The federal government awards tens of billions of dollars each year in research and development (“R&D”) grants. Recipients include universities, nonprofit research institutions, and local government agencies. While most of these entities are honest and provide the American people with crucial information and technology, others obtain grant money based on false data and false statements about research conditions.

A whistleblower, typically a researcher or other employee of the research institution, can help the government recover money from an ill-gotten grant, which ultimately benefits American taxpayers and citizens. The federal False Claims Act provides for significant financial rewards to whistleblowers who follow the right steps in reporting fraud and help in successful litigation.

What is grant fraud?

While the term “fraud” technically applies to a relatively narrow range of illegal activities, we use the term “grant fraud” here to refer to any grant-related activity that violates the federal False Claims Act (“FCA”)1 and/or comparable state laws. These laws are violated when the government awards grant money based on false information that a researcher or research institution provides in connection with the grant, whether or not the grantee intends to defraud the government. This false information may be included on the initial application for the grant, in the publication of research conducted with the grant, or in reports that the grant recipient is required to make as a condition of the grant.

What are examples of grant fraud?

Examples of grant fraud and alleged grant fraud include:

  • Misrepresenting the conditions under which grant-funded research is conducted.

Researchers at an Ivy League university submitted false claims for reimbursement under more than 400 various research grants by misrepresenting the nature of the buildings where the research was conducted.2 The university paid $9.5 million to resolve the related FCA lawsuit.

  • Fabricating results in healthcare studies.

A private university in North Carolina agreed in 2019 to pay the federal government $112.5 million to resolve allegations that two researchers fabricated data in connection with at least thirty grants for health research between 2006 and 2018.3

  • Receiving federal research grants while recklessly or intentionally failing to disclose funding by a foreign government.

A Michigan biomedical research institute recently paid $5.5 million to settle allegations that two of its researchers were funded by the Chinese government.4

  • Misappropriating grant money.

A biomedical research institute based in San Diego agreed to pay $10 million to settle FCA allegations that it charged grant funds for the time that its researchers spent teaching and conducting administrative activities rather than conducting research for a wide range of federal grants.5

What government agencies lose the most money to grant fraud?

The federal government does not publish estimates of grant fraud losses by agency. However, the Department of Defense (“DoD”) and the Department of Health and Human Resources (“DHHS”) are believed to lose the most. This is partly because their budgets are among the largest for federal agencies and because they rely heavily on the private sector for research.

DoD spends hundreds of billions of dollars on defense contracting each year and distributes tens of billions of dollars annually in research grants. Defense contractors and research institutions alike are frequently named in FCA lawsuits, and frequently settle litigation or face judgments for tens or even hundreds of millions of dollars.

DHHS is believed to lose several billion dollars each year to Medicare and Medicaid fraud. DHHS also distributes tens of billions of dollars in research grants each year through the National Institutes of Health (“NIH”) alone. FCA lawsuits frequently target researchers who misrepresent information related to their research.

The Environmental Protection Agency (“EPA”) is another federal agency that relies on private-sector research and sometimes loses money to grant fraud.

Can grant money for one research project be used for other research projects?

Generally, no. The purposes for which grant money can be spent are typically outlined in documents associated with the grant. A rule of thumb for a research institution (or any other contractor) wanting to avoid FCA liability is “Disclose, disclose, disclose.”

Can research grant money go towards personal expenses?

No. Such a use of federal funds is typically considered an FCA violation.

What happens if a research institution lies on a grant application?

Like any person or entity that receives federal funds, a research institution is subject to FCA liability for a false statement made in connection with a grant, if the false statement potentially made a difference in obtaining the grant. For purposes of FCA liability, the false statement need not be intentional or aimed specifically at defrauding the government; it can also be a “reckless” false statement. Recklessness can take many forms, including the ignoring of repeated warnings that a statement may be false.6

FCA liability can be stiff: In a successful FCA lawsuit, the government’s total recovery typically includes three times the amount of the overcharging or fraud, plus civil penalties of $11,665 to $23,331 for each false claim for payment.7 Verdicts and settlements involving research institutions can frequently stretch into the seven- and even eight-figure range.

In cases initiated by a “qui tam” whistleblower, the whistleblower is entitled to 15% to 30% of the government’s recovery, subject to court approval, depending on the extent of the whistleblower’s involvement in the case.8


Suspect Research Grant Fraud? Let’s Talk.

With hundreds of billions of R&D dollars at stake, it can be very difficult to monitor improprieties among researchers who play fast and loose with government funds. That is why the government relies on courageous whistleblowers to try to help stem the rising tide of fraud. While the federal government recovered $24.8 billion between 2011 and 2020 through FCA lawsuits – including $21.9 billion in lawsuits initiated by whistleblowers9 – the vast majority of false claims is believed to go undetected. The federal government is estimated to have made $144 billion in “improper payments” in fiscal 2016 alone.10 That amount includes payments based on false claims as well as those made on mistakes and for other reasons.

If you suspect fraud against the federal or state government, let’s talk. We are here to help put you at ease as we try to help you determine — confidentially and discreetly — if you should move forward with a whistleblower/qui tam claim. We appreciate the struggle you may be facing. That is why we have a You-First policy in place. We will try to help protect you regardless of your involvement.

Contact us or call 1-844-520-2889.

If we decide to take your case and you don’t get a reward for reporting fraud, you owe us nothing.

1 See 31 U.S.C. § 3729 et seq.

2 Compl.-in-Intervention of the United States ¶¶ 1, 7, 1023, United States ex rel. John Doe v. Columbia Univ. (S.D. N.Y. July 25, 2016), ECF No. 16, available at; Manhattan U.S. Attorney Announces $9.5 Million Settlement With Columbia University For Improperly Seeking Excessive Cost Recoveries In Connection With Federal Research Grants, U.S. Dep’t Just. (July 24, 2016),

3 Duke University Agrees to Pay U.S. $112.5 Million to Settle False Claims Act Allegations Related to Scientific Research Misconduct, U.S. Dep’t Just. (Mar. 25, 2019),; Am. Compl. ¶¶ 14760, United States ex rel. Thomas v. Duke University, 1:17-cv-276 (M.D.N.C. Nov. 13, 2015), ECF No. 25; Stip. Of Dismissal, United States ex rel. Thomas v. Duke University, 1:17-cv-276 (M.D.N.C. July 8, 2019), ECF No 298;

4 Department Of Justice Reaches $5.5 Million Settlement With Van Andel Research Institute To Resolve Allegations Of Undisclosed Chinese Grants To Two Researchers, U.S. Dep’t Just. (Dec. 19, 2019),

5 The Scripps Research Institute To Pay $10 Million To Settle False Claims Act Allegations Related To Mischarging NIH-Sponsored Research Grants, U.S. Dep’t Just. (Sept. 11, 2020),

6 United States v. Outreach Diagnostic Clinic LLP, 12-CV-0480, 2020 WL 1272609, at *4 (S.D. Tex. Mar. 16, 2020).

7 31 U.S.C. § 3729(a)(1)(G); Fed. Civ. Penalties Inflation Adj. Act of 1990, PL 101–410, October 5, 1990, 104 Stat 890 §§ 45; 28 C.F.R. § 85.5.

8 See 31 U.S.C. § 3730(a), (b), and (d).

9 See United States Dep’t of Justice, Fraud Statistics – overview, October 1, 1986 – September 30, 2020 (Jan. 14, 2021),

10 Government Efficiency and Effectiveness: Opportunities to Address Pervasive Management Risks and Challenges while Reducing Federal Costs, Gov’t Accountability Ofc. (May 17, 2017),

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