FBI, EPA, Treasury Freeze Citibank Funds - Trump Climate Money

Federal Investigations Target Greenhouse Gas Reduction Fund

Citibank disclosed in recent court filings that multiple federal agencies – including the FBI, the Environmental Protection Agency (EPA), the EPA’s Office of Inspector General, and the Treasury Department – have requested account freezes related to several nonprofit organizations and state governmental bodies.

Account Freezes and Initial Disclosure

These account freezes were initially implemented in February. However, the newly released documentation reveals previously undisclosed specifics, notably a comprehensive list of the nonprofits currently under FBI investigation.

The Greenhouse Gas Reduction Fund

The funds in question were allocated through the $27 billion Greenhouse Gas Reduction Fund. This fund was established by the Inflation Reduction Act, legislation enacted by Congress in 2022.

Of this total, $14 billion was designated for the EPA’s National Clean Investment Fund, which provides grants to green banks.

Green Bank Operations and Funding

Green banks utilize these funds to facilitate financing for clean technology initiatives nationwide. Startups possessing commercially viable technologies were eligible for funding to bring their projects to fruition.

A primary objective of this funding model is to provide loans that are subsequently repaid and reinvested to support further lending activities. Delinquency rates within green banks are generally comparable to those observed in commercial and residential loan portfolios managed by traditional lenders.

Citibank's Role as Financial Agent

Citibank was chosen to serve as the financial agent responsible for administering these funds, maintaining accounts under the names of the grant recipients. The bank is also managing a separate $6 billion Clean Communities Investment Accelerator program.

The EPA’s contractual agreement with Citibank was made public in April 2024.

FBI Requests and Affected Entities

The FBI has requested Citibank to impose 30-day administrative freezes on accounts held by nonprofits that received funding from the green bank program. The agency also requested freezes on accounts belonging to other nonprofits and state agencies.

Entities impacted by these requests include Habitat for Humanity, United Way, the Colorado Clean Energy Fund, and the New York State Department of Taxation and Finance.

Legal Challenges

Three nonprofits that were awarded green bank funds have initiated legal action against Citibank, seeking the release of funds held in their accounts.

Concerns Raised by EPA Administrator

EPA Administrator Lee Zeldin has expressed that the Greenhouse Gas Reduction Fund does not align with the agency’s current priorities. He has also voiced concerns regarding potential fraud, although he has not yet presented supporting evidence.

Judicial Scrutiny

During a hearing on Wednesday, a judge in the U.S. District Court for the District of Columbia questioned a Justice Department attorney representing the EPA.

Judge Tanya Chutkan inquired, “Can you proffer any evidence that [the grant] was illegal, or evidence of abuse or fraud or bribery — that any of that was improperly or unlawfully done, other than the fact that Mr. Zeldin doesn’t like it?”

The judge further ordered the Justice Department to submit detailed information regarding the alleged fraud, stating, “because I don’t have the credible evidence that’s required.”

Update

Update 3/13/25: Details from the Wednesday hearing have been incorporated.