Sept. 8 (Bloomberg) -- The FBI raided the headquarters of Solyndra LLC, the solar-panel maker that failed after receiving $535 million in loan guarantees from the Obama administration.
Republican lawmakers said after the raid that the administration made misleading claims about the company’s prospects, and Democrats said the company’s chief executive officer withheld information on its financial plight.
The Energy Department gave the Fremont, California-based company the most federal backing awarded a solar manufacturer. One of the principal investors in Solyndra is a foundation headed by billionaire George Kaiser, a campaign supporter of President Barack Obama who made 16 visits to the president’s aides since 2009, according to White House visitor logs.
The Federal Bureau of Investigation executed a search warrant today with the Energy Department’s inspector general, bureau spokeswoman Julie Sohn said in an interview. Sohn said she couldn’t provide details about the investigation. Solyndra filed for bankruptcy protection on Sept. 6 with liabilities of $783.8 million, after shutting its factory and firing 1,100 people.
“The FBI raid further underscores that Solyndra was a bad bet from the beginning and put taxpayers at unnecessary risk,” Representative Fred Upton, a Michigan Republican who heads the House Energy and Commerce Committee, said today in a statement. “President Obama’s signature green jobs program went from a darling of the administration, to bankruptcy, to now the subject of an FBI raid in a matter of days.”
‘Misleading Claims’
Investigations by the panel over six months produced “‘misleading claims on Solyndra’s viability by administration officials, company executives and congressional Democrats,” Upton said in the letter with Representative Cliff Stearns, a Florida Republican who heads the committee’s oversight panel.
Dave Miller, a Solyndra spokesman, and Debra Grassgreen, the company’s bankruptcy attorney with Pachulski Stang Ziehl & Jones LLP, didn’t immediately return calls seeking comment on today’s raid. White House spokesman Eric Schultz declined to comment on the raid, referring questions on law enforcement to the Justice Department and on loans to the Energy Department, which also declined to comment.
‘Rigorous’ Review
“Every project that receives financing through the Energy Department goes through a rigorous financial, legal and technical review process,” Schultz said.
Democratic Representatives Henry Waxman of California and Diana DeGette of Colorado said today that Solyndra Chief Executive Officer Brian Harrison assured them in a meeting less than two months ago that the company was in a “strong financial position.”
“He did not convey to us the perilous condition of the company, and the committee should know why,” Waxman and DeGette wrote in a letter today to Stearns.
“At that time, he said the company was projected to double its revenues in 2011, there was ‘strong demand in the United States’ for its shipments, and the company was expected to double the megawatts of panel production shipped this year,” according to the letter. “These assurances appear to contrast starkly with his company’s decision to file for bankruptcy.”
Testimony Sought
The committee today asked Harrison to testify at a Sept. 14 hearing on Solyndra in Washington.
“We smelled a rat from the onset,” Stearns and Upton said in a statement on Aug. 31, when the company announced its intention to file for Chapter 11 bankruptcy reorganization.
In a Sept. 1 letter requesting all documents on White House communications with Solyndra, its board and investors, they said “a major investor in Solyndra, George Kaiser, was a bundler for President Obama’s 2008 campaign.”
The George Kaiser Family Foundation, a charitable organization based in Tulsa, Oklahoma, and backed by donations from Kaiser, holds about 35.7 percent of Solyndra, according to a company filing with the Securities and Exchange Commission
Kaiser raised, or bundled, $50,000 to $100,000 for Obama’s 2008 campaign, according to a list that had been posted on Obama’s 2008 campaign website. He gave $2,300 personally, according to the Federal Election Commission.
White House Meetings
White House logs show that Kaiser had 16 meetings with Obama aides, 11 of them in 2009. His first recorded visit to the White House was March 12, 2009, when he met separately with Austan Goolsbee, a senior economic adviser to Obama, Pete Rouse, a senior adviser to the president, and Heather Higginbottom, deputy director of the Domestic Policy Council. The next day he met with Jason Furman, a member of Obama’s National Economic Council.
That month, the Energy Department awarded Solyndra the $535 million loan guarantee to commercialize its cylindrical solar panels.
In June, Kaiser met with senior Obama adviser Valerie Jarrett, policy adviser David Pope and Chief of Staff Rahm Emanuel. His most recent meeting covered by the White House logs was on April 11 of this year, with Rouse.
Christian Gronet, the chairman of Solyndra, met with Greg Nelson, from the White House office of public engagement on Sept. 22, 2009. The visits cited in the White House log were reported earlier today on the Daily Caller website.
‘Merit-Based Decisions’
The George Kaiser Family Foundation said in an e-mailed statement on Sept. 1 that Kaiser “is not an investor in Solyndra and did not participate in any discussions with the U.S. government regarding the loan.” The foundation said it “invests in a globally diversified portfolio across many different asset classes.”
Solyndra has said it failed because it couldn’t compete with larger rivals in other countries as prices for solar panels plunged and demand slowed.
The company borrowed $527.8 million from the U.S. Federal Financing Bank, a unit of the U.S. Treasury Department that’s its biggest lender.
In January, the Energy Department agreed to let $385 million in taxpayer support for Solyndra take a back seat to funds from new investors in an effort to keep the company operating.
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