by Ben Vernia | January 27th, 2016
On January 21, the Department of Justice announced that the Big Brothers and Big Sisters of American Corp. had agreed to pay $1.6 million to settle civil allegations that the organization submitted false claims to the Department for grants for assisting at-risk children. According to DOJ’s press release:
Big Brothers Big Sisters of America Corporation (Big Brothers) has agreed to pay the United States $1.6 million to resolve allegations of false claims for funds under Department of Justice grants awarded to help children at risk, the Justice Department announced today. Big Brothers is a not-for-profit organization that provides mentoring services to boys and girls throughout the United States. The organization, originally based in Philadelphia, Pennsylvania, is now headquartered in Tampa, Florida.
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Big Brothers is a national organization that acts through approximately 300 independent affiliate agencies across the United States. Since 2004, Big Brothers has received millions of dollars in grants from the Justice Department to support initiatives on behalf of children at risk. As a condition of those grants, Big Brothers was required to maintain sound accounting and financial management systems in accordance with federal regulations and guidelines designed to ensure that grant funds would be properly accounted for and used only for appropriate purposes.The United States alleges that Big Brothers violated these regulations and guidelines with respect to three grants awarded by the Justice Department from 2009 to 2011, by commingling the grant funds with general operating funds, failing to segregate expenditures to ensure that the funds were used as intended and failing to maintain internal financial controls to safeguard the proper use of those funds. These allegations were the focus of a 2013 audit of the three grants performed by the Department of Justice Office of the Inspector General. Since 2013, Big Brothers has replaced its management team and begun implementing policies governing the use of federal grant funds.
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In addition to paying the United States $1.6 million, and as part of the settlement, Big Brothers has agreed to institute a strict compliance program that requires the organization to engage in regular audits, both internally and by independent auditors; establish a compliance team, an employee code of conduct, whistleblower policies and a disciplinary policy for employees who engage in or fail to disclose abuses of federal grant funds; provide regular employee training on these policies; and employ risk assessment tools to detect abuses that might otherwise go undetected.
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The case was apparently initiated by the Department’s Inspector General, and not by a qui tam whistleblower.
