Citibank has until March 15 to provide more information on orders to freeze funding. More details on that front were shared today, however, in a court filing in a lawsuit raised by Climate United—one of eight NCIF awardees whose funding was suddenly frozen.
In a motion opposing a request for a temporary restraining order forcing Citibank to unfreeze the funds, Citibank argued that it plays only an administrative role in managing accounts.
According to Citibank, it cannot be liable for freezing the funds because it’s legally required to follow instructions from the EPA and the Department of Treasury, and those agencies ordered Citibank “to pause all further disbursements from GGRF accounts, including those held by Climate United, until further notice.”
Citibank told the US district court that orders came to freeze the funding after “the government informed Citibank that the GGRF program was subject to an ongoing criminal investigation.”
Supposedly, the FBI received “credible information” that Climate United’s Citibank account was “involved in possible criminal violations,” allegedly including conspiracy to defraud the United States and wire fraud, Citibank’s filing said. In a footnote, Citibank said that it also “learned” that the EPA was “deeply” concerned about “matters of financial mismanagement, conflicts of interest, and oversight failures.”
So, freezing the funds was viewed as necessary, the filing alleged, to prevent “misuse of funds.” And Citibank claimed it had no authority to dispute “lawful” orders.
“Citibank is not vested with discretion to second-guess the government’s concerns regarding the ‘misconduct, waste, conflicts of interest, and potential fraud’ that the government has stated is occurring,” Citibank’s filing said.
Climate United, which describes itself as “a public-private investment fund that removes financial barriers to clean technologies,” said in a press release that freezing the funds had already harmed “hard-working Americans who are struggling to pay for groceries and keep the lights on.”
“Small businesses and developers are unable to draw committed funds for project expenses, critical programs are delayed or paused, and Climate United’s reputation as a lender is impacted,” Climate United said, rounding up stories from stakeholders already struggling through the freeze and urging, “this isn’t about politics; it’s about economics.”
