Sept. 14, 2011  -- The Treasury Department's inspector general has opened a new front in the investigation of the government loan to Solyndra, the now bankrupt company that had been touted as a model of President Obama's ambitious green energy program, ABC News and the Center for Public Integrity/iWatch News have learned.

The new probe involves the $535 million loan, arranged by the Energy Department, but actually processed by the Federal Financing Bank, a government lending institution that falls under Treasury's control. Already, the FBI and the Energy Department's inspector general have executed search warrants at Solyndra's headquarters and questioned company executives.

"We're going to look at everything the FFB had to do with its role in this thing," Rich Delmar, a spokesman for the Treasury Department's inspector general, told ABC News and iWatch News.

Earlier this month, iWatch News and ABC News disclosed that Solyndra received a rock-bottom interest rate of 1 to 2 percent -- lower than those affixed to other Energy Department green energy projects. The low rate was set even as an outside agency, Fitch Rating, scored Solyndra as a B+ -- "speculative" -- investment. Energy Department officials said the bank set the rate, based on formulas including the payout length, and that Solyndra did not receive special treatment.

Word of the broadening probe came as the head of the Energy Department's loan program came before Congress at a contentious hearing on Capitol Hill Wednesday.

After spending months touting the Obama administration's decision to loan $535 million to Solyndra, top officials took a new tack Wednesday while testifying about the company's abrupt shut-down and bankruptcy: the loan, they said, was actually the Bush administration's idea.

The Energy Department's top lending officer told Congress that the Solyndra loan application was not only filed during President Bush's term, but it surged towards completion before Obama took office in January 2009.

"By the time the Obama administration took office in late January 2009, the loan programs' staff had already established a goal of, and timeline for, issuing the company a conditional loan guarantee commitment in March 2009," said Jonathan Silver, who heads the Energy loan program.

Even after the loan was restructured in 2011, the Energy Department and other administration officials continued to tout Solyndra's prospects.

In May, Silver told ABC News and iWatch News that questions about the loan guarantee were unfounded, and that Solyndra's canceled public offering and restructuring were hiccups that are typical for start-up companies.

"I have never seen a company go straight up without a bump along the way," Silver said. "I have no doubt they will continue to hire more people."

Republicans Push Back

Republicans pushed back hard against this version of events, unearthing internal Energy Department emails that indicate the panel evaluating the loans had made the unanimous decision to shelve Solyndra's application two weeks before Obama took office.

Blaming the failed loan on the Bush administration marked an abrupt turn for the Energy Department, which had championed the Solyndra loan as a model for its efforts to build a so-called "green energy" industry that creates jobs and safeguards the environment. The Solyndra loan was so central to this strategy that the administration initially planned to have Obama personally announce it, and later sent the president to the company's solar panel manufacturing facility in Fremont, California to celebrate its work.

The $535 million loan to Solyndra included a quarterly interest rate that is now at 1.025 percent, the government bank reported in July. Of 18 Energy Department loans cited in the bank's report, Solyndra's rate was lowest. Eight other Energy Department projects, each also backed by the Federal Financing Bank, came with rates three or four times higher, the report shows.

That treatment is in keeping with the history of the loan to the California solar panel maker, an arrangement inked in September 2009 with great fanfare. Monthly government bank reports filed since then reveal Solyndra's rate as the lowest for any energy-related project in nearly every report; in every case its rate was well below that of most energy projects, which ranged from cutting-edge electric car makers to wind and solar ventures.

Department of Energy officials said the rates for all of its green energy loans were set by the bank using a formula, and Solyndra's favorable terms were not the result of special treatment.

"All borrowers under the [government loan guarantee] program receive the same treatment," Energy Department spokesman Damien LaVera wrote to iWatch and ABC News in response to questions.

READ the Energy Department's Full Response

Solyndra spokesman David Miller agreed, saying that the interest rate was based on hard data -- such as when the loan was granted and the length of the repayment period. Solyndra's loan was for seven years, he noted, while other energy loans would have longer repayment periods. Miller pointed to a Treasury spreadsheet showing rates for 20- and 30-year loans are higher than those that are to be repaid in seven.

"It depends on the terms you negotiated," Miller said. "You'd have to look at each one of those other companies and see what their term was and that would probably explain to you what the difference would be."

