MSC 7669Rockville, Maryland 20852