Compliance News is a recurring compliance communication for the University research community.  Established in March 2004, articles are published through the Research News Online.  Collected and submitted by OAR, Compliance News aligns with OAR's mission to promote compliance awareness in sponsored projects management with the University through assistance, education and communication.

Sources of news items includes: NCURA Research Compliance Newsletter, Chronicle of Higher Education, Policy Changes affecting research compliance (Policy Newsletter), and all University research compliance offices.

Submissions should be sent to Jennifer Englund at englu061@umn.edu

April 2008

Ten Misconduct Findings Result in 7 Debarments

The following excerpt is from the Office of Research Integrity's March 2008 newsletter.

Thirty-five percent of the 28 research misconduct cases closed by the Office of Research Integrity (ORI) in 2007 resulted in research misconduct findings. Seventy percent of the respondents in those cases were debarred from receiving government funding for periods ranging from three years to a lifetime. The ten respondents against whom misconduct findings were made include an associate professor, a surgical resident, two postdocs, three graduate students, a research associate, and two phlebotomists. All ten respondents were prohibited from serving in any advisory capacity to the Public Health Service. Administrative actions imposed on the three respondents who were not debarred include retraction of a published article, data certification, and the submission of a supervisory plan. From 2002-2006, ORI averaged 11 misconduct findings per year. Misconduct was found in 40% of the closed cases. Sixty-six percent of the respondents against whom misconduct findings were made were debarred.

The entire article is available at http://ori.dhhs.gov/publications/documents/Mar08ORINewsletter.pdf.

March 2008

NSF OIG '08 Work Plan Portends More Oversight of Grantees

Excerpted from Federal Grants News for Colleges and Universities February 2008 newsletter.

Throughout the National Science Foundation Office of Inspector General (NSF OIG) FY '08 Audit Plan, the NSF OIG points out the shortcomings in both NSF's oversight of grantees and of the grantees' grants management systems, particularly in financial management capabilities. To make its case, the plan cites a number of completed audits and concludes that:

NSF must have timely and effective risk assessment; award monitoring and closeout procedures to ensure that awardees are capable of administering NSF funds and that the grant expenditures are valid; accurate, allowable, and consistent with the project's goals and objectives.

To move toward these goals, the NSF OIG lists a series of planned audits in the preaward; active; and postaward phases to assess NSF's progress as well as the compliance level of the NSF grantees. Many of these audits target colleges and universities, and the NSF OIG says that completed audits continue to demonstrate that "NSF grantees, including colleges and universities, vary significantly in their financial management capabilities."

Under the report's preaward section, the NSF OIG says it will continue audits of the terms and conditions of NSF's large facility management agreements to determine their sufficiency and of the foundation's financial and programmatic oversight of its eight center programs. Universities that have large facilities agreements or research centers may experience various forms of increased monitoring from NSF in response to this OIG activity.

Prior Audits Drive New Audit Targets

As support for its audits of active awards, the NSF OIG cites a recent audit that found that over a five-year period approximately 42% of required annual performance reports had not been submitted. The report also draws attention to $62 million in unresolved questioned costs in numerous audit reports, underscoring the need for continued improvement in this area. Because of these findings, the NSF OIG audits will continue to focus on the adequacy of awardees' systems for safeguarding and properly accounting for NSF funds and overall compliance with federal and NSF award requirements. Audits of contractors also are planned to assess compliance with disclosed accounting practices, reasonableness of indirect cost rates, validity of allowable costs, and adequacy of accounting systems to manage NSF funds.

The NSF OIG will continue its labor effort audits at colleges and universities. While not stated in the plan, it is anticipated that approximately 30 grantee institutions will undergo review.

With regard to the closeout administrative policies, the NSF OIG will look at NSF's audit resolution process to determine whether NSF has adequate procedures and has taken effective corrective actions to resolve grantee audit findings and recommendations in both A-133 and OIG audits. The plan cites a 2004 OIG audit that found approximately 61 % of final technical reports were either submitted late or not at all and notes 74 instances of investigators who failed to submit final project reports but still received new NSF funding. The NSF OIG will follow up to see what corrective action NSF has taken to address these specific audit findings.

Previous oversight has come in the form of desk reviews, onsite reviews, audits of new and continuing grants and contracts, and requests for internal audit reports, and grantees should expect continuing compliance and system reviews as well as audits and increased monitoring and enforcement activities.

Link to the plan: www.nsf.gov/oig/fy08_audit_plan.pdf.

January 11, 2008

Levels and Trends: FY 2007 Awards and Proposal Data

Levels and Trends is an annual report of research, training, and public service work performed by the University of Minnesota and funded by external sponsors. The Fiscal Year 2007 institutional proposal and award data is available at http://www.oar.umn.edu/trends/index.cfm. For more information or questions, contact Mary Bendtsen at mbendtse@umn.edu or 612.624.0583.

November 9, 2007

Mercury Clean-Up and Compliance in Laboratories

The Resource Conservation and Recovery Act (RCRA) is the source of most regulations pertaining to mercury use at the University. Under RCRA, mercury-containing equipment like thermometers, manometers, barometers, mercury switches, bubblers, and many other commonly used items in labs are regulated when mercury is spilled or the item becomes a waste. Careful handling of mercury containing products is critical due to the extensive environmental damage that results from mercury releases.

