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Chairs Clyburn, Waters, Maloney Respond to Kodak Internal Report on Trump Administration’s $765 Million Loan and Windfall for Executives

Washington, D.C. (Sept. 17, 2020)—Today, Rep. James E. Clyburn, Chairman of the Select Subcommittee on the Coronavirus Crisis, Rep. Maxine Waters, Chairwoman of the Committee on Financial Services, and Rep. Carolyn B. Maloney, Chairwoman of the Committee on Oversight and Reform, issued the following statement in response to an internal report from Eastman Kodak Company lawyers regarding the Trump Administration’s proposed $765 million federal loan to Kodak to support the production of ingredients for generic drugs, as well as trading activity by company executives and board members before this loan was publicly announced:

“The report from Kodak’s lawyers raises more questions than it answers about the Trump Administration’s efforts to provide the company a $765 million loan to produce pharmaceutical ingredients despite Kodak’s lack of experience in the field, and about the windfalls gained by company executives and board members who traded Kodak securities before the public announcement of the loan.  Let’s be clear: this report does not represent the findings of any regulator; it is a report generated by a law firm hired by Kodak.  Kodak’s lawyers deny the company violated securities law, but the Securities and Exchange Commission must independently and carefully scrutinize this matter.  In addition, Kodak’s lawyers’ own report acknowledges ‘several flaws in the process’ and ‘significant concerns from a corporate governance perspective.’  The report also shows senior White House officials, including Assistant to the President Peter Navarro, were heavily involved in arranging the loan, contrary to recent efforts to distance the White House from this deal.  Our Committees plan to vigorously pursue our ongoing investigation into this