Lexington woman charged in scheme to fake contracts, records for $1 million in grants
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A Lexington woman indicted this month in federal court is accused of having a role in faking letters and documents about the use of more than $1 million in research grants.
The woman worked with the co-owner of a Lexington company, ScienceTomorrow, LLC, to misuse U.S. Department of Energy grants and submit falsified federal financial reports about how the money was spent, according to court records. The scheme occurred between 2013 and 2017, according to indictments in the case.
Jyoti Agrawal is charged with wire fraud, wire fraud conspiracy and money laundering, according to her indictment filed earlier this month.
Agrawal and Subhadarshi Nayak owned ScienceTomorrow, and Agrawal paid Nayak money from the unlawfully acquired grants, according to her indictment.
Nayak was previously indicted on seven counts of wire fraud, six counts of making false claims, and one count each of wire fraud conspiracy and money laundering, according to court records.
The two worked together to obtain the grants, which were for “small business innovation research,” according to their indictments. Knowing that working with universities and experts increased their chances of obtaining the grants, Nayak filed false documents claiming contracts with a university and professors’ work that didn’t exist, according to court records.
Agrawal and Nayak are accused of “re-purposing” $45,000 in funds allocated for a contract with an unnamed university without disclosing that to the Energy Department, according to their indictments.
In other documents about the work being done through the grants, Nayak claimed that two professors, one at the University of Kentucky and another at a Tennessee university, were vital to his company’s work, according to his indictment. However, neither professor made any agreement with the company to perform that work. Nayak is accused of turning in fake but detailed progress reports about the professors’ work, according to his indictment.
The grant program does not allow businesses to retain unspent funds beyond the contract year, but in 2016, ScienceTomorrow was found to have $319,000 in unreported funds in its bank account, according to Agrawal’s indictment. She’s accused of concealing the money and continuing “to spend DOE funds in the possession of ScienceTommorrow, LLC, as she pleased, knowing this was unlawful and in violation of the terms of the DOE grant and SBIR program guidelines.”
If convicted, the most serious charges against Agrawal and Nayak could result in 20 years in prison, according to their indictments. The most serious charges also could result in a fine of not more than $250,000 or “twice the gross gain or loss,” whichever is greater.
Nayak’s jury trial is set to begin in August.
This story was originally published May 20, 2021 at 11:16 AM.