Kolthoff Hall renovation activities exposed mercury contamination in sink traps, sewer pipes, casework, fume hoods, and chemical storage cabinets. Mercury contaminated dust was detected on surfaces in most of the labs. The financial cost for mercury clean up and disposal are in excess of $125,000. Mercury releases can be prevented by finding alternative mercury free instruments, always handling mercury with secondary containment, and moving mercury sources away from sinks.

For further information on mercury use in laboratories go to http://www.epa.gov/glnpo/bnsdocs/hgsbook/labs.pdf.

September 28, 2007

NSF Funding Requires RCR and Ethics Training

Institutions receiving awards from the National Science Foundation (NSF) are required to provide training in the responsible conduct of research (RCR), survival skills, and research ethics under the America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science (COMPETES) Act that was signed by President Bush on August 9, 2007.

The requirements are in two sections of Title VII which authorizes NSF funding: Section 7008 - Postdoctoral research fellows, and Section 7009 - Responsible conduct of research. Section 8008 of Title VIII - Accountability and transparency of activities authorized by this Act, addresses conflicts of interest in subcontracts. For more information, go to http://science.house.gov/. The full article is available at http://ori.dhhs.gov/documents/newsletters/vol15_no4.pdf.

August 24, 2007

Office of Research Integrity 2006 Annual Report

The Office of Research Integrity (ORI) produces an annual report on possible research misconduct, based on information gathered from 111 institutions. The 2006 report indicates that these institutions were engaged in 73 continuing cases and 86 new cases related to falsification, fabrication, or plagiarism. Details are available in the June ORI Newsletter: http://ori.dhhs.gov/publications/documents/ORINewsletter-7-07-Final.pdf.

July 13, 2007

Export Controls and University Research

Researchers need to be aware of the possibility that federal export control regulations can apply to university research. Willful violations of these regulations can result in prison sentences and large fines.

Normally, university research is excluded from controls under the "fundamental research" rule. However, if you are working with company confidential information, or if your ability to publish results is restricted (other than brief delays to assess patentability), export controls may apply.

In addition, researchers need to be especially careful about taking any confidential information overseas. If the information is subject to controls, it cannot be taken overseas without a license from the federal government. Any laptops taken out of the country should be kept in your possession at all times.

For more information, see "Export Controls and University Research: Basics and Problem Areas," at http://www.research.umn.edu/regulations/export_controls.html, or call Mark Bohnhorst at 612.624.5298.

May 11, 2007

Small Business Subcontracting Plans

The University of Minnesota is required to provide a Small Business Subcontracting Plan (SBP) on federal prime contracts that exceed $500,000.

The Office of Business Community Economic Development maintains a Web site with many listings of small business vendors by business category or by alphabetical order and has a link to the Small Business Administration site. Please note that the vendor needs to be federally certified to count on the SBP on the federal prime contract. For more information, go to http://www.bced.umn.edu/.

For detailed procedures about the entire process, go to http://www.ospa.umn.edu/policiesandprocedures/smallbusinessplans/.

February 9, 2007

Reporting Animal Care Concerns

Animals at the University are counting on all of us to do our jobs humanely and with concern for their well-being. To report a possible violation of the rules involving animal care and use:

• Contact Research Animal Resources (RAR) at 612.624.9100 or e-mail the RAR director at gille002@umn.edu.
• Contact the Institutional Animal Care and Use Committee (IACUC) at 612.626.5654 or keane002@umn.edu . To send an anonymous complaint, go to http://www.research.umn.edu/iacuc/email/anonymous.cfm. 
• Use the Confidential Reporting Service for University of Minnesota at https://secure.ethicspoint.com/domain/en/report_custom.asp?clientid=9167. 
• For husbandry concerns, contact the RAR Facility Supervisor or, if the problem persists, the Area Veterinarian. Contact information is available at http://www.ahc.umn.edu/rar/umnuser/directory.html. If you do not know who to contact, call RAR at 612.624.9100.

January 12, 2007

Encryption Guidelines

Encryption has quickly become a hot topic for University research staff. For researchers storing private data on laptops or other mobile devices, encryption is required by the University's Securing Private Data Standard. Encrypting a hard drive does not need to be complicated, but the benefits, however, are huge.

The University's Office of Information Technology has developed a resource page for faculty and staff who need guidance in encrypting their computers: http://www1.umn.edu/oit/security/Encrypting_Stored_Data.html. Included in this guide are directions for Macintosh users on how to turn on the native encryption on their machines. The University's Securing Private Data Standard is available at http://www1.umn.edu/oit/security/privatedata.html.

December 22, 2006

DHHS Work Plan Focuses on Cost Transfers

Excerpted from the Report on Research Compliance, October 2006 newsletter.

Concerned that the "potential effect of unreasonable, unallocable, or unallowable cost transfers is substantial, considering that the value of National Institutes of Health grants funds awarded each year is approaching $20 billion and increasing," the Department of Health and Human Services Office of Inspector General (OIG) will zero in on cost transfers during fiscal year 2007, according to its new work plan. Other issues to be addressed include whether the Food and Drug Administration properly accounts for the files of human study subjects; whether salary charges to NIH grants accurately reflect the portion of researchers' efforts spent on those grants; and whether colleges and universities have appropriately charged administrative and clerical salaries to federally sponsored grants and cooperative agreements. The work plan is available at http://oig.hhs.gov/publications/docs/workplan/2007/Work%20Plan%202007.pdf.

