Former UCSD prof’s company admits to grant fraud

court caseA company headed by a former astrophysicist at the University of California, San Diego, has agreed to forfeit $180,000 after admitting to defrauding the government.

If SciberQuest, Inc. is unable to pay back the money — the result of fraudulently obtaining government grants and contracts — then its CEO Homayoun Karimabadi will be personally liable, the lawyer for SciberQuest and Karimabadi told Retraction Watch.

We asked if the company was going to be able to repay the $180,000; in response, Robert Rose of firm Sheppard Mullin told us:

It hasn’t been worked out yet.

SciberQuest received approximately $6.4 million from more than 20 grants or contracts, including from the National Science Foundation (NSF) and National Aeronautics and Space Administration (NASA); some were Small Business Innovation Research awards, worth more than $1.7 million.

According to a press release from the U.S. Attorney’s Office:

To obtain the SciberQuest grants or contracts, Dr. Karimabadi made false statements to government officials.  Specifically, in award proposals, Dr. Karimabadi failed to disclose all of his and SciberQuest’s current and pending grants or contracts, thereby overstating the time he and SciberQuest could devote to the projects he was applying to receive.  In one example, Dr. Karimabadi only disclosed to NSF four current and eleven pending grants, and knowingly failed to disclose an additional ten current and five pending grants.  In all, Dr. Karimabadi disclosed to NSF only about three months per year of work that he was committed to, when in fact, he had already committed to various agencies over nineteen months per year of work.

Dr. Karimabadi also falsely certified in SBIR award proposals submitted to NASA and [United States Air Force] that he was primarily employed by SciberQuest.  In truth, he was employed full-time at UCSD both at the time of the award submission and during the performance of the grant.  Dr. Karimabadi and SciberQuest made these false statements to be awarded grants or contracts that they likely would not have received but for the deception.  As a result, from 2005 to 2013, Dr. Karimabadi received over $1.9 million in salary from SciberQuest due, in part, to the fraudulently obtained grants or contracts.

SciberQuest and Karimabadi were charged on January 7. The company pled guilty; Karimabadi pled not guilty. On January 15, Karimabadi entered into “a deferred prosecution agreement,” in which the government agreed to defer prosecution of him for three years, at which time the charges would be dismissed. For Karimabadi, Rose told us:

There won’t be a trial, there won’t be a verdict.

The next step, Rose said, is for the company to appear before the court for sentencing on March 18, before U.S. District Judge Gonzalo P. Curiel. At that time, the company could be put on probation and fined up to $300,000, said Rose.

The release from the U.S. Attorney’s General includes a statement from the NSF:

Allison Lerner, NSF Inspector General said, “Dr. Karimabadi violated the public trust to enrich himself when he fraudulently represented his work on NSF awards.  My office will continue to vigorously pursue those who attempt to illegally obtain scarce federal dollars intended for scientific research, and I commend the U.S. Attorney’s office for its sustained efforts in reaching this settlement agreement.”

The website for SciberQuest on its LinkedIn page is no longer active. According to the San Diego Union-Tribune, Karimabadi, 56, has a PhD in plasma astrophysics, “which includes areas of study such as solar eruptions and the formation of stars.” He lives in Del Mar.

Hat tip: Cheryl Clark

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2 thoughts on “Former UCSD prof’s company admits to grant fraud”

  1. This is very discouraging, a slap on the wrist for criminal behavior. At a minimum he needs to make full restitution, lose his job at UCSD, pay a fine, and serve some prison time. Why should we bother playing by the rules if the government is satisfied with a no teeth settlement agreement?

  2. ‘ Chris Hendrickson, Special Agent in Charge of the Defense Criminal Investigative Service Western Field Office, said “As this matter demonstrates, we are committed to investigate not only those who make false claims in supplying goods and services for the national defense, but also those who misrepresent research and submit deceitful intellectual representations. Any such abuses of the public trust for personal gain simply will not be tolerated.” ‘

    So let’s see

    ‘ from 2005 to 2013, Dr. Karimabadi received over $1.9 million in salary from SciberQuest due, in part, to the fraudulently obtained grants or contracts. ‘

    and the lack of toleration results in a fine of $180,000 and some as-yet unknown future fine against the company, not the individual

    ‘ Dr. Karimabadi and SciberQuest jointly agreed to forfeit $180,000 as money that was improperly received as a result of the fraud, in addition to a fine that will be imposed on the corporation at sentencing. ‘

    Now back to my honest low-paying research job. Such intolerance of abuse clearly demonstrates that crime does not pay.

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