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Lawrence company pays $670K to settle false claims allegations

KalScott awarded grants from NASA, Air Force
US Attorney's Office for the District of Kansas
Posted at 3:15 PM, Nov 23, 2020
and last updated 2020-11-23 18:31:28-05

KANSAS CITY, Mo. — A Lawrence engineering firm will pay more than $670,000 to settle allegations that it received grant funds from NASA, the Air Force and the Navy by submitting false claims, federal prosecutors said Monday.

Between April 2012 and July 2015, KalScott Engineering received Small Business Innovation Research grants from the National Institutes of Health, NASA and the U.S. Air Force, as well as a Small Business Technology Transfer Program grant from the U.S. Navy.

The two grant programs provide small businesses the opportunity to do research for the federal government with a potential for commercialization.

The businesses selected for the grants must designate a principal investigator and key personnel for the projects.

Prosecutors allege that KalScott said its vice president, Suman Saripalli, was a principal investigator when in fact he was not eligible to serve in that role.

KalScott also allegedly did not perform a majority of its work under the Air Force grant and used different key personnel than listed to receive the NIH grant.

“Recipients of federally funded grants must adhere to the program requirements,” U.S. Attorney for Kansas Stephen McAllister said in a news release.

KalScott, Sairpalli and president Thomas Sherwood will pay $672,352 to settle the allegations, according to prosecutors.

The case was investigated by the NASA Office of Inspector General, the Naval Criminal Investigative Service, the Air Force Office of Procurement Fraud Investigations, the Department of Health and Human Services, Office of Inspector General, Office of Investigations, and the U.S. Attorney’s Office for the District of Kansas.