University of Florida To Pay Around $19.9M in False Claims Settlement

December 1, 2015 | By Jerry Ashworth | Post a Comment

gavel-1238036This came across our desks recently and serves as a perfect example of what NOT to do as a grant recipient. According to the Department of Justice (DOJ), the University of Florida has agreed to pay almost $19.9 million to settle allegations that the university improperly charged the Department of Health and Human Services (HHS) for salary and administrative costs on hundreds of federal grants.

“Grantees must have internal controls promoting accountability and transparency,” said HHS Regional Inspector General for Audit Lori S. Pilcher. “Taxpayers should expect nothing less.” Internal controls are even more vital now under the Office of Management and Budget’s uniform grant guidance (§200.303).

The settlement last month resolves the alleged misuse of grant funds awarded by HHS to the University of Florida between 2005 and December 2010. The federal government contended that the university overcharged hundreds of grants for the salary costs of its employees because it did not have documentation to support the level of effort claimed on the grants for those employees. In addition, it contended that the university charged equipment and supplies as administrative costs when those items should not have been directly charged to the grants. It also claimed that the university inflated costs charged to HHS grants awarded at its Jacksonville campus for services performed by an affiliated entity, Jacksonville Healthcare Inc.

The settlement resulted from a coordinated effort by the DOJ Civil Division’s Commercial Litigation Branch and the HHS Office of the Inspector General, Office of Audit Services and Office of Investigations. DOJ notes that the claims resolved by the settlement are allegations only; there has been no determination of liability.

We have written numerous articles about grant recipients required to repay federal funds for costs that have been disallowed and for improper management of their funds. A settlement of this magnitude should serve as a wake-up call for other recipients managing their federal funds. Don’t find yourself in a similar predicament. Thompson’s grants publications can serve as a useful tool to help you stay on track and manage your funds properly. Implementing internal controls and proper documentation are critical, as this settlement clearly shows.

Let us know your reaction to this settlement. We’d like to hear from you.



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