Solyndra Loan: Now Treasury Dept. Is Launching Investigation
FBI already searched HQ of failed solar firm.
Sept. 14, 2011 — -- The Treasury Department's inspector general has opened a new front in the investigation of the government loan to Solyndra, the now bankrupt company that had been touted as a model of President Obama's ambitious green energy program, ABC News and the Center for Public Integrity/iWatch News have learned.
The new probe involves the $535 million loan, arranged by the Energy Department, but actually processed by the Federal Financing Bank, a government lending institution that falls under Treasury's control. Already, the FBI and the Energy Department's inspector general have executed search warrants at Solyndra's headquarters and questioned company executives.
"We're going to look at everything the FFB had to do with its role in this thing," Rich Delmar, a spokesman for the Treasury Department's inspector general, told ABC News and iWatch News.
Earlier this month, iWatch News and ABC News disclosed that Solyndra received a rock-bottom interest rate of 1 to 2 percent -- lower than those affixed to other Energy Department green energy projects. The low rate was set even as an outside agency, Fitch Rating, scored Solyndra as a B+ -- "speculative" -- investment. Energy Department officials said the bank set the rate, based on formulas including the payout length, and that Solyndra did not receive special treatment.
Word of the broadening probe came as the head of the Energy Department's loan program came before Congress at a contentious hearing on Capitol Hill Wednesday.
After spending months touting the Obama administration's decision to loan $535 million to Solyndra, top officials took a new tack Wednesday while testifying about the company's abrupt shut-down and bankruptcy: the loan, they said, was actually the Bush administration's idea.
The Energy Department's top lending officer told Congress that the Solyndra loan application was not only filed during President Bush's term, but it surged towards completion before Obama took office in January 2009.
"By the time the Obama administration took office in late January 2009, the loan programs' staff had already established a goal of, and timeline for, issuing the company a conditional loan guarantee commitment in March 2009," said Jonathan Silver, who heads the Energy loan program.
Even after the loan was restructured in 2011, the Energy Department and other administration officials continued to tout Solyndra's prospects.
In May, Silver told ABC News and iWatch News that questions about the loan guarantee were unfounded, and that Solyndra's canceled public offering and restructuring were hiccups that are typical for start-up companies.
"I have never seen a company go straight up without a bump along the way," Silver said. "I have no doubt they will continue to hire more people."
"If you guys think this is a bad idea, I need to unwind the W[est] W[ing] QUICKLY," wrote Ronald A. Klain, who was chief of staff to Vice President Joe Biden, in another email sent March 7, 2009. The "West Wing" is the portion of the White House complex that holds the offices of the president and his top staffers. Klain declined comment to ABC News.
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