March 19, 2012
Francis S. Collins, M.D., Ph.D.
Director
National Institutes of Health (NIH)
Bethesda, MD 20814
Dear Dr. Collins:
I am Nurit Kalderon, Ph.D., a neuroscientist and the principal investigator on an NIH grant, R01 NS039375, titled "Pre-Clinical Studies of Spinal Cord Injury Repair," am holding a related US Patent, and am also, under duress since March 2006, a whistleblower.
A major concern here is the disturbing discovery of betrayal of the American public trust and of the disregard and violation of Congress' NIH Reform Act of 2006 by the Director of NIH. Specifically, the mandatory annual reports about each of the pending whistleblower complaints of fraud and abuse of NIH funds that were generated and submitted by the NIH Director to Congress —in accordance with the NIH Reform Act of 2006— have been misleading and downright deceitful.
The Director's reports to Congress for the years 2007–2009 [1] flagrantly and illicitly concealed my whistleblower complaints about: the financial fraud, misuse and embezzling of my NIH grant funds; the illicit handling of and deliberate injury to my intellectual property in discontinuing the funded research project; and the subsequent corruption, abuse of power and obstruction of due process perpetrated in covering up these outrageous activities.
I am writing to bring to your attention to a specific corrupt group of NIH financial administrators —disbursing officers of extramural grant awards— that operates within the Grant Management Branch (GMB) at the National Institute of Neurological Disorders and Stroke (NINDS), and to their organized financial fraud schemes.
The record shows that the GMB/NINDS leadership has no interest in supporting the NIH biomedical research mission. Instead, the primary objective of these administrators is to divert NIH research grant funds, through illicit activities, from the funded research projects into their personal enterprises. The cover-up of these illicit transactions —with the knowledge and the extensive support network provided by the upper echelon at the Director's Office— is achieved by issuing false notices of award and maintaining fraudulent bookkeeping. Altogether, these administrators have blood on their hands; having discontinued the funded research, each one of them is personally accountable to the spinal cord injured individuals who have been deprived by their actions of a promising cure.
The details of the illicit activities of this group and their collaborators with respect to my grant, funded research project and whistleblower complaints are given in the Addendum [1] which is attached to this letter. The following is a brief summary of these:
- The Financial Fraud. The embezzlement of my grant funds in the sum of $203,132.00 and mishandling of the related research project started in April 2006 —when the grant was in transition between grantee institutions. Three administrators unlawfully discontinued and closed out the funded research project; misled and misrepresented the nature of their financial transactions; refused to communicate with me, the principal investigator; and siphoned all of the unobligated grant funds into their personal enterprises.
- The Cover-Up of the Fraud. These illicit activities were covered up by maintaining fraudulent bookkeeping; by issuing in the period June 28, 2006, through July 23, 2008, false and deceitful notices of award including defamatory inferences about me, falsely suggesting that I, the principal investigator, had abandoned the research project, leading thereby to the inevitable closeout of the project; and by refusing to provide me with financial records and related e‑communication as required by law.
- Abuse of Power by the NIH Legal Advisor Office. In April 2007 non-party subpoenas were served on some of the NINDS administrators —in connection with a lawsuit under the False Claims Act against grantee institution— for document production related to my grant starting from November 2005 to the present. The NIH Deputy Legal Advisor, Ms. Patricia Kvochak (Kvochak), handled the subpoenas. The requested documents were never produced, either under subpoena, the Freedom of Information Act (FOIA) and/or the Privacy Act. Instead Kvochak, 'under color of law' and abuse of authority, used the served subpoenas as a license to monopolize the handling of the grant and the related research project, illegally impersonating a GMB/NINDS official, a NIH Compliance and Oversight Officer, and a System Manager of the extramural research grants. Kvochak gained illicit access to my confidential and privileged grant file documents, thereby violating the Trade Secrets Act and the Privacy Act. Further, Kvochak illicitly copied and still maintains a complete folder of these documents —including the grant proposal, salary information, study section review— in the Office of the General Counsel.
- Derailment of the Compliance Division Actions to Reinstate the Grant & Project. In the period June 2007 through March 2008 the Grants Compliance and Oversight Division (Compliance Div.) at the Office of Policy and Extramural Administration (OPERA) moved [2] to reinstate the funded research project and the grant at New York University (NYU), which was ready to accept the grant and project as early as March 2007. However, because the funds were already diverted and depleted in June 2006, these corrective actions were obstructed and derailed under the leadership of the Deputy NIH Legal Advisor. Kvochak and the Chief GMB/NINDS, Ms. Tijuanna DeCoster (DeCoster), targeted and systematically harassed and intimidated the officials at NYU, in particular the Director of the Center of Neural Science, Dr. Tony Movshon, by submitting a defamatory and stigmatizing Questionnaire. Consequently, by March 2008 NYU retracted its commitment to sponsored my grant and research project.
- Cover-Up of the Complaints and Retaliation Against the Whistleblower. In parallel, the financial administrators conducted a campaign of retaliation against the whistleblower, employing intimidation and defamation of the whistleblower and obstruction of the administration of justice as required under the Privacy Act. The retaliation efforts were accompanied by the cover-up of the complaints, instigated and executed [3] by Kvochak in cooperation with the NIH the Senior Privacy Act Officer, Ms. Karen Plá (Plá), with the knowledge and approval of the Director of the NIH Office of Policy for Extramural Research Administration (OPERA), Mr. Joe Ellis (Ellis), and the NIH Legal Advisor, Ms. Barbara McGarey (McGarey).
