Trump Administration Urges Citibank to Freeze Climate Funds Amid FBI, EPA, and Treasury Intervention
In a significant legal development, Citibank disclosed in recent court filings that multiple federal agencies, including the FBI, EPA, and the Treasury Department, have requested the bank to freeze accounts belonging to various nonprofits and state government agencies. This action raises concerns about the management of funds allocated for green initiatives.
Background on the Greenhouse Gas Reduction Fund
The accounts in question were frozen back in February, but the latest documents reveal crucial details that were previously undisclosed, including a comprehensive list of the nonprofits currently under FBI scrutiny.
Funding Allocations
The funds were part of the $27 billion Greenhouse Gas Reduction Fund, established by the Inflation Reduction Act of 2022. Out of this total, the EPA received $14 billion to support the National Clean Investment Fund, which offers grants to green banks.
- Green banks utilize these funds to finance clean technology projects across the nation.
- Startups with commercially viable technologies were eligible to receive financing for project implementation.
- The funding primarily aimed to provide loans, which are expected to be repaid and reinvested for future lending purposes.
Citibank’s Role in Fund Administration
Citibank has been appointed as the financial steward for administering these funds, managing accounts under the names of the respective awardees. Additionally, the bank is responsible for a separate $6 billion Clean Communities Investment Accelerator program, with its contract with the EPA formally announced in April 2024.
Account Freezes and Legal Action
In a recent request, the FBI urged Citibank to impose 30-day administrative freezes on the accounts of nonprofits benefiting from the green bank funding. This includes significant organizations such as Habitat for Humanity, United Way, and the Colorado Clean Energy Fund.
In response, three nonprofits that received funding from the green bank have filed lawsuits against Citibank, demanding the release of their frozen funds.
Concerns from the EPA
Lee Zeldin, the EPA administrator, expressed concerns that the Greenhouse Gas Reduction Fund does not align with the agency’s priorities and voiced apprehensions about potential fraud. However, he has yet to present any substantial evidence to support these allegations.
Judicial Inquiry
During a hearing on Wednesday, Judge Tanya Chutkan of the U.S. District Court for the District of Columbia questioned a Justice Department attorney about the absence of credible evidence regarding the alleged illegal activities associated with the grant.
“Can you proffer any evidence that [the grant] was illegal, or evidence of abuse, fraud, or bribery — other than the fact that Mr. Zeldin doesn’t like it?” Judge Chutkan inquired.
She also instructed the Justice Department to submit detailed information regarding the alleged fraud, stating, “because I don’t have the credible evidence that’s required.”
For ongoing updates on this case, stay tuned to our news section.
