Medical researcher fired over alleged $425,000 fraud

A UBC medical researcher has been fired for alleged fraud costing $425,000, according to an internal audit report obtained though a freedom of information request.

The allegations were first levelled in June 2012 and prompted an internal audit investigation, according to Dean of Medicine Gavin Stuart. The researcher’s employment at UBC was officially terminated in May 2013. An investigation into the financial impropriety is currently ongoing.

UBC will not release details about the researcher’s name or department due to privacy concerns. Nor will the university release information about how or by whom the alleged fraud was discovered, other than confirming that a whistleblower brought the information forward.

“We await details from the Vancouver Police investigation,” said Stuart. “If the Crown decides to press charges, it will release more information about the case to the public.”

The audit report concludes that there is strong evidence the researcher committed fraud. The audit found evidence that the researcher duplicated reimbursements, improperly transferred funds and was responsible for improper paybacks to a third party.

The researcher’s practice of claiming the same expense several times makes up the bulk of stolen funds, according to the audit report. The internal audit also alleges the researcher transferred at least $240,000 from their research accounts to their unrestricted accounts.

The RCMP have confirmed that an active investigation into the mishandling of funds is ongoing but would not provide any additional information.

The audit also raised questions about how often the researcher travelled overseas, though made no conclusions on the validity of their travel expenses.

UBC will not offer details as to what the researcher is doing now. As for the stolen funds, the university has yet to get any money back.

“UBC has not recouped funds at this point,” said Stuart. “There are three avenues open to the university to recoup money in a case of financial impropriety. One, wait for a judge to order repayment conditions after a criminal trial. Two, seek restitution in a civil proceeding. Or three, through our insurance providers.”

However, Stuart said insurance will not cover the money in this case, since the deductible is higher than the loss.

According to Stuart, the Faculty of Medicine restructured their financial services in 2013 to provide more oversight from senior staff, but the alleged fraud occurred before the enhanced structure was in place.

The former financial manager of UBC’s pediatrics department, John Mwotassubi, plead guilty to stealing funds in 2012. Mwotassubi was sentenced to two years of house arrest for stealing $450,000 in a chequing scheme while working out of B.C. Children’s Hospital. Mwotassubi admitted to writing 75 fraudulent cheques. He reportedly worked as the finance chair at a charity after he left UBC.

Stewart said insurance covered the money Mwotassubi took, minus the deductible, which the court ordered him to pay.