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‘Clearly False’ Statements, ‘Premeditation,’ Past Issues Trigger $2.4M Payment by UTHSC

Federal auditors have warned for years that institutions and principal investigators (PIs) have to walk a fine line when using award funds: A fast spending or “burn rate” could put a project at risk if the money runs out too soon. At the same time, making a big purchase at the end of a period of performance is also a no-no if the items seem unnecessary to complete the research.

The consequences of managing funds inappropriately were recently driven home by a $2.4 million False Claims Act (FCA) settlement between a genetics center at the University of Texas Health Sciences Center (UTHSC) and the Department of Justice (DOJ). The payment is twice the amount the government alleges UTHSC’s Human Genetics Center “misappropriated” from an NIH grant. At issue, according to DOJ’s Jan. 31 news release, was the center’s prepaid purchase of $1.2 million in equipment near the end of a grant, followed by cancellation and receipt of a credit it spent after the award expired.

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