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Wheeling school to pay government $2.3 million

WHEELING, W.Va. — Wheeling Jesuit University will pay the federal government $2.3 million to settle claims that it misused grant funding awarded by the National Aeronautics and Space Administration, the United States Department of Labor, and the National Science Foundation

U.S. Attorney William Ihlenfeld said the settlement agreement ends an investigation into allegations that the university failed to comply with rules and regulations governing the allocation of costs and expenses associated with several federal grant awards.

The allegations arose as the result of an audit conducted by NASA which led to the execution of a federal search warrant at university offices and elsewhere in February of 2012.


The settlement also addresses ownership of the National Technology Transfer Center building on the university’s campus. The building was constructed in accordance with a federal grant from NASA. As part of the settlement, WJU will retain ownership of the building.

WJU Director of Communications Kelly Klubert the university will pay the settlement over the next five years.

The settlement resolves all civil and administrative claims related to the universitys federal grants from 2003 to 2010 and provides for the transfer of ownership of the National Technology Transfer Center campus building to the university, she said. The allegations leading to the settlement arose from highly complex and divergent provisions of the federal regulations governing the cost principles applicable to federal grants. In good faith and with complete and steadfast disclosure to the federal government, the university had used the same costing practices in its financial management of federal grants since 1998. The regulations at issue have since been replaced in their entirety by simplified rules.

Klubert said operating capital will be used to pay the settlement, excluding any federal funds or private donations. Additionally, the settlement will have no bearing on other federally funded programs at the university.

J. Davitt McAteer, former chief executive officer of the universitys Center for Educational Technologies and the National Technology Transfer Center and former director of the federal Mine Safety and Health Administration, was the focus of the investigation. A NASA investigator alleged that McAteer fraudulently billed expenses to federal grant programs or cooperative agreements between WJU and the federal government from 2005 through 2011.

The NASA officials statement cited spending that included cellular phones, computers, technical support and salaries including a secretary in McAteers private law office in Shepherdstown; and McAteers salary, which increased from $130,300 in 2006 to $230,659 in 2008, was also cited.

Between fiscal 2000 and 2009, NASA gave Wheeling Jesuit more than $116 million — more than $65 million of that after McAteer took over the schools Sponsored Programs Office.

McAteer retired from his post in June, a decision Wheeling Jesuit said was planned long before revelations of a probe.

Ihlenfeld said the university is alleged to have improperly mischaracterized costs, incurred impermissible costs and misused federal funds and property acquired with federal funds from 2003 to 2010.

The settlement, signed by Ihlenfeld and previously executed by university officials, resolves False Claim Act violations the government was prepared to pursue. However, it does not preclude criminal charges against individuals involved in the grant fraud.

Wheeling Jesuit University applied to the federal government and received many millions of dollars in funding but failed to follow the rules that came with the resources, Ihlenfeld said. Grantees must use federal money for the purpose for which the grant was given, and for nothing else. The rules are clear, and they exist to ensure that tax dollars are spent appropriately.

Ihlenfeld said he is hopeful the settlement will allow the university to move forward.

Educational institutions, like everyone else, must be held accountable when the rules are broken, he said.

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