October 27, 2006

Hazardous Waste Inspection Alert

This message is a reminder to all colleges, departments, and centers with laboratories concerning proper management of chemical waste. The University has been informed that regulatory agencies will be conducting more inspections on the campuses. While we should always be concerned about compliance with disposal regulations, this is a good opportunity for researchers to ensure compliance in their laboratories. Recent inspections have focused on concerns about labeling and storage of waste, particularly the need to keep waste containers closed. The Department of Environmental Health and Safety has summarized what labs need to do to comply. See http://www.dehs.umn.edu/hwd/postcard.pdf.

Departments and PIs should reinforce these efforts and motivate their laboratories in implementing these steps.

September 22, 2006

NSF Audit of Penn Finds Weaknesses in Effort Reporting
Excerpted from the Report on Research Compliance August 2006 Newsletter.

The National Science Foundation (NSF) Office of Inspector General (OIG) recently posted the first in a series of audits of effort reporting, this one at the University of Pennsylvania (Penn). Penn received $29 million in fiscal year (FY) 2004 from NSF; approximately $9.4 million went to research activity salaries and wages. The OIG's objectives were to evaluate the adequacy of Penn's internal controls to ensure that salary and wages were allowable and determine the amount of unallowable salary and wages charged to NSF awards in FY 2002-2004. The OIG randomly selected 46 effort records representing salary and wages charged to NSF awards in FY 2002-2004. The OIG found 23 effort reports without after-the-fact confirmation or determination of whether the reports represented reasonable estimates of actual effort expended; these reports represented $177,894 or 48 percent of the value of the statistical sample. For the full article, go to http://www.oar.umn.edu/RNO_Articles/Report_Rsc_Comp_Penn_Effort.htm.

August 25, 2006

Whistleblower Profile Study

A profile of whistleblowers in Department of Health and Human Services research misconduct cases was presented in a recent Office of Research Integrity Newsletter. Most of the 289 whistleblowers in the 259 closed research misconduct investigations from 1994-2003 were faculty members (57%) rather than administrative or non-faculty members (19%). Eighteen of the 259 investigations involved more than one whistleblower. The results of the investigations were also correlated with the rank of the whistleblower. For the full article, see page nine of the newsletter: http://ori.dhhs.gov/publications/documents/Mar06ORINewsletter.pdf.

July 14, 2006

Research Compliance Runs from Application to Closeout
Excerpted from the Report on Research Compliance June 2006 newsletter.

Department administrators are at the front lines of research administration and are the focus for communication between research and central administration. Central administration implements regulatory requirements, but it is often the department administrator who must translate and impose those requirements on faculty. To read the entire article, go to http://www.oar.umn.edu/RNO_Articles/ReportonResearchCompliance.cfm.

The University's Guide to Research Compliance is available in hard copy and online at http://www.research.umn.edu/complianceguide/index.htm. The Guide assists researchers in the ever-changing world of research compliance. While the main audience is researchers, the Guide is a valuable tool for central units as well.

June 9, 2006

Human Subjects' Research Compliance Program in the Office of Regulatory Affairs (ORA) is responsible for 'for cause' as well as methodically selected audits and review of research studies for compliance to regulations.

• To ensure the safety, rights and well-being of research subjects
• To help ensure the quality and integrity of the research

As a proactive approach we are offering to review studies before research subjects are enrolled. We will review the standard procedures that should be observed for the following:

•  Required training of research staff

•  Documentation of the training of staff authorized to obtain consent from subjects

•  Use of screening log, enrollment log, and signature log

•  Consent process documentation

•  Regulatory binder

•  Study files

•  Procedures to follow to ensure research billing compliance, etc.

If you are interested in having a proactive review of your IRB approved study , please contact the Office of Regulatory Affairs at 612-624-2431 or email: thoma098@umn.edu

ORA website: http://www.research.umn.edu/regaffairs/human/index.html

May 12, 2006

Beyond the A-133 Audit--Expanding the Focus (Part 3 of 3)
Excerpted from the National Council of University Research Administrators (NCURA) April/May 2006 newsletter.

In this last in a series of three articles, the authors address questions auditors are currently asking that expand the audit scope for nonsalary costs. Topics covered include filing and general audit observations.

To read the article, go to http://www.oar.umn.edu/RNO_Articles/NCURA_Article_Part_3_of_3.htm.

April 28, 2006

ROHP Reminder

E-mail notifications will be sent to those enrolled in the Research Occupational Health Program (ROHP) who have not completed their training or medical requirements. Federal regulations mandate that all persons having contact with animals in research be enrolled in an occupational health program. All persons in contact with animals at the University, including those working on IACUC approved protocols, are enrolled in ROHP.

These notifications will specify training and medical requirements for individuals enrolled in the program. Training requirements can be completed online and are self-reported into the ROHP database. Medical requirements are completed in consultation with Boynton Health Service. A new requirement for those enrolled in the program includes a medical questionnaire.

