Assistant Professor Admits Embezzling from Washington University

ST. LOUIS – An assistant professor of pathology and immunology at the Washington University School of Medicine on Wednesday admitted embezzling $412,000 from his employer.

Gary Grajales-Reyes, MD-PhD, who maintained an office and research laboratory at the School of Medicine (WashU Medicine), pleaded guilty in U.S. District Court to three counts of wire fraud.        

The scheme involved Grajales-Reyes submitting false requisition requests to WashU Medicine for internal and external hard drives and graphics cards falsely claiming that the computer equipment was for his WashU Medicine research laboratory.  Relying upon the false requisition requests, WashU Medicine purchased the requested computer equipment from its vendor, which then shipped the computer equipment directly to Grajales-Reyes’ research laboratory.  WashU Medicine then paid for the computer equipment.  After Grajales-Reyes received the falsely obtained computer equipment he sold the equipment by two different methods, without the knowledge or authority of WashU Medicine.  He sold some of the computer equipment through his personal eBay site, and he also sold some of the computer equipment to an Amazon based third-party seller.  He used the money obtained by selling the computer equipment for his own personal expenses unrelated to the work and operations of WashU Medicine, and without the knowledge or authority of WashU Medicine.  Over the period of his scheme, Grajales-Reyes submitted 73 false requisition requests to WashU Medicine for internal and external hard drives and graphics cards, which included approximately 761 different computer parts.  As a result of his scheme, WashU Medicine and Washington University paid approximately $412,163 for the computer parts, which Grajales-Reyes then sold for money which he used for his own personal expenses, unrelated to the work and operations of WashU Medicine.  Federal law enforcement seized a substantial quantity of collectible trading cards from Grajales-Reyes’ laboratory. He had purchased the cards with some of the funds he obtained from selling the computer parts.    

Grajales-Reyes is scheduled to be sentenced on December 4. Each count carries a potential penalty of up to 20 years in prison, a fine of up to $250,000, or both prison and a fine.

The FBI investigated the case, with the cooperation and assistance of Washington University. Assistant U.S. Attorney Hal Goldsmith is prosecuting the case.