Federal Audits: Univ. Misspent Millions in Research Dollars

In 1981 and 1982, federal auditors pored over the accounts of direct grant expenses at the Medical School and the School of Public Health (SPH).

And they didn't like what they found.

In a vast majority of the grants and projects reviewed, auditors concluded that Harvard had improperly billed taxpayers for significant expenses.

Those audits--conducted by the office of the Inspector General, the investigative branch of the Department of Health and Human Services (HHS)--cited a total of $3.8 million as unallowable grant costs. The audits covered the fiscal years 1975, 1976 and 1977 for grant research at the Medical School and the SPH.

The auditors disallowed numerous travel expenses, including round trip airfare from Boston to Guatemala, Panama and Colombia for--a non-Harvard employee and without any documentation showing a connection to grant research.

The University also charged the government $103,050 for furniture, kitchen utensils, mattresses, pillows and interior decorating for apartments. And under the same grant, Harvard billed the government $13,460 for entertainment activities, such as cocktail and coffee hours. All these charges were recommended for disallowance.

In addition, auditors found that taxpayer dollars covered a professor's membership fee for a private club.

The government concluded that more than $3 million in direct and indirect cost billings were made "on an arbitrary basis" and that it could not determine the appropriateness of $40 million in salaries and wages because "the University's salary certification procedure is meaningless."