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Whitehead returns money

By Jeremy Hylton

In early May the Whitehead Institute for Biomedical Research admitted that it had wrongly charged the federal government for indirect research costs. The MIT-affiliated research institute refunded $33,128 to the government, the second such payment it has made this year.

The payment, made to the Department of Health and Human Services, came a month after the Whitehead Institute made a similar payment of $68,966 to the National Institutes of Health.

The Boston Globe reported that the funds were spent on "entertainment, travel, automobiles, gifts and flowers, community education, insurance of art, investment consultants," and what one document described as "travel associated with the Cell paper matter."

The Cell paper matter refers to a 1986 article in the journal Cell that was co-authored by former Whitehead director David Baltimore '61. In March, the NIH concluded that former MIT researcher Thereza Imanishi-Kari, another author of the paper, had fabricated data.

The $102,094 repaid by the Whitehead Institute is in addition to $731,000 that MIT wrongly claimed as indirect research costs. A portion of the money returned by MIT, however, did cover money spent by the Whitehead Institute. The law firm of Kirkpatrick and Lockhart was paid $27,317 to assist three MIT officials testify before a House of Representatives subcommittee on questions regarding the Cell paper.

Both institutes made their announcements after Rep. John D. Dingell (D-MI) requested them to review their indirect cost records. Dingell has spearheaded a national investigation of indirect research costs that has also focused on Stanford University and Harvard Medical School.

After reviewing their records, the institutes found that they had wrongly billed the government in 1988. There was no indication that further refunds would be forthcoming.

Professor of Biology Gerald R. Fink, director of the Whitehead Institute, and John Pratt, director of the office of administration, both declined to comment on the refunds. Instead, they referred to the statement released by the Whitehead Institute on May 10.

"Like many other academic and research institutions, Whitehead is re- evaluating the institute's policies and procedures with respect to indirect costs. As part of this re-evaluation, the institute has identified certain costs inappropriately included in past indirect cost reports, particularly for the year 1988," the statement said.

"The Whitehead Institute has reimbursed the government for these costs in two separate payments. The re-evaluation process will continue in an effort to ensure the best compliance with government policies," the statement continued.

The Whitehead Institute had attributed its earlier error to an auditing mistake. A letter to the Department of Health and Human Services said that Baltimore had "clearly directed the administration of the institute to exclude these costs from the indirect pool."

James J. Culliton, MIT's vice-president for financial operations, also attributed MIT's error to auditing problems. He said some of the improper charges were errors that "slipped through," while others resulted from changes in government regulations defining allowable costs.

Indirect research costs are intended to cover expenses like building maintenance and departmental administration. Both institutions also receive direct federal research funds that cover expenses like equipment and salaries.