Bay Area pair accused of bilking NASA, NSF

Two Bay Area scientists were indicted by a federal grand jury on Wednesday on charges of defrauding NASA and the National Science Foundation out of $1.2 million in grant money.

Ali Kashani, 52, and Yang Zhao, 40, have been charged with wire fraud and conspiracy to commit wire fraud. Kashani was additionally charged with money laundering.

Kashani is the owner of the San Jose-based research company Atlas Scientific, and Zhao is the company’s principal investigator. From 2007 to 2011, Kashani and Zhao sought research grants from NASA and the NSF for their research on adhesive tape based on carbon nanotubes.

The pair are accused of violating federal law when they allegedly withheld information about the other grants they were applying for or were already receiving from either organization.

The indictment further alleges that Kashani and Zhao knowingly made “materially false statements” to NASA and the NSF to defraud them out of the $1.2 million. Two grants from the NSF totalled $550,00 and two from NASA totalled $700,000.

Zhao is also accused of having lied about her employment status at UC Berkeley on the grant applications.

Kashani was arrested on Thursday and appeared before a federal magistrate in San Jose, according to U.S Attorney Melinda Haag. Zhao, who formerly lived in El Cerrito is now living in China.

Kashani will face U.S Magistrate Paul Grewal on Tuesday, where his defense attorney will be identified and it will be decided if he should be released on bail.

The two defendants can face up to a maximum 20 years for the conspiracy charges and up to 10 years for the fraud charges in federal prison.