UNC-Chapel Hill is one of two universities required to pay a total settlement of $842,500 following a federal investigation by the Department of Justice alleged that the universities reported false claims for AmeriCorps grant funds.
Acting United States Attorney for the Eastern District of North Carolina G. Norman Acker, III, and the AmeriCorps Office of the Inspector General reached the settlement last month with UNC-Chapel Hill, East Carolina University and the North Carolina Commission on Volunteerism and Community Service.
The DOJ alleges that the universities and NCCV falsely certified volunteer hours over holidays and weekends and violated grant requirements for funding between 2014 and 2019. For example, the investigation found that the institutions in some cases certified 16-hour days, which surpassed the available service site hours, except when approved by a supervisor.
"The United States contends that these actions constituted a misuse of grant funds and harmed AmeriCorps programs," the DOJ said in a Sept. 21 press release.
The DOJ also said that the universities acted with "reckless disregard" in their approval of documenting volunteer timesheets and failure "to maintain proper internal controls."
“These AmeriCorps programs were meant to support at-risk and low-income youth academically. Instead, the universities and agency involved here ran them in a way that allowed participants to falsify their timesheets, and robbed North Carolina communities of the assistance they were supposed to receive,” AmeriCorps Inspector General Deborah Jeffrey said in the press release.
UNC will pay $375,000 to the U.S. government — the most of any other entity in the settlement. Under the agreement, UNC denies liability for any false claims.
The University has 60 days to pay the federal government with further instructions pending, University spokesperson Pace Sagester said in an emailed statement.
When asked where the money would come from, Sagester said that the University has no additional information to share at this time.
Deputy Director of East Carolina University News Services Jamie Smith said in a statement that ECU denies the allegations and believes there is evidence that would contradict them.
"ECU settled the case to avoid the additional costs and the uncertainty of litigation," Smith said.
The ECU settlement of $140,000 will come from institutional funds, Smith said, and will not affect the funds already distributed through the program.
The investigation began after a federal audit from 2014 to 2017 and focused on timesheet documentation practices for AmeriCorps members from two statewide public service programs, Sagester said.
Per the government's request and subpoenas, the University reviewed over 900,000 pages of documents and cooperated fully, Sagester said.
"UNC-Chapel Hill worked diligently to fairly resolve this matter and strengthen our stewardship of AmeriCorps funding that has benefited thousands of students, college advisers, adult literacy learners, literacy tutors and educators across North Carolina," he said.
The DOJ said that universities, state agencies, and all those seeking federal funds are required to make honest claims for payment and those who do not will be held accountable, it said.
In response to the investigation and settlements, Sagester said that the University implemented practices aimed at mitigating the chances of future falsification incidents, such as new timesheet approval rules, verification and training.
"We take our obligation to strictly follow the regulations that come with those taxpayer funds very seriously," Sagester said.
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