Does this look suspicious? Jim McElhatton writes in the Washington Times that Solyndra, one of the more prominent Green Scheme failures that the Obama administration funded with taxpayer money - and one closely tied to a huger donor to President Obama - may have allowed its investors to get a second bite of the apple. This is one bite that the taxpayers may have taken had it not been taken by Solyndra's investors first:
Fast running out of money, solar-panel maker Solyndra LLC last summer sold off nearly $60 million worth of inventory for less than $20 million in cash to a newly formed corporate entity closely tied to the company's biggest investors, records show.
Backed by $535 million in federal loan guarantees but burning through the little cash it had left, Solyndra made its first sale in late July to a corporate entity that had been formed just a day earlier. Three more transactions followed over the next few weeks with the same buyer, Solyndra Solar II.
By the time the last sale took place on Aug. 29 - two days before the company announced plans to file for bankruptcy - Solyndra had sold off a total of $58.1 million worth of inventory for $17.5 million, according to documents Solyndra attorneys filed last month in U.S. Bankruptcy Court in Delaware.
One prominent bankruptcy professor sees red flag waving in this "fire sale":
Todd Zywicki, bankruptcy professor at the George Mason University School of Law, said it's not unusual for troubled companies to sell off assets to improve liquidity. But he said the inventory sales figure cited by Solyndra - $58.1 million in inventory for $17.5 million in cash - seems unusual.
"The test under the bankruptcy code is whether the sale was for reasonably equivalent value and selling inventory at such a huge discount raises real concerns," he said. "If Solyndra Solar II is owned or controlled by any insiders or anything like that, then it becomes even more suspicious."
Were these assets sold to Solyndra's investors at a fire sale price-allowing them to benefit when these assets were sold later? If so, inquiring taxpayers would like to know. Hopefully, Congressman Darrell Issa and other Congressmen will seek to uncover the truth.
Taxpayers are on the hook for over 500 million dollars. If these assets were worth more than they were sold, Solyndra was stripped of valuable assets that should have been helped taxpayers recoup their losses instead of allowing Solyndra's existing investors to benefit from their ties - and the influence that came with them - to Solyndra.
Lest we forget, these investors were also able to "convince" the administration to give them priority rights over taxpayers in the event of Solyndra's bankruptcy - a priority that many believe violated federal law.