You are currently viewing the printable version of this article, to return to the normal page, please click here.

Records sought from nonprofit for NASA work

Question of the Day

Is it still considered bad form to talk politics during a social gathering?

View results

Federal authorities have subpoenaed bank records from a Chevy Chase nonprofit group over questions about its financial reporting for work performed for NASA, including the Goddard Space Flight Center in Greenbelt.

The U.S. Attorney's Office in Maryland has sought financial records from the Alliance for Competitive Technology as part of a federal probe into whether the group made false claims to NASA, court records show.

The Justice Department and the attorney's office filed papers in U.S. District Court in Greenbelt June 30 on behalf of NASA's Office of Inspector General based at Goddard. The papers say the nonprofit group refused to fully comply with a subpoena, including a request for bank records and tax documents for 2004 and 2005.

The nonprofit is run by Stewart Nozette, who was a staff member at the National Space Council under President George Bush.

Mr. Nozette is a specialist in the Strategic Defense Initiative, or "Star Wars" program, and has held top scientific positions, including one with the U.S. Air Force's Phillips Laboratory in Alexandria.

NASA's inspector general also is investigating whether the nonprofit group actually incurred employee expenses that it reported, documents filed by the U.S. attorney's office show.

An affidavit from a NASA investigator says the Alliance has produced two months of financial records, but that investigators are seeking several years' worth of them.

The two months of bank statements show checks written from the Alliance's business account for utilities, three mortgages, nine credit cards, the La Jolla Tennis Club, Mercedes Benz Credit Corp. and pool cleaning, the affidavit states.

A spokesman for the organization yesterday agreed to talk about the investigation on the condition that he not be identified.

The spokesman said, "There were no improper costs at all. And the services were all provided to NASA."

"We're trying to resolve this," the spokesman said.

An attorney for the Alliance has stated in a letter to NASA's Office of Inspector General that none of the checks produced in response to the subpoena is related to salary payments to Mr. Nozette.

The letter also states that the "mission and Dr. Nozette's professional pursuits are virtually congruent. ... Consequently, [the Alliance] funds spent for the benefit of Dr. Nozette can and are for the benefit of the [Alliance] and largely tax exempt."

The Alliance spokesman said the nonprofit uses a different method to report financial data to NASA than to the Internal Revenue Service.

He said the Alliance voluntarily disclosed to the IRS that questions have been raised during the NASA investigation. He also said the group has yet to file its 2005 tax return and that it could, if necessary, amend prior years' tax returns.

"We have documentation to show everything has been business-related," he said.

A NASA investigator stated in an affidavit that Mr. Nozette entered into a deal with NASA in which the space agency would pay for his salary of $141,718 and benefits up to 40 percent of his base salary.

However, the expenses were not reflected in the organization's tax return, the affidavit said.

The NASA investigator, employed at the agency's Office of Inspector General, said he thinks "a similar pattern of alleged fraudulent activity" occurred in two other agreements.

The investigator said he has investigated Alliance work agreements with the Naval Research Laboratory from 2000 to 2002 and the Defense Advanced Research Projects Agency from 2002 to 2004.

The Alliance fought to quash NASA's subpoena in federal court in the District in May, but a judge granted the space agency access to the bank records.

Comments
blog comments powered by Disqus