by Ben Vernia | September 23rd, 2017
On September 22, the Department of Justice announced that SolarCity Corp. had agreed to pay $29.5 million to resolve civil allegations that arose from a federal investigation into the company’s claims for solar energy subsidy payments. According to DOJ’s press release:
The Justice Department announced today that SolarCity Corporation (SolarCity) has agreed to pay $29.5 million to resolve allegations that it violated the False Claims Act by submitting inflated claims on behalf of itself and affiliated investment funds to the U.S. Department of the Treasury (Treasury) pursuant to Section 1603 of the American Recovery and Reinvestment Act of 2009 (Section 1603). As part of the settlement, SolarCity and its affiliates will also release all pending and future claims against the United States for additional Section 1603 payments. SolarCity was purchased by Tesla Motors Inc. in November of 2016, after the alleged conduct at issue in this case.
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Under the Section 1603 Program, the Treasury paid a cash grant equal to 30 percent of the eligible cost basis to construct or acquire qualified renewable solar energy systems placed in service before Dec. 31, 2016. The Treasury required applicants to certify that each Section 1603 grant application accurately set forth the cost basis of the system, and that all supporting information was true, accurate, and complete.
Beginning in 2009, SolarCity submitted thousands of Section 1603 claims on behalf of itself and affiliated investment funds. The government alleged that SolarCity falsely overstated the cost bases of its solar energy properties in its certified Section 1603 claims to the Treasury and, as a result, SolarCity and its affiliated investment funds received inflated grant payments from the Treasury.
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