Solyndra CEO Home Was Part of FBI Raid: Is Brian Harrison Hiding Something?

 @EllenKilloran
on September 09 2011 2:50 PM
Obama tours a solar panel factory in Fremont, California
U.S. President Barack Obama lifts a solar panel as he tours Solyndra, Inc., a solar panel manufacturing facility in Fremont, California May 26, 2010. REUTERS

The Federal Bureau of Investigation's raid of Solyndra properties has reportedly expanded to the homes of executives.

The FBI raided the home of Solyndra CEO Brian Harrison on Thursday, the same day it searched the solar energy firm's Fremont, Calif., headquarters, The Washington Post reported.

The Center for Public Integrity's iWatch News reported on Friday that the homes of a founder and a former executive had also been visited by the FBI, which was examining computer files and documents.

Thursday's raid took place two days after Solyndra filed for bankruptcy and a week after it abruptly laid off 1,100 employees and closed its doors.

The sudden collapse of the firm, which manufactures photovoltaic solar panels, has drawn curiosity and criticism because Solyndra was given half a billion dollars in federal loan support in 2009, on the company's perceived promise of paving the path toward new job creation in the green energy sector --- making it the first to be allocated funds earmarked in President Barack Obama's stimulus package. The Treasury Department provided the loan, which was guaranteed by the Department of Energy.

The San Francisco Business Times reported Solyndra had drawn all but $8 million of the $535 million loan before filing for bankruptcy. Due to a loan restructuring this past winter, private investors who supplemented the federal loan will be the first in line to be paid $75 million under the bankruptcy terms, leaving the rest of the default burden on the shoulders of taxpayers.

Harrison is being called to testify at a congressional hearing Sept. 14.

Henry Waxman and Diana DeGette, both ranking members of the House Committee on Energy and Commerce, wrote in a letter to Cliff Stearns, chairman of the Subcommittee on Oversight and Investigations, requesting that Harrison be invited to testify at the hearing to investigate the loan guarantee, which Stearns had previously scheduled.

The letter, obtained by the San Francisco Business Times, argues that any thorough examination of the Solyndra loan guarantee should include the opportunity to ask Mr. Harrison about his representations. He did not convey to us the perilous condition of the company and the Committee should know why.

Eric Wesoff is an editor at Greentech Media, which has been covering Solyndra since 2008.

This is speculation, Wesoff wrote about the raid on Sept. 8, but it would appear that what the FBI is looking for is some evidence that Solyndra's CEO had knowledge of the firm's economic jeapordy even when he failed to mention this in his letters to Congress.

The most recent letter is dated July 13.

Nowhere in those letters does [Harrison] say 'we are a profitable company.' Wesoff told IBTimes. He said they were shipping product, and he was right.

Solyndra was indeed shipping product -- at a steady loss.

Both Wesoff and solar industry analyst Peter Lynch believe that Solyndra had been operating with an unsustainable business model from the start.

You make something in a factory and it costs $6, you sell it for $3, but you really, really need to sell it for $1.50 to be competitive, Lynch told The Washington Post. It was an insane business model. The numbers just don't work, and they never did.

It takes a lot of money to build a solar factory, Wesoff said. This may not have been the right company to give that money to.

 

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