House Judiciary chair: Justice should probe Solyndra bankruptcy
By Carol D. Leonnig and Joe Stephens,
The chairman of the House Judiciary Committee has called for the Justice Department to appoint a special examiner to investigate the bankruptcy of a failed solar firm favored by the Obama administration.
Solyndra, a maker of solar panels, filed for bankruptcy protection early this month and shut its doors, laying off 1,100 workers and leaving taxpayers to repay a $535 million government-backed loan.
Rep. Lamar Smith (R-Tex.) wrote to Attorney General Eric H. Holder Jr. in a letter released Monday that taxpayers deserve to know why the Energy Department agreed in February to release more loan money to Solyndra — and put more taxpayer money at risk — when the company was on the brink of collapse.
As Solyndra executives confided that the firm had run out of cash, the Energy Department agreed to restructure its government-backed loan to the company. The agreement provided an emergency infusion of investor cash but also allowed Solyndra to continue receiving loan installments. The administration provided an additional $67 million to the company from February until it announced it was closing Aug. 31.
“An independent examiner is needed to shed light on the circumstances that led the DOE’s decision to extend, and later restructure, Solyndra’s loan,” Smith said in the letter. “An independent examiner will get to the truth of whether politics played a role in influencing the Obama administration to favor Solyndra over more financially stable loan applicants.”
Smith said that “recent reports” about Solyndra’s Chapter 11 filing “have raised suspicion about the extent to which the Obama Administration may have singled out Solyndra for special treatment . . . because of the president’s political relationship with one of the company’s major investors, George Kaiser.” Smith cited a Washington Post report.
Argonaut Private Equity is an investment vehicle for a nonprofit organization funded by Kaiser, a Tulsa billionaire and a major fundraiser for President Obama. Two funds tied to Kaiser controlled 39 percent of the Fremont, Calif., company. Another major investor, Madrone Capital, is associated with the family of Wal-Mart Chairman Rob Walton.
There are now at least four investigations into Solyndra, President Obama’s flagship example of his effort to spur clean technology projects and create new jobs: a joint probe by the Justice Department and the Treasury Department’s inspector general, and probes by the Energy and Treasury departments and the House Energy and Commerce Committee.
Justice spokeswoman Laura Sweeney said Monday, “We have received and are reviewing the letter.”
Also on Monday, ranking Democrats on the House Energy and Commerce Committee asked that investors in Solyndra be asked to testify at a hearing on Friday. The panel’s investigative subcommittee is already expecting to question the firm’s senior executives, including its chief executive.