White House to Review Energy Department Loans

Posted October 28th, 2011 at 9:00 pm (UTC-5)
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The White House has ordered an independent review of U.S. Energy Department loans after the solar panel company, Solyndra, received a half-a-billion-dollar federal loan guarantee then went bankrupt.

White House Chief of Staff William Daley Friday said the review of the Energy Department's loan program would be conducted by Herb Allison, a former Treasury Department official who helped the U.S. government during the financial crisis. The process is expected to take 60 days. Energy Secretary Steven Chu said he welcomed the White House review. In a statement, Chu said he directed his staff to make sure the department provides all necessary assistance and information.

The announcement came as the Energy and Commerce Committee in the Republican-controlled House of Representatives scheduled a meeting for next week to decide whether to subpoena White House documents on Solyndra. The Federal Bureau of Investigation, or FBI, is also investigating the loan guarantee to Solyndra.

Solyndra received the loan in 2009. In July, top executives testified to Congress that the company was prospering. But a few weeks later, the California-based company laid off more than 1,000 workers and filed for bankruptcy. The firm said it could not cut costs fast enough to keep up with Chinese solar panel makers.

One lawmaker compared the lost loan funding to a train robbery.

The case has been embarrassing for the Obama administration, which has held up the company as an example of desirable “green” technology and job creation.

Republicans have questioned whether Solyndra received the loans unfairly because one of its key investors was also a major donor to the 2008 Obama presidential campaign.