Hermosa man to pay after research fraud

SIOUX FALLS – A Hermosa man who defrauded the National Science Foundation when he falsely claimed he was involved in South Dakota State University research on solar cells has been ordered to pay a civil judgment of more than $220,000.

The National Science Foundation (NSF) is a United States agency created to support basic scientific research by providing grants to individuals, businesses, academic and nonprofit institutions.

Scott Thompson, dba as Isosceles LLC, submitted a grant proposal to study solar cells and develop technology to harvest light and produce renewable energy.

Thompson claimed that a post-doctoral foreign national student of electrical engineering at SDSU was the principal scientific investigator on the project. Relying on Thompson’s statements, the NSF awarded grant funding.

Thompson then represented that the student had worked more than 160 hours on the project and drew down grant funds.

Thompson knew his claims were untrue because he never met or hired the student, according to a press release from the U.S. Department of Justice. He used the grant funds to pay his personal bills.

Thompson was found guilty, after a jury trial in 2014, of two counts of making false claims and two counts of submitting false documents to the NSF and was ordered to pay restitution totaling $87,637.89 to the NSF and SDSU.

The United States Attorney’s Office then brought a civil action pursuant to the False Claims Act (FCA), which imposes liability on persons and companies who knowingly submit false claims to the government.

Persons who submit a false claim must pay to the United States a civil penalty for each false claim, plus three times the amount of damages the government sustained.

Pursuant to the FCA, the court ordered Thompson to pay a civil judgment of $222,362.11 to the United States. The court said that Thompson’s “convictions preclude him from denying the essential elements of the government’s FCA claim” and the jury found that Thompson “knowingly presented false claims to the government in order to receive funds from the NSF.”

Criminal restitution, penalties, and debts obtained by fraud are not dischargeable in bankruptcy.

The investigation was conducted by the National Science Foundation Office of Inspector General. Assistant United States Attorneys Sarah Collins, Eric Kelderman and Cheryl Schrempp DuPris prosecuted the criminal and civil cases respectively.

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