IRS and Treasury Investigate Obama's SolarCity
News that SolarCity, another recipient of millions in government largess from the Obama Administration, would be issuing an IPO forced the disclosure that the IRS and the Treasury Department were now investigating the company, and others, for potential abuse of taxpayer funds.
The company, which received a subpoena in July from the Office of the Inspector General of the U.S. Department of Treasury to determine whether the company was part of a scam, inaccurately stated the fair-market value of their PV systems when applying for funds under the Treasury's Section 1603 cash-grant program.
Rumors of "misrepresentation" on 1603 applications have swirled since Solar Energy Industries Association President and CEO Rhone Resch alluded to such behavior -- and other ethically questionable practices cropping up in the solar sector -- at this year's Solar Power International conference.
"The Department of Justice could decide to bring a civil action to recover amounts it believes were improperly paid to us," SolarCity writes in its SEC filing. "If it were successful in asserting this action, we could then be required to pay damages and penalties for any funds received based on such misrepresentations."
The Obama Administration awarded the company a $275 million loan guarantee. In addition, it has been awarded millions in contracts to supply solar panels to military housing across the country.
Like Solyndra, the owners of SolarCity are donors to the Obama campaign and the Democrat National Committee.
It's not the first time. Elon Musk, the Chairman of the company, is not new to the Washington pay to play game. Musk has been able to parlay his donations to the Obama Administration into loan guarantees and grants. Musk made $600 million from his Tesla Motor company, which has received funds from the president.
Musk’s Tesla Motors spent $480,000 from 2007 to 2011 to lobby Congress, the White House, EPA and DOE on climate and energy issues, the Advanced Technology Vehicles Manufacturing loan program, the Promoting Electric Vehicles Act, and the Recovery Act. Tesla received a $465 million loan guarantee from DOE’s ATVM program.
Musk is also a generous political donor, mostly to Democrats, although his investments and giving are equally diverse. Also the CEO of a space exploration company, Musk donated $290,000 to political candidates and the major parties from 2008 through 2012, which included $66,200 to the Democratic National Committee, $34,400 to the Democratic Senatorial Campaign Committee, and $63,500 to the National Republican Congressional Committee. His presidential candidate was Barack Obama, giving $2,300 for his 2008 campaign and $5,000 for the 2012 cycle.
It remains to be seen what the Treasury Department and the IRS turn up in their investigation of SolarCity and the green energy industry. What is clear is that the Administration continues to make their cronies rich at the expense of the taxpayers.