HHS OIG Calls for Univ. of Southern California To Reimburse More Than $1M in Federal AIDS Funding Citing Misuse
Auditors at the HHS Office of Inspector General have called for the University of Southern California to reimburse the federal government $1.08 million of a total of $1.27 million in funding for "lapses" in the university's management of an HIV/AIDS peer treatment educator program, the Los Angeles Times reports (Silverstein, Los Angeles Times, 7/31). In 2001, USC's program was shut down by federal regulators, who cited concerns about conflicts of interest, improper research procedures and misuse of funds; the audit released last week found further evidence of such problems, according to the AP/Contra Costa Times (AP/Contra Costa Times, 8/1). University officials said that USC followed federal overhaul recommendations and attempted to discontinue the program after one year but continued to run it at the request of federal partners. USC is challenging the amount that auditors have asked the university to reimburse. "We've acknowledged that we made some mistakes. It's just a question of the amount that's due," Laura LaCorte, senior associate vice president of compliance at USC, said. USC officials said that some expenses were unauthorized but others were federally approved. USC plans an appeal to reduce the reimbursement amount. HHS OIG spokesperson Donald White said that no criminal investigation has been conducted, and the case will be reviewed by the Health Resources and Services Administration.
Conflict of Interest?
According to the Times, the audit cited USC's failure to resolve a conflict of interest related to the program's administration as one of its "major flaws." The alleged conflict of interest involved Phill Wilson, currently the director of the Los Angeles-based not-for-profit Black AIDS Institute, who managed USC's program while also managing the African American AIDS Policy and Training Institute, a subcontractor to the program. Although Wilson resigned as executive director of AAPTI "apparently in response to conflict-of-interest concerns," he continued to manage the group, the Times reports. Auditors concluded that the conflict of interest "opened the door for money to be diverted" to AAPTI for uses not related to USC's program, including $501,000 in expenses for soliciting sponsors for an AIDS march and conducting town hall meetings, according to the Times. In addition, the audit found that although Wilson was "not an experienced researcher," USC allowed him to "contact, recruit, enroll, test and gather information from the peer treatment educators," the Times reports. Wilson did not return phone calls seeking comment on the OIG report, according to the Times. According to auditors, funding for the program was not authorized because organizers had participants sign consent forms that were not approved by USC's institutional review board, which approves all human research studies at the university. The audit also cited inadequately documented expense reports for wages, travel consulting services, public relations and multimedia services (Los Angeles Times, 7/31).