For questions regarding ROHP, please call the Office of Regulatory Affairs at 612.626.3599

March 10, 2006

Grantee Takes Hit for Unallowable Costs of Subaward

In the first 2006 Department of Health and Human Services (DHHS) Office of Inspector General (OIG) audit report, the OIG lived up to its promise to target "subrecipient costs and monitoring." Yale University received a $1.7 million subaward from the University of Massachusetts Medical School (UMMS) under an NIH grant. Between February 2001 and August 2002, the audit found $193,779 in costs that did not comply with OMB Circular A-21 and subaward terms. In addition, the principal investigator failed to provide the 25 percent level of effort proposed in Yale's subaward application.

The OIG recommended Yale, (1) verify that cost transfers are adequately explained and documented, (2) improve procedures for direct charging of costs and comply with procedures for confirming effort reports, and (3) ensure that levels of efforts are satisfied.

Because UMMS-not Yale-was the grantee, the OIG is recommending that UMMS reimburse NIH for the unallowable costs. The complete report is available at www.oig.hhs.gov/oas/reports/region1/10501501.htm.

February 24, 2006

Beyond the A-133 Audit--Expanding the Focus (Part 2 of 3)
Excerpted from the National Council of University Research Administrators (NCURA) Sept/Oct newsletter.

When a sponsor conducts an audit of a specific project, the process can be very different than the usual A-133 audit. Auditors are increasingly going beyond the normal, general financial system requirements and are wanting to validate that there is in-depth understanding and compliance with award terms, on a transaction-by-transaction basis. In the second of three articles, the authors address some of the questions auditors are currently asking that expand the audit scope for non-salary costs. Topics include P-Card use, equipment purchases, consultant and speaker expenses, and cost sharing. To read the article, go to www.oar.umn.edu/NURCA_Article_Part_2.cfm.

January 13, 2006

Another Reason to Protect Confidential Research Data

Researchers may be at risk of unknowingly violating SEC insider-trading laws by sharing or using nonpublic information about their research in connection with the buying or selling of securities. U.S. Senate Finance Committee Chair Chuck Grassley has called for an SEC investigation into whether doctors participating in clinical trials are sharing nonpublic information with stock analysts and investors under consulting arrangements within investment firms in violation of federal insider-trading laws. A new University procedure, Avoiding Conflicts of Interest in Special Situations, makes clear that until the research is completed and the results become publicly available, researchers must be careful to keep preliminary nonpublic research results confidential.

December 9, 2005

Cost Transfer Compliance Audit

The Department of Health and Human Services (DHHS) Inspector General (IG) has been leading a pilot audit at five institutions. Based on initial findings, audits of cost transfers will be expanded beyond the pilot. NIH staff reported, "cost transfer policies tend to be nonexistent, incorrect, or confusing, and the requirements for making appropriate cost transfers are often misunderstood by institutional officials, especially PIs and departmental administrators." Audit results showed systemic noncompliance including delayed cost transfers, lack of justification for the transfer, salary and effort transfers after certification, and reliance on verbal approval from the PI. The University cost transfer policy provides comprehensive guidance on issues concerning this topic.

November 11, 2005

University Creates Guide to Research Compliance

The offices of the Vice President for Research and Institutional Compliance are excited to announce the release of the Guide to Research Compliance.  This guide was created to help researchers manage compliance issues during a research project.

A paper copy of the guide is being distributed to all researchers as part of an ongoing initiative to simplify, streamline, and improve compliance support services at the University.  The guide is also available online at http://www.research.umn.edu/complianceguide/index.htm.

Comments and questions about the guide should be directed through the web site.

October 14 , 2005

Beyond the A-133 Audit--Expanding the Focus

Excerpted from the National Council of University Research Administrators (NCURA) July/Aug newsletter.

Auditors are increasingly reviewing the detail behind the institutional forms or signature requirements and requesting proof of award-specific approvals and procedures that show knowledge of and compliance with the grant terms and condition. Auditors are going beyond the normal, general financial system requirements and are wanting to validate in-depth understanding and compliance with award terms, on a transaction-by-transaction basis.

University research administrators tend to focus on the propriety of the expense. Is the expense allowable and allocable? Does it belong to the grant to which it was charged? If the answer to both of these questions is yes, we assure the principal investigator and university administration that everything will turn out fine. However, that reassurance may be premature.

To read the complete article, go to www.oar.umn.edu/NCURA_Article.cfm.

September 23, 2005

Popular Press Highlights Abuses of Federal Grants

Research programs received a black eye recently when the Wall Street Journal published a front-page feature about misuse of National Institutes of Health (NIH) grant funds. The article highlighted recent settlements of whistleblower lawsuits paid by universities, and charged that the misuse of research funds was the "dirty little secret" of the academic medical research community. The report was republished throughout the country. To view the article go to www.post-gazette.com/pg/05228/554819.stm.

August 26, 2005

Questionable Research Practices Examined

When misbehavior in research is studied, the focus is on falsification, fabrication, and plagiarism (FFP). These behaviors can produce headline-grabbing examples of research misconduct. A recent article in Nature presents the argument that a wider range of questionable behaviors should be examined to ensure the integrity of scientific research. To identify these behaviors, they surveyed early- and mid-career scientists, asking them to self-report how often they had engaged in a list of questionable practices.

The study provides empirical evidence that scientists engage in behaviors with as much potential FFP to damage the integrity of science and scholarship. The authors also call for an examination of the entire research environment to identify the institutional and structural systems that foster these behaviors. The full article can be found at www.nature.com/nature/journal/v435/n7043/full/435737a.html.

