From the Manhattan branch of the US Attorney's Office charged:
The United States’ Complaint-In-Intervention (the “Complaint”) alleges that from July 1, 2003, through June 30, 2015, COLUMBIA impermissibly applied its “on-campus” indirect cost rate – instead of the much lower “off-campus” indirect cost rate – when seeking federal reimbursement for 423 NIH grants where the research was primarily performed at off-campus facilities owned and operated by the State of New York and New York City. The Complaint further alleges that COLUMBIA failed to disclose to NIH that it did not own or operate these facilities and that COLUMBIA did not pay for use of the space for most of the relevant period.
...and Columbia University admitted:
COLUMBIA has admitted that it applied the on-campus indirect cost rate to the 423 NIH grants even though the research was primarily performed in space not owned or operated by Columbia, and that it submitted to NIH certified reports that used the on-campus indirect cost rate to calculate the indirect cost amounts claimed by the university.
Ah, those tricky accountants.
Oh. cool. paging down on the complaint we get some specifics:
From July 1, 2003, through June 30, 2015, COLUMBIA’s On-Campus F&A Rate was approximately 61 percent, its Off-Campus F&A Rate was 26 percent, and its Modified Off-Campus F&A Rate was 29.4 percent. The Modified Off-Campus F&A Rate was to be applied to research conducted off-campus but within a certain proximity of the COLUMBIA campus.
Y'know. When I first read this my first thought was that I know some Columbia folks that work off campus at.... oh shit. It's them. It's the drug abuse folks.
COLUMBIA has a collaborative relationship with the New York State Psychiatric Institute (“NYSPI”), a clinical research facility administered by the New York State Office of Mental Health. COLUMBIA faculty perform research in two off-campus buildings owned by the State of New York and operated by NYSPI (the “NYSPI Buildings”). COLUMBIA faculty also perform research in another off-campus building owned and operated by the City of New York (the “City Building”).
For most of the relevant period, COLUMBIA did not pay the State of New York for use of the NYSPI Buildings, and therefore did not incur indirect “facilities-related” costs with respect to the medical research performed in these buildings. Similarly, COLUMBIA did not pay the City of New York for use of the City Building.
Presumably my friends who are the PIs on these grants had no idea. I have no idea what my institution actually charges the NIH as overhead on my grants, all I look at is my direct cost expenditures and balances. But still, sorry to see that it was their research grants that were involved. If nothing else it means that NIDA [Update: I found some details and 22/423 total grants were driect listings from NIDA, although there are what look like subaward identifiers (that may or may not involve other NIDA grants.)] was the entity being ripped off. The settlement was for $9.5 million. It doesn't say how much of this is direct recovery for the fraud and how much is court costs or punishment.
oh, wait. Damn. This looks bad.
COLUMBIA did not state on the applications for the NIH Grants that the research would be primarily performed off-campus, as required. Instead, Columbia frequently included the main address for the College of Physicians & Surgeons in the section of the application that was supposed to list the primary performance location. Even where the NYSPI Buildings or the City Building were listed in that section of the grant application, or mentioned elsewhere in the application, COLUMBIA failed to disclose that these buildings were not owned and operated by the university.
Starting in fiscal year 2009, in lieu of paying rent for use of one of the NYSPI Buildings, the Department of Neuroscience paid NYSPI a portion of the inflated indirect cost recoveries it received from NIH for research projects performed in that building.
This smells a lot more like highly intentional fraud and less like a mistake that someone should have caught. In the pre-award review of the grant, if you ask me. Especially when CU was clearly negotiating the rental arrangements with NYSPI. Someone pretty high up in the office of grants and contracts had to be doing this whole charade intentionally and with planning. There are a handful of other regulatory issues that I don't want to get into which very likely pointed a spotlight on the "performance location" too. This had to be intentional.
Turns out that this was a whistleblower case.
In connection with the filing of the lawsuit and settlement, the Government joined a private whistleblower lawsuit that had previously been filed under seal pursuant to the False Claims Act.
Good for that brave person for bringing this to light.
Final thought: I bet you that Columbia University is not the only NIH funded University out there that pulls some shenanigans like this. Now, you would think that there would be some sort of broad and universal alert sent to the Signing Officials of each University that has an on- and off-campus rate. Telling them to get their act together on this or any future investigation that busts them will automatically have the fines tripled. But going by at least one narrow similar area that I've followed over the past couple of decades (the anti-lobbying / grant writing thing) apparently this does not happen. So keep your eyes peeled for the next decade. I bet there will be more of these and that in each case it will again be figured out only via whistleblower.