Former professor and his Del Mar-based corporation charged with fraud

A former research professor at the University of California San Diego and his Del Mar-based corporation were charged in federal court Jan. 7 with fraudulently obtaining millions of dollars in government grants and contracts.

Dr. Homayoun Karimabadi, 56, and his company, SciberQuest Inc., were arraigned on wire fraud and criminal forfeiture charges. SciberQuest entered a guilty plea and Karimabadi is scheduled to enter a deferred prosecution agreement on Jan. 15.

The deferred prosecution is an agreement between the defendant and the U.S. Attorney’s Office in which the defendant admits to the facts constituting a criminal offense, but the government agrees to suspend the entry of judgment for a period of time and agrees to dismiss the charges if, during that period, the defendant complies with certain conditions in the agreement.

Karimabadi and SciberQuest jointly agreed to forfeit $180,000 as money that was improperly received as a result of the fraud, in addition to a fine that will be imposed on the corporation at sentencing, prosecutors said.

According to court records, during the fraud Karimabadi was the chief executive officer and chief technology officer of SciberQuest, and at the same time was employed as a research professor at UC San Diego, where, among other things, he served as the group leader of the space physics plasma simulation group.

According to the corporation’s plea agreement, from January 2005 to June 2013, Karimabadi applied for and received grants or contracts from the National Science Foundation, the U.S. Air Force and NASA, both through SciberQuest and UC San Diego.

SciberQuest was awarded about $6.4 million under 22 separate grants or contracts. Of those, eight were Small Business Innovation Research grants with a value of nearly $1.8 million.

The SBIR program was enacted by Congress to strengthen the role of innovative small business concerns in federally-funded research and development in order to stimulate technological innovation, foster and encourage participation by socially and economically disadvantaged small business concerns, and increase private sector commercialization of innovations derived from federal research and development, thereby increasing competition, productivity and economic growth.

To obtain the SciberQuest grants or contracts, Karimabadi made false statements to government officials, prosecutors said. Specifically, in award proposals, he failed to disclose all of his and SciberQuest’s current and pending grants or contracts, thereby overstating the time he and SciberQuest could devote to the projects he was applying to receive.

In one example, Karimabadi only disclosed to NSF four current and 11 pending grants and knowingly failed to disclose an additional 10 current and five pending grants.

In all, Karimabadi disclosed to NSF only about three months per year of work that he was committed to when, in fact, he had already committed to various

agencies more than 19 months per year of work.