August 12, 2005

NSF Summer Salary Rules Must be Followed on CPS Statements

In reports to Congress, NSF's Inspector General has noted that NSF relies on accurate statements of Current and Pending Support (CPS) in NSF grant applications and that misstatements about CPS can lead to Office of Inspector General (OIG) investigations.

Information in the CPS section of grant proposals should reflect all current and pending support for all sponsors (including NSF) for both ongoing and proposed projects. Long-standing NSF instructions direct that all effort to be "devoted" to the project must be listed. For currently-funded projects, that means the full amount of funded summer salary must be listed on the CPS. For proposed projects, the effort proposed must be listed. In addition, all committed effort must be shown, regardless of whether funding is received for that effort.

If an individual has multiple NSF grants with summer salary support, the total support of person-months for awards and pending proposals may not exceed two-ninths of his or her regular academic-year salary. If a PI with two months of NSF summer salary support wishes to submit a proposal for additional summer support, the PI must list the currently funded support on the CPS and should identify in the proposal the reductions in the currently funded support that will be requested in the event the new proposal is awarded.

The NSF CPS instructions are consistent with the NSF budget instructions, which are quite clear that NSF will not provide funding for more than two months of summer salary for a given year.

July 8, 2005

NSF Audit Shows Importance of Cost-Share Documentation

An audit published by the NSF Office of the Inspector General (OIG) (excerpted here from Report on Research Compliance , March 2005) highlighted the challenges of documenting cost sharing applied to NSF awards. The principal investigator on the audited award did not have adequate documentation to track institutional cost share or to monitor the sub-recipient cost share. Initially, $526,000 of cost sharing was questioned by the NSF. Ultimately, $302,483 in cost share charges were denied by NSF resulting in an award reduction of $195,133.

Summary findings included:

• Two sub-recipients did not meet committed cost share obligations;
• Third party cost share was inadequately documented;
• One employee charged 100% of his salary as cost share on the grant when he was only authorized to work 75% on the grant;
• Documentation of consultant fees of $35,000 did not substantiate how the work benefited the award.

To read the OIG audit report, go to www.nsf.gov/oig/STCC_05-01-002_final.pdf.

For information on cost share "Best Practices," go to process.umn.edu/groups/controller/documents/information/sponsored_reporting_proc.cfm or contact SFR at 612.624.4313.

June 24, 2005

Research Compliance Program 

The Research Compliance Program in the Office of Regulatory Affairs (ORA) is responsible for audits of research studies involving human subjects under the purview of the University of Minnesota Institutional Review Board (IRB). The overall purpose of the Research Compliance Program is to:

• Ensure the safety, rights, and well-being of research subjects;
• Help ensure the quality and integrity of research.

Research studies are audited based on requests from the IRB, for cause requests, or the risk category, and the audits ensure compliance with federal, state, local, and institutional regulations and guidelines.

The Research Compliance Program is also responsible for the registration and oversight of studies involving human embryos or embryonic stem cell lines ineligible for federal or state funding. These research studies can begin only after registering with ORA. Prior to registration such studies must have IRB approval, follow necessary accounting standards, and use only private funding as per Academic/Administrative Policy 2.1.11. For more information on the Research Compliance Program, go to www.research.umn.edu/regaffairs/human/index.html.  Questions about the Research Compliance Program may be sent to ORA at ora@umn.edu.

June 10, 2005

Mayo Pays $6.5 Million to Settle Allegations of Grant Fraud 

The Mayo Foundation, parent organization of the Mayo Clinic, has paid $6.5 million to the Federal Government to resolve allegations that it misspent millions of dollars in federal research grants.

The Justice Department said Mayo had routinely transferred money from one grant to another to pay for unauthorized expenses and tried to hide the transactions from the agencies that paid the bills. The investigation showed not only improperly transferred expenses, but also that Mayo had an accounting system unable to monitor and manage charges made to federal grants in a manner required by federal law.

"All recipients of federal grant money must comply with the restrictions placed on the use of that grant money,' said Peter Keisler, the Assistant Attorney General for the Civil Division of the Department of Justice. "[The] settlement demonstrates our commitment to vigorously pursue allegations of fraud and abuse in federal grant programs."

The Department of Justice press release: http://www.usdoj.gov/opa/pr/2005/May/05_civ_292.htm

May 27, 2005

Former GWU Professor Pleads Guilty to Embezzling

In April 2005, a former tenured professor of engineering at George Washington University (GWU) pled guilty to embezzling nearly $1 million in federal grant funds. Nabih E. Bedewi admitted to directing much of the money to his own private companies.

Mr. Bedewi, principal investigator on cooperative agreements with the U.S. Department of Transportation, admitted that he caused to be submitted and approved for payment fraudulently-inflated invoices and used an alias to help him direct hundreds of thousands of dollars into companies he owned or in which he had substantial interest.

To read the press release on this case from the U.S. Department of Justice, go to www.usdoj.gov/usao/dc/Press_Releases/2005_Archives/Apr_2005/05120.htm.