But records show the advantageous terms came in spite of red flags about the risks of investing in Solyndra. In 2008, as the loan agreement was moving forward, an outside rating agency gave the deal with a B+ grade, a less than optimum score, according to records obtained by iWatch and ABC under the Freedom of Information Act. That same year, the records show, Dun & Bradstreet assigned the company's credit appraisal as "fair."

The path taken by Solyndra's application for a massive government loan was just one of several questions explored by members of the House Energy and Commerce Committee's investigative subcommittee Wednesday. Members grilled Silver and Jeffrey Zients, deputy director of the Office of Management and Budget, as to why the initial loan was approved, and why the Solyndra deal was restructured earlier this year. The restructuring came at a time when the company was already showing signs of financial stress, with Chinese competitors offering similar products for less money.

The House investigation into the matter had been underway well before the company collapsed. Federal auditors had already questioned the methods the energy department was using to analyze the loans. And beginning in March, ABC News, in partnership with the Center for Public Integrity's iWatch News, began reporting on simmering questions about the role political influence may have played in Solyndra's selection as the Obama administration's first loan guarantee recipient.

WATCH the Original ABC News Report on Solyndra

On Tuesday, some of the fruits of that investigation began to surface in anticipation of the hearing.

Emails uncovered by investigators for the House Energy and Commerce Committee showed that the Obama White House closely monitored the Energy Department's deliberations over the $535 million government loan, which was backed by an Obama fundraiser. The internal emails uncovered by investigators showed the administration was keenly monitoring the progress of the loan, even as analysts were voicing serious concerns about the risk involved.

"This deal is NOT ready for prime time," one White House budget analyst wrote in a March 10, 2009 email, nine days before the administration formally announced the loan.

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"If you guys think this is a bad idea, I need to unwind the W[est] W[ing] QUICKLY," wrote Ronald A. Klain, who was chief of staff to Vice President Joe Biden, in another email sent March 7, 2009. The "West Wing" is the portion of the White House complex that holds the offices of the president and his top staffers. Klain declined comment to ABC News.

Solyndra Was Central to Obama Green Strategy

Both administration officials and Energy Department officials pushed back on suggestions from Republican critics that politics could have influenced the process. They said emails released Tuesday only show that the White House was eager to have the president make the Solyndra announcement, and that a great deal of advanced planning work was underway to try and accomplish that. They said Kaiser made no effort to influence the process, and noted that several Solyndra executives were Republicans -- including its chief executive.

Democrats in Congress spent much of the Wednesday hearing voicing those key points.

"The documents and briefings that I've reviewed show that the Department of Energy in both the Bush and Obama administrations supported Solyndra's loan guarantee application," said Rep. Diana DeGette, a Colorado Democrat.

But with the company in bankruptcy and FBI agents investigating elements of the deal, some Democrats in the House were still raising doubts about the wisdom of the investment.

"We need to understand what happened, who should be held accountable, and how we can avoid future losses," said Rep. Henry Waxman, D.-Calif.

In April, after ABC News and the Center for Public Integrity aired the first in a series of reports on the Solyndra deal, Waxman was an early critic of the decision by House investigators to pursue the matter. He wrote a letter saying his own review had not uncovered "any information or documents that suggest any impropriety, wrongdoing, or favoritism in the award of the Solyndra loan guarantee."

But Wednesday, Waxman expressed displeasure with the sudden collapse of the company, especially after the company's CEO had just weeks earlier visited his office and personally vouched for the promise of the company.

"Well, these rosy scenarios were not realized," Waxman said. "Today we'll ask why. Is the reason unforeseen developments in the global marketplace, as Solyndra and DOE argue? Or is the reason sloppy or inadequate vetting, or worse yet, corporate malfeasance?"

As the hearing was underway, the Department of Energy was sending out emails to the press intended to convey that Solyndra was a bipartisan problem.

"At several points in the hearing, folks have pointed out the party affiliation of the private investors who lost a billion dollars of their own private capital on this deal," wrote Dan Leistikow, the department's director of public affairs. "Of the two major investment firms who risked and lost the most, one happens to be associated with a Democratic donor and one with a Republican donor. I frankly can't understand what that has to do with anything, but I suppose it's always good to see a little bipartisanship."

But Rep. Cliff Stearns, a Florida Republican, made note during the hearing that "the administration officials held out the company as a shining example of how the stimulus was creating jobs and invigorating the economy."

Indeed, when the loan was announced in March of 2009, Energy Secretary Chu issued his own press release, identifying Solyndra as "part of President Obama's aggressive strategy to put Americans back to work and reduce our dependence on foreign oil."

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