Police probe possible fraud by UBC med researcher

By Stanley Tromp, Globe and Mail, May 6, 2015



Two years ago, the school fired a medical researcher for improperly claiming expenses. The RCMP is also looking into allegations of financial improprieties worth $5-million at the UBC dental clinic.

Police are investigating allegations of fraud within the faculty of medicine at the University of British Columbia, prompting the school to note it is working hard to install safeguards to prevent further cases.

Audits obtained by The Globe and Mail through an access to information request say that, two years ago, the school fired a medical researcher for improperly claiming the same expenses two or three times from UBC, the Vancouver Coastal Health Authority and the BC Cancer Agency.

The audits, which do not identify the person, estimated that UBC lost $425,000. The university turned its findings over to police.

The Vancouver Police Department rejected an access request for documents on the matter because the case remains "under investigation." The other agencies declined to comment.

The auditors said the researcher improperly transferred funds among accounts and gave improper paybacks to a third party. UBC said it appears that claims for lab supplies were unjustified. The auditors also questioned the man's claims for work-related overseas travel, which consumed one-quarter of his time.

"All of his descriptions of the reason for travel were vague and inadequate," the auditors wrote in the 2013 report. "The length of the visits also seems excessive for research purposes."

In a second case covered last November by The Globe, RCMP are investigating allegations of financial improprieties worth $5-million at the UBC dental clinic run by Christopher Zed. UBC has said concerns surfaced in 2013 when senior administrators were told of "suspected financial irregularities" involving a program that was overseen by UBC faculty, including Dr. Zed. The high-profile dentist was associate dean of strategic and external affairs at UBC's faculty of dentistry before leaving that position in December, 2013. The university has not said why Dr. Zed left.

UBC's dean of medicine, Gavin Stuart, said in an e-mail that if the Crown charges the medical researcher mentioned in the internal audits, UBC will release more information.

For privacy reasons, UBC will not identify the researcher or say where he is or what he is doing now.

Dr. Stuart said the university is considering its options for recouping the $425,000: It could wait for a judge to order repayment conditions after a criminal trial, seek restitution in a civil proceeding, or request reimbursement through UBC's insurance providers.

"UBC takes any and all cases of financial impropriety very seriously," Dr. Stuart wrote. "We have a zero tolerance for it."

Dr. Stuart said the medical faculty's financial branch was reorganized in 2012 in response to a fraud case. John Mwotassubi, the former financial manager of UBC's pediatrics department, was sentenced to two years of house arrest for stealing more than $450,000 in a cheque scheme.

Dr. Stuart said all finance staff are now required to report to senior accountants who are independent of the departments. All transactions must have two signatures, and are reviewed separately, finance staff now have better training and supervision, and several more staff have been hired.

Dr. Stuart also added that while the faculty's 2015-16 budget is more than $600-million, the impropriety noted in the audits amounts to less than one per cent of that amount.

Separate UBC audits detailed other financial problems, but Dr. Stuart said these occurred before the new financial controls were installed and "the documents show gaps are being found and closed before they are exploited."

For example, UBC auditors criticized the university's Centre for Molecular Medicine and Therapeutics for operating an unauthorized bank account with poor controls from 2001 until it was closed in April, 2013. The fund gave small short-term loans to staff for expenses. But Dr. Stuart wrote that the loans were repaid and UBC found no evidence of financial impropriety.

A separate internal audit in October, 2012, by the Vancouver Coastal Health Authority also warned of a high risk of fraud from staff double dipping at VCH and UBC, which could lead to "negative publicity," a problem assigned to a high priority red category.