May 13, 2005

Compliance issues noted by the Department of Audits

Recent compliance issues involving sponsored projects include:

• Monitoring committed effort levels for compliance with the terms of the grant/contract.
• Establishing a process to ensure all researchers certify effort on each project.
• Ensuring all required employees file REPA and ROC forms.
• Reviewing expenditures for allowability, allocability, appropriateness, authorization, and proper justification.
• Establishing procedures to ensure all extensions, re-budgeting, and changes in principal investigators, key personnel, committed effort level, and workscope are approved by the sponsor when required.
• Documenting all committed cost sharing and matching funds expenditures.
• Monitoring of technical report deadlines to ensure timely submissions.
• Monitoring fixed price contracts to ensure expenses are charged appropriately, deficits addressed, and accounts are closed on a timely basis.

Additional compliance issues and other recent Department of Audits findings are found at http://www.umn.edu/audit/MostCommonFindings.htm

April 22, 2005

Research Occupational Health Program

The Office of Regulatory Affairs has launched a new Web-based reporting system for tracking medical and training requirements for the Research Occupational Health Program (ROHP).

Federal Regulations mandate that all persons having contact with animals in research be enrolled in an occupational health program. The University of Minnesota 's ROHP consists of two major components - a training component and a medical component.

The training component involves web-based self education on various hazards that may be associated with animal use in research. The content is based on the particular species of animal or other risk factors involved in individual research projects. Once the material is reviewed, the training is self reported through the ROHP system. As IACUC protocols are submitted, individuals will be notified by email regarding which parts of the training they need to complete. The medical component of ROHP is conducted by Boynton Health Service. Individuals, again, will be notified regarding which medical requirements need to be completed and will consult with a health care provider at Boynton.

Contact the Office of Regulatory Affairs with questions about ROHP, 612-626-3599.

April 8, 2005

NIH Issues New Animal Welfare Guidance

The National Institutes of Health's Office of Laboratory Animal Welfare and the Office of Extramural Research issued new guidance on prompt reporting requirements for its public health service policy on humane care and use of laboratory animals. The new guidance is intended to assist with determining what, when, and how situations should be reported and to promote greater uniformity in reporting.

To review the NIH Notice, visit: http://grants.nih.gov/grants/guide/notice-files/NOT-OD-05-034.html

March 25, 2005

How to Protect Against Research Misconduct in Labs

The following guidance is excerpted from a presentation by Alan Price, Ph.D., Associate Director for Investigative Oversight, Office of Research Integrity, given at the March 9 conference, "Promoting an Ethical Research Culture:"

• Look carefully at raw data from coworkers (postdocs, students and technicians)
• Take seriously the concerns about data, or actual allegations, from staff
• Be careful how you resolve disputes or breakup with former collaborators
• If you find evidence of misconduct in your lab, report it and remove yourself
• If you suspect misconduct, inform officials. Do not try to entrap the person you suspect
• Do good science, be a good mentor, and show direct interest in your students' work
• Take responsibility for your lab's research

For questions about the conference or ethical research at the U of M, contact Carol Foth at rcr@umn.edu.

March 11, 2005

NSF Audit Reveals PIs do not Submit Timely Annual & Final Reports 

In a recent audit, the NSF Inspector General (OIG) found that 47 percent of all final and annual reports required over the past five years were submitted late or not at all. The audit also revealed a number of principal investigators (PIs) received new awards before NSF had received or approved reports on previous grants.

The OIG urged NSF to develop an automated reminder for PIs when reports are due and overdue, and to clarify the responsibilities of NSF and recipient institutions to ensure timely reports. The audit also recommended developing policies governing when a PI can receive a new grant without submitting a final report on a previous one.

In response, NSF asserted that development of a comprehensive report tracking system is underway. The response letter said NSF is considering a system that would prevent any awards from being made to PIs who have overdue annual or final project reports.  The OIG audit report and NSF response are available at www.nsf.gov/oig/05-2-006Final.pdf.

February 25, 2005

Biosafety Compliance Information

Environmental Health and Safety uses a monthly electronic mailing, BioBasics On-Line , to keep researchers informed about biosafety compliance issues and biosafety updates to the Institutional Biosafety Committee (IBC) web site. To subscribe to BioBasics On-Line , e-mail charb002@umn.edu.

The IBC web site is the University of Minnesota's primary source of information for biosafety compliance, http://www.ibc.umn.edu/ . All safety guidelines outlined in the CDC/NIH publication Biosafety in Microbiological and Biomedical Laboratories (BMBL) 4th Edition and the NIH Guidelines for Research Involving Recombinant DNA Molecules must be followed. In addition, University specific procedures are found in the Biosafety Principles and Practices section of the IBC web site. Fact sheets designed for use as training tools are added to the web site on a regular basis. Fact sheets can be accessed at, http://www.ibc.umn.edu/factsheets.html .  Questions about this article should be directed to Darlene Charboneau, Environmental Health & Safety, charb002@umn.edu.

February 11, 2005

Animal Use Protocol Transfers  

All vertebrate animal use must be pre-approved by the Institutional Animal Care and Use Committee, IACUC. Each Animal Usage Form submitted receives a unique protocol number. Whenever an animal needs to be transferred (change PI, move from a breeding to a research/teaching protocol, renew an expiring protocol, etc.) a transfer form must be completed and submitted to RAR to officially track the animals and their approved use.

Frequently when a protocol is renewed, it is assumed that animals housed under the old or expired protocol will be automatically transferred to the renewal protocol-- that is not the case. Investigators must submit a protocol transfer to have animals placed onto new protocols. In addition, the renewal protocol must have animal numbers listed in the Transferred column on the Animal Request Table. Otherwise, the animals transferred from the expiring protocol will be deducted from the number of animals approved for purchase.  Contact Cynthia Gillett at gille002@umn.edu with questions about this article.