I would like to emphasize that the omissions and deceit in the Director’s Reports were not due to mere human error or malfeasance of a straying individual but rather a deliberate and calculated cover-up of the whistleblower complaints that was made with the knowledge, approval and/or acquiescence of the upper echelons at the Office of the Director including: the Director of OPERA, Ellis, the NIH Legal Advisor, McGarey, the Director of the Division of Program Integrity, Ms. Maritza E. Zeiberg, and the Director of Division of Management Support, Ms. Katy Perry, both of the NIH Office of Management Assessment. In fact, in November 2007 one of the complaints was also brought to the attention of the NIH Director at the time, Dr. Elias Zerhouni, by the whistleblower.
Due to the actions of the above-mentioned corrupt NIH administrators I am currently unemployed and unemployable, am, since March 2006, prevented from accessing my grant funds and from performing my funded research project, and am permanently deprived from receiving federal grants and reinstating my laboratory and research to cure paralysis due to spinal cord injury.
Finally, to add insult to injury, not only did this corrupt group NIH financial administrators embezzle public funds dedicated to developing a cure for spinal cord injury, lie to and deceive Congress and the American public, they also lied to the Courts with the help and knowledge of the Justice Department. On November 3, 2008 I filed a complaint [4] in federal court against these corrupt financial administrators and their collaborators for violating my constitutional and civil rights and several provisions of the Privacy Act. In June 2009 these individuals moved to dismiss my complaint, and in support of their motion they submitted several declarations that are false and fraudulent. Currently, the case is pending appeal [3] at the US Court of Appeals, 2nd Circuit.
It is time you stop the embezzlement of public funds, stop the deception and eradicate the organized illicit enterprise at the NIH. I am requesting the following actions towards reinstating integrity at the NIH:
- The NIH Director should provide full transparency of the NIH actions in relation to my grant by producing a complete record of the subject grant —as previously requested by me in accordance with FOIA and the Privacy Act of 1974 and never provided. (Details are provided in the Addendum [1] Exhibit I). This information will be placed by me at http//:www.whistleblowing-nih-financial-fraud.org to inform the American public about the misuse of their tax dollars by the NIH.
- Command the correction of the fraudulent and false Notices of Grant Award and related relinquishing statements, by expunging, annulling and/or issuing new truthful documents. (Details are provided in the Addendum [1] Exhibit I.)
- The NIH Director should issue an apology letter to NYU officials and to Dr. Tony Movshon with respect to the illicit Questionnaire and the harassment and coercion they were subjected to at the hands of Kvochak and DeCoster.
- The NIH Director should issue a letter to the Court [5] in the form of Amicus brief, serving as amicus curiae informing the truth about defendants [6] actions. Specifically, detailing the fraud and abuse related to my grant and funded project that was perpetrated by each of the defendants and the abuse of power, retaliatory actions, and defamation against me, the principal investigator, performed by each of the defendants.
General Suggestions for Providing Transparency:
- The Director's annual report about whistleblower complaints should be more detailed, providing specific information about the complaints and their resolution, and published at the NIH website.
- The Chapters of the NIH Policy Manual which deal with various aspects of grant administration, numbers 4204- through 55808-, and which are posted at http://www1.od.nih.gov/oma/manualchapters/scripts/mcs/browse.asp but restricted/blocked to public access should be made available to public access.
With due respect, establishing full transparency is the most crucial and decisive step towards restoring integrity at the NIH; therefore, the Director should fulfill this duty within a time-frame of a few days. Once full transparency of the NIH actions in relation to my grant is established —by producing a complete record of the subject grant within a few days— eradicating the corrupt elements/actors from the system and restoring integrity and accountability becomes a trivial matter.
Sincerely,
Nurit Kalderon, Ph.D.
Principal Investigator, NIH R01NS039375 grant
Kalderon@whistleblowing-nih-financial-fraud.org
cc:
Levinson Dan, Inspector General HHS
Kathleen Sebelius, Secretary HHS
Hon. Fred Upton, Chairman, Comm. on Energy & Commerce House of Representatives
Hon. Henry Waxman, Comm. on Energy & Commerce House of Representatives
Hon. Harold Rogers, Chairman, Comm. on Appropriations House of Representatives
Hon. Norman D. Dicks, Comm. on Appropriations House of Representatives
Hon. Tom Harkin, Chairman, Comm. on Health, Education, Labor & Pensions US Senate
Hon. Michael B. Enzi, Comm. on Health, Education, Labor & Pensions US Senate
Hon. Daniel K. Inouye, Chairman, Comm. on Appropriations US Senate
Hon. Thad Cochran, Comm. on Appropriations US Senate
Committee On Oversight & Government Reform
James M. Anderson, M.D., Ph.D., Chairperson, NIH Council of Councils
Sally Rockey, Ph.D., NIH Deputy Director for Extramural Research
Colleen Barros, M.A., Deputy Director for Management & Chief Financial Officer
David E. Benor, Associate General Counsel, HHS Public Health Division
Preet Bharara, U.S. Attorney for the Southern District of New York
[1] An extended version of this Open Letter which contains details of facts and exhibits is attached as Addendum to this letter. Copies of the Reports are enclosed as Exhibit A to the Addendum.
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