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December 1, 2014 Grant Fraud

Northwestern University Researcher Settles Grant Fraud Allegations

Every year, the federal government puts billions of dollars toward medical research in the form of grants. Many of these grants are awarded to medical schools and research universities in order to advance efforts toward finding better treatments or possible cures for conditions like cancer, HIV/AIDS, heart disease, and various neurological disorders. These grants come with a lengthy contract agreement between the recipient and the government laying out the terms and conditions under which the recipient may use the money. At the crux of these agreements is the promise by the recipient to only use the grant money to further the stated research objective, and expenses must be carefully documented and submitted to the government on a regular basis.

In today’s case, famed Northwestern University was recently implicated in a False Claims Act case involving one of its former researchers – who ended up settling with the government individually following allegations of unlawful use of grant money. The University settled the matter separately for $2.9 million in 2013, thereby escaping liability for claims directly attributable to the school.

Details of Grant Fraud Case

Dr. Charles Bennett is a former research physician at Northwestern University’s preeminent Robert H. Lurie Comprehensive Center for Cancer in Chicago, and recently agreed to pay $475,000 to the federal government after investigations led to the exposure of possible grant fraud. While the university settled the claims against it last year, the individual researchers involved in the case are also possible False Claims Act defendants – especially if evidence tends to show that the researchers acted independently when committing the fraudulent acts.

According to allegations filed against Dr. Bennett in January, 2014, the doctor was working on cancer research using federal grant money allocated for the study of adverse drug events, multiple myeloma drugs, the blood disorder thrombotic thrombocytopenic purpura, and quality of care for cancer patients. However, the government alleges that Dr. Bennett used a portion of this grant money for personal family vacations, meals, hotel stays, trips for family and friends, and consulting fees for his brother and cousin.

The lawsuit was filed by Northwestern University’s purchasing coordinator in 2009 after discrepancies emerged in Dr. Bennett’s expense reports. The whistleblower will receive $80,750 for her role in exposing the fraud.

Pursuant to the details of the settlement agreement, the federal government reserves the right to refuse awarding grant money to Dr. Bennett for research projects in the future.

Dr. Bennett’s counsel commented on the matter, referring to the allegations as an “accounting error.” The University has similarly vehemently denied wrongdoing.

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