January 28, 2005

Patent Office Publishes CREATE Act Regulations  

On January 11 th , the U.S. Patent and Trademark Office published an interim rule implementing the Cooperative Research and Technology Enhancement Act of 2004 (CREATE Act). The act was passed by Congress to encourage collaboration among researchers.  

A recent lawsuit had a chilling effect on collaboration by establishing that patent rights were lost when two scientists shared their work in the process of research. The new act will establish procedures for creating joint research agreements that will allow collaboration to continue while individuals retain patent rights to the inventions that flow from that collaboration. To review the regulations, visit: http://www.regulations.gov/freddocs/05-00461.htm

January 14, 2005

Yale Forces Out Tenured Professor Accused of Financial Misconduct

Excerpted from The Chronicle of Higher Education, Jan 11, 2005.

A tenured professor at Yale University 's School of Management has lost his job because of alleged indiscretions with university funds. Florencio López-de-Silanes, director of the Yale's International Institute for Corporate Governance, had allegedly padded his business-travel expenses by about $150,000 since he was recruited to Yale in 2001.

Mr. López-de-Silanes has made full restitution to the university and, in a written statement admitted his error without going into detail. "I made a mistake, and I deeply regret any unintended harm," he wrote in a message issued by his lawyer. "I am leaving Yale because it is the right thing to do for the institute and all concerned." López-de-Silanes did not take any steps to retain tenure. In his research and writing, López-de-Silanes advocated for mandatory disclosure rules and civil lawsuits as a means of keeping corporate executives honest.   A university spokesman confirmed the general reasons behind Mr. López-de-Silanes's departure saying "He has resigned from Yale as a result of financial misconduct and irregularities. Appropriate actions have been taken." The spokesman reported further that Yale is undertaking an audit of its expense procedures. He said the audit would not be limited in focus to any one of the university's schools and he declined to comment on whether the audit was a response to this case.

December 10, 2004

UC Berkeley Computer System Hacked, Records Accessed 

In October, someone improperly accessed a database of names and Social Security numbers of about 1.4 million California residents that was stored in a computer system at the University of California, Berkeley.  Reuters reports that school officials and the FBI are trying to determine whether the hacker obtained personal information for illegal uses.  The names accessed by the hacker were being used by a  UC Berkeley researcher who had collected data on elderly people and individuals who provide in-home care to seniors to study the impact of wages on in-home care. Read more about this story at http://www.informationweek.com/story/showArticle.jhtml?articleID=50900249  

Questions about this article should be directed to Susan McKinney, CRM, director, Records & Information Management at mckin018@umn.edu.

November 12, 2004

Recent HHS OIG Audits show vulnerable areas in Federal Award Management  

The Department of Health and Human Services' (HHS) OIG recently released two audit reports of universities that reveal troublesome vulnerabilities regarding fundamental award administration practices.  Two vulnerabilities emerged as the chief reasons why federal auditors issued findings:

1) Improper design and implementation of institutional policies related to employee time- and effort-reporting that comply with OMB Circular A-21, Cost Principles for Educational Institutions, and

2) Failure to create clear lines of authority and responsibility when collaborative arrangements (such as subgrants and subcontracts) are involved.

Additionally, a considerable amount of the questioned costs involved the fact that, at the time of the audit, documentation was inadequate to allow a determination as to allowability.   These findings surfaced because the institution had either a poorly designed policy or procedure, or experienced significant failure of the persons working on the projects to adhere to a policy or procedure that would have prevented violations of federal rules.    Both OIG audit reports are posed on the OIG Web site, www.oig.hhs.gov/w-new.html .  

Questions about the content of this article should be directed to Sue Paulson at spaul@umn.edu

October 22, 2004

Program Income Article

Win Ann Schumi, Assistant Vice President for Research, recently authored another article for the National Council of University Research Administrators (NCURA) Newsletter. The article, titled "Program Income - An Interesting Topic in Grants Management," may be found on pages 9 and 10 of the newsletter, available at www.ncura.edu/data/newsroom/newsletters/pdf/septoct04.pdf

October 8, 2004

OIG Disallows $500,000 in Costs, Challenges Additional $1.7 Million

The Department Health and Human Service's Office of Inspector General (OIG) recommended in an audit report that East Carolina University repay $565,820 to the National Library of Medicine (NLM) for unallowable costs it charged to a $4.5 million contract received from NLM. Another $1.7 million of charges to the contract were not sufficiently documented and must be examined to determine disallowances. Over 57 percent of the costs claimed for this project were recommended for financial adjustment.

The audit report states that the NLM contract was regularly charged for unallowable costs. For example:

• The contract was charged for the salaries and fringe benefits of employees who had been instructed to falsely certify effort even though they were not actually working on the project.
• The contract was charged for equipment that was not and would not ever be used for the project.
• The contract was charged for payments to firms with business relationships with the former Co-PI, even though the services were either not rendered or not related to the contract.
• The contract was charged for the salaries and fringe benefits of administrative personnel whose duties did not apply directly to the project.

The report is available at http://oig.hhs.gov/oas/reports/region4/40401001.pdf.

