In light of GW’s efforts to strengthen internal oversight controls at its National Crash Analysis Center in Virginia and revise its policies for federal grants, the Department of Transportation’s inspector general has recommended that the Federal Highway Administration reinstate its financial agreement with the crash center.
The University will push to renew federal funding for the center when its current grant from the Federal Highway Administration, which has been frozen for more than a year, expires next week.
In June 2004 the FHWA suspended part of a $14 million crash center grant as it investigated charges that the center’s former director, Nabih Bedewi, embezzled approximately $1 million in DOT grant funds. On Sept. 30 the DOT released the inspector general’s recommendation, titled “Audit of Actions to Prevent Fraud on Cooperative Agreements with Universities.”
According to the DOT report, Bedewi was able to embezzle federal funds from the center because “first, GWU lacked basic controls to prevent or detect fraud, and second, FHWA rubber-stamped approvals on payment requests.” Since University officials uncovered Bedewi’s financial misconduct in May 2004, they hired a financial adviser to oversee the program’s fiscal operations and have subjected the center to stronger federal scrutiny, said Donald Lehman, executive vice president of academic affairs.
The National Crash Analysis Center, located in Ashburn, Va., was established in 1992 and receives 80 percent of its funding from the federal government. According to the DOT report, the FHWA has provided $13 million in grants to the center since 1997, but the funding freeze last summer led the University to indefinitely halt construction of a Transportation Research Institute intended to study automotive safety.
The report said GW has taken several corrective steps in its crash center operations in light of DOT recommendations and its own internal audit. The University will submit detailed reports to the FHWA on such items as employee labor hours and equipment invoices for all billings, while FHWA and University officials will meet weekly to review “progress under the agreement.”
“Certainly, whenever an incident like this occurs you change processes so there is closer oversight and this has certainly happened in this case,” Lehman said.
Following the Bedewi scandal, the FHWA has also taken steps to improve the way it administers and oversee federal grants to all universities, the DOT report stated.
In March, Lehman told The Hatchet that GW would continue to fund some crash center operations in the face of the grant suspension, but the University couldn’t “do it indefinitely.” Part of the federal suspension was lifted to maintain the crash center library and operate a program with the U.S. Secret Service. The center also continued to receive funding from the Ford Foundation and Hyundia-Kia, Lehman said.
“There are different pieces of the (National Crash Analysis Center) … there was only a small piece discontinued,” he wrote in an e-mail to The Hatchet last week.
Bedewi, who was arrested in October 2004, pled guilty to embezzlement charges in April and was sentenced to 38 months in jail and ordered to repay $872,000 to GW. Bedewi used the stolen money to buy Washington Redskins tickets, pay off credit card balances and purchase a condominium in Florida, according to court documents.
The University was ordered to pay the federal government $1.8 million in restitution.
-Marissa Levy contributed to this report.