Ex-NYU Researcher Spent Grant Funds on Friend, Family, Feds Say

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By Greg Langlois

A former New York University psychiatry professor broke the law by using federal research money to visit a ballet dancer friend and send family members on trips, federal prosecutors said.

Alexander Neumeister spent tens of thousands of dollars on flights, hotel stays, meals, and other personal expenses using an NYU-issued credit card and falsely said they were related to research projects or other university work, according to a federal complaint. Neumeister is charged with theft of government funds and wire fraud.

The spending allegations are notable. Prosecutors in the Southern District of New York said Neumeister charged the federal government or NYU for the costs of flying a woman they described as his friend from Salt Lake City and Charlotte, N.C., to visit him in New York City; flying her to Miami to stay at a resort; and flying himself to visit her in Utah and in Chicago, where the friend was appearing in a “Sleeping Beauty” performance.

Other Alleged Abuses

Neumeister also used the credit card to pay for lunches with the friend and buy her an iPhone, according to the complaint. He also claimed his friend was a research study participant in order for her to receive compensation, it said.

In addition, he charged the federal government and the university to fly his wife to Austria and his wife and children to Stowe, Vt., the complaint said.

The government theft count carries a maximum sentence of 10 years in prison, and the wire fraud count a maximum of 20 years, the Department of Justice said in a press release.

“For allegedly betraying the trust of the medical school that employed him and the government institute that funded his research, Neumeister now faces serious federal charges,” Acting U.S. Attorney Joon H. Kim said in the release.

Neumeister was arrested on Nov. 21, 2017, in Ogdensberg, N.Y., the department said. The criminal complaint is based on a Nov. 15 sworn statement by a special agent with the Department of Health and Human Services’ Office of Inspector General. The HHS OIG looked at Neumeister’s spending from 2012 to 2014.

An HHS OIG spokesperson said the office would not provide further comment because the investigation is still open.

Kim’s office also filed a civil action against Neumeister alleging False Claims Act violations in an attempt to recover damages for the government.

Prior Trouble

NYU hired Neumeister in 2011 as a professor in its medical school’s psychiatry department, earning a $230,000 salary when he started, the complaint said. He served as a principal investigator for research studies funded by the National Institute of Mental Health, part of the National Institutes of Health, examining stress-related disorders.

NYU’s School of Medicine is “committed to conducting high quality research projects in compliance with regulatory requirements,” according to a statement provided to Bloomberg Law Nov. 29. “As soon as the potential issues specific to this research were identified and reviewed, findings were shared with the appropriate oversight agencies. The researcher is no longer employed at the School of Medicine.

“As a victim of Dr. Neumeister’s actions, as to which NYU School of Medicine may be called to give testimony or further information,” the statement added, “it would be inappropriate to provide additional comment while the federal investigation is ongoing.”

Neumeister left NYU in 2015 after an FDA investigation into a research project examining potential drug treatments for post-traumatic stress disorder. In a 2016 warning letter to Neumeister, the agency described “systemic failures in your conduct of this clinical investigation.”

The court appointed Neumeister a public defender, Christopher Flood, who appeared on Neumeister’s behalf at his initial appearance Nov. 28. Flood was not immediately available for comment.

To contact the reporter on this story: Greg Langlois in Washington at glanglois@bloomberglaw.com

To contact the editor responsible for this story: Randy Kubetin at rkubetin@bloomberglaw.com

For More Information

The criminal complaint is available at http://src.bna.com/uyS; the civil complaint is available at http://src.bna.com/uyR.

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