September 10, 2004

NCURA Article on Compliance at the U 

Win Ann Schumi, Assistant Vice President for Research, and Tom Schumacher, Director of Institutional Compliance, recently authored an article for the National Council of University Research Administrators (NCURA) Newsletter.  The article, titled "Growing a Culture of Compliance at the University of Minnesota," may be found on pages 6 through 8 at this link:

http://www.ncura.edu/data/newsroom/newsletters/pdf/julyaugust04.pdf.

July 9, 2004

New Policy on Clinical Trials and Other Fixed Price Contracts

Effective July 1st, the University of Minnesota has implemented a new policy titled "Handling Clinical Trials and Other Fixed Price Contracts." The policy was developed because these types of performance-based awards are often financed differently from other kinds of research agreements. As a result, Sponsored Projects Administration and Sponsored Financial Reporting have developed new processes and oversight mechanisms to meet the unique compliance needs of these types of projects.

The policy and the procedure, titled "Handling Industry-Sponsored Clinical Trial Research Agreements," are focused on industry-sponsored clinical trials. Procedures for handling other types of fixed-price agreements may be added at a later date. The new policy is found in the UWide Policy Library at http://www.fpd.finop.umn.edu/groups/ppd/documents/policy/clinical_trials_pol.cfm

June 25, 2004

Revised Cost Transfer Procedure 

Sponsored Projects Administration (SPA) and Accounting Services have revised the cost transfer procedure. The most significant change relates to processing an IX that debits multiple sponsored accounts. Effective immediately, the certified approver from each department debited on the document must approve it. SPA and Accounting Services made this change so that project staff will be informed when their accounts are being debited.  The procedure, Adjusting or Correcting Internal Accounting Transactions for Sponsored Accounts (3.2.4.3), can be found at http://www.fpd.finop.umn.edu/groups/ppd/documents/procedure/adjusting_or_correcting_spon.cfm

June 11, 2004

HHS Audit Faults Effort Reporting Documentation

The Department of Health and Human Services Office of Inspector General (OIG) published an audit in April that highlights the importance of making sure we follow our own University of Minnesota policies and procedures with regard to effort reporting. The OIG visited Northeastern University to assess expenditures charged to a NIH grant totaling $525,188 over a seven-year period. At the end of the review, the OIG audit declared that $61,215 in salaries, fringe benefits, and related indirect costs were not adequately documented and recommended the institution return the funds.

While the OIG audit did not contend that money was inappropriately spent, it found that the university had not maintained adequate documentation required by its own policies and procedures, and therefore could not support the salaries charged to the grant. The OIG audit may be found at http://oig.hhs.gov/oas/reports/region1/10301502.htm.

May 14, 2004

Records Retention Policy Updated 

University of Minnesota Policy 3.9.1, Managing University Records Retention, was recently updated by bringing the U-Wide Records Retention Schedule up-to-date and by adding an appendix titled "General Retention Guidelines for Financial Documents." The updated policy is available at http://www.fpd.finop.umn.edu/groups/ppd/documents/policy/record_retention.cfm.

The retention schedule applies to all University departments, units, and agencies. In addition, this retention schedule applies to all formats of information, including but not limited to, hard copy paper records, electronic media, and microforms. Departments and units are encouraged to use electronic formats to manage and store their information. Electronic records must be maintained and accessible according to the retention schedule and destroyed when the retention period for that format has been met. Electronic records, such as word processing documents, may be destroyed if a paper copy has been made and filed in the unit's record keeping system.

For more information, contact Susan McKinney, CRM, at 612.625.3497 or susanmckinney@mail.ogc.umn.edu

April 23, 2004

Compliance Advice for Cost Sharing the NSF Way

During a recent satellite conference, the head of NSF's Policy Office of the Division of Grants and Agreements, Jean Feldman, addressed head-on the controversial question of cost sharing. The National Council of University Research Administrators (NCURA) sponsored the event, titled "Cost Sharing Management". "If a program solicitation does not specify that we include cost sharing, then eliminate it from the budget," Feldman said. "If a percentage is established, we mean no more or less." Cost sharing represents a compliance challenge and financial burden to the institution. According to Feldman, it is a misconception that cost sharing improves the likelihood of being funded by the NSF. Reviewers will know about cost sharing requirements but will not see the amounts specified in proposal budgets.

March 26, 2004

Nonfederal Sponsors Impose New Restrictions on Funding

This article is excerpted from the Federal Grants News for Colleges and Universities, March 2004 issue.  Two large sponsors of university research and other sponsored activities recently announced changes in their grants policies that could affect whether institutions or individual investigators will be eligible to receive funding from these organizations. These funding restrictions raise the concern that other sponsors may limit their research support of investigators over certain issues.

• The Ford Foundation has informed its grantees about the changes in a memo dated January 8, 2004. To monitor it's grantees, the Foundation is expanding its oversight and monitoring and has added this audit language to the grant agreement letter: "The Foundation is authorized to conduct audits, including on-site audits, at any time during the term of the grant, and within four years after the completion of the grant." To read the entire memo, go to http://www.fordfound.org/about/docs/ff_grantee_memo.pdf.
• The American Cancer Society (ACS) has issued a new policy prohibiting any individual investigator who receives funds from tobacco companies from receiving ACS funding as well. The ACS Research Program Web site is located at http://www.cancer.org/docroot/RES/RES_0.asp.