Professionalism/Shih Chi Liu and the NSF

Dr. Shih-Chi Liu is a former program director at the National Science Foundation who was accused of defrauding his employer by double-charging work related expenses.

Logo of the National Science Foundation

Background

Dr. Liu was born in 1939. He received a BS in civil engineering at National Taiwan University in 1960 and both his MS and Ph.D. in civil engineering at the University of California-Berkeley in 1964 and 1967 respectively. He worked at the National Science foundation from 1975-2011. He held various program director positions during his time there, spending most of his career as the program director for the Earthquake Hazards Mitigation Program before becoming the director of the Sensors and Sensing Systems Program. Dr. Liu gained international renown for his work at the NSF. He has published many papers and scientific journals and promoted cooperation between the US, Japan, China, Europe, India, Korea, and Taiwan on earthquake engineering, smart structure technologies, bio-inspired sensing and actuation. The International Conference on Earthquake Engineering in Harbin, China described Liu as a "charismatic and creative leader, leveraging multilateral collaboration to increase the safety of our society and the reliability of civil infrastructure and building international understanding and goodwill among engineers and scientists throughout the world".

Dr. Liu's personal ethics featured a focus on scholarship and finding a balance between work and harmony. He taught his students the Five Pillars of Scholarship from Confucius and enjoyed making analogies to yin and yang, using them as a representation of Eastern and Western cultures. He appreciated what he noted to be the more traditional, communal focused values of Eastern culture in contrast to what he believed to be the more self-centered values of Western culture.

Professionalism Violations

Hostility with USCIS

In 2005 one of Dr. Liu's colleagues, who he was trying to get a job at the NSF, was denied an immigrant visa by the US Citizenship and Immigration Services. Dr. Liu appealed this decision, stating that the job his colleague sought was valuable to US national interests. Dr. Liu was hostile in his appeal letters, accusing his colleague's examiners of being "lazy or incompetent" and "not competent at either reading or writing in the English [l]anguage". USCIS noted that his letters featured many spelling mistakes and grammatical errors. Although USCIS acknowledged that the work his colleague would be doing was important, Dr. Liu's appeal letters were denied on the grounds that immigrant visas must be granted based on the qualifications of the individual, not on the potential to do important work. Dr. Liu's aggressiveness towards USCIS likely played a part in the decision.

Stealing from the NSF

Dr. Liu stole over $15,000 from the National Science Foundation over the course of five years through falsified travel claims and invoices. On more than six different occasions between September 2006 and June 2010, Dr. Liu billed an unspecified accredited university in Colorado for services that were not performed and for travel expenses that were already covered by the NSF. These payments were not reported to the NSF. Annually, Dr. Liu was required to submit a financial disclosure report on any travel reimbursements and gifts over a certain amount. To hide his actions, Dr. Liu filed fake reports that failed to show the various payments he had received. He sent fake invoices to the Colorado university for university funding or billed both the university and the NSF for the same expenses.

Dr. Liu was tried on May 30th of 2012. He pled guilty to a single count of making a false statement before U.S. District Judge James C. Cacheris. He was sentenced in federal court on August 22, 2012, facing a maximum penalty of five years in prison and a fine of $250,000. Liu did not go to prison, instead paying the fines and being put on probation. As of May 2017 he is in China serving as an adjunct professor at Southeast University and Nanjing Tech.

Analysis

Double billing

Liu double billed the Colorado university and the NSF for his travel expenses. In law, double billing is a violation of two American Bar Association's standards in the Model Rules of Professional Conduct. Rule 8.4 and Rule 1.5 prohibit dishonesty and unreasonable fees, respectively. In medicine, double billing can occur when a healthcare provider bills Medicare/Medicaid, a private insurer, or a patient directly more than once. This practice can violate civil and criminal law, and can incur large fines or prison time.

In government contracting, one law firm describes the practice as "increasingly common" with the "expansive, voluminous nature of the contract work." These activities are prohibited under the False Claims Act, which was enacted in 1863 to prevent defense contractor fraud during the Civil War. The act has since been amended to allow for qui tam lawsuits, in which a whistleblower can sue on behalf of the government and earn a portion of the government's damages.

Oversight

The DOJ notes that of $2.2 billion in "recovered" false claims in 2020, $1.6 billion arose from such qui tam lawsuits. The fact that around 70% of recovered false claims originate with whistleblowers indicates a non-trivial lack of oversight in the government, of which Shih-Chi Liu was an employee. Liu had worked at the NSF for nearly 45 years and had seniority status as a program director. While he was director of the Sensors and Sensing Systems program, Liu could award grants of up to $50,000 from the program's $5.5 million annual budget without supervisory approval. Like Gyges in "The Ring of Gyges" from Plato's Republic, Liu had a sort of invisibility ring in his position at the NSF. The story argues that with such an invisibility ring no man would "stand fast in justice," which Liu did not.

NSF funding guidelines

Shih-Chi Liu is listed as an author on a "request for proposals" in "Organic Electronics, Photonics and Magnetics," for which the NSF will grant funding. In reviewing a research activity, the document lists several questions a proposal must answer, including:

How well does the activity advance discovery and understanding while promoting teaching, training, and learning? To what extent will it enhance the infrastructure for research and education, such as facilities, instrumentation, networks, and partnerships? Will the results be disseminated broadly to enhance scientific and technological understanding?

While not research activities, his double-billed travel expenses cannot be squared with the fund-allocating rules that carry his name.

Related Instances of Research Fraud

At the NSF

In 2012 the NSF Inspector General detailed an incident of a program officer double-, triple- and quadruple-billing travel to different clients, one of which was the NSF. The Inspector General was informed of this through a University that was conducting an investigation, where over $170 thousand in travel was estimated to be overbilled. State charges were brought rather than federal due to the "small loss to the US government;" however, the employee was terminated from the NSF.

In 1995 a professor at Cornell University resigned after an investigation into five instances of double-billing travel expenses to the NSF, totaling $5,000 in illegitimate funds. No charges were brought.

In 2014, Manoj Kumar Jha, a professor at Morgan State University, was convicted of wire fraud, mail fraud, falsification of records, and theft of government property after fraudulently obtaining $200,000 in grant funds from the NSF and using it for personal expenses. He was sentenced to three years in prison.

Stolen Research Funding

In October 2020 Dr. Geoffrey Girnun, a former professor at Stony Brook University, was sentenced to one year and one day in prison for stealing over $200,000 in cancer research funds to make personal mortgage and tuition payments.. He pleaded guilty in January 2020 and agreed to pay $225,000 in restitution to the National Institute of Health and Stony Brook University.

In 2009 Samim Anghaie, a nuclear engineering professor at the University of Florida, was found to have fraudulently obtained millions of dollars in government contracts from NASA, spending it on luxury cars and real estate. He submitted fake invoices to the university and underpaid researchers or didn't pay them at all. He was sentenced to six months in prison.

Conclusion

These white-collar embezzlement crimes, while ethically untenable, appear to avoid the full force of the law. Dr. Liu got off with probation and fines, with related cases meeting similar punishments. The honor code of the University of Virginia, under which the NSF-funded Online Ethics Center operates, prohibits "lying, cheating or stealing," famously in that order. The ethics section of the NSF website focuses primarily on scientific and academic integrity, and to a lesser degree, misuse of resources. This is perhaps because academic dishonesty, or lying, is considered worse an offense than misuse of resources, or stealing. Academic dishonesty can destroy the reputation of an institution whose mission is to "promote the progress of science," while stealing is a material loss that can be more easily repaired.

Future Research

Future researchers should look at more instances of research or grant fraud at the NSF, for additional information on Shih Chi Liu is scarce. Double billing is a broad enough topic that several more casebook chapters could be made on the subject. The NSF features its own handbook on grant fraud, and it would be useful for future researchers to reference when studying how the NSF's own workers violate it. In relation to Dr. Liu's letters to USCIS, more research could be done on instances of researchers attempting to use the importance of their work for privileges not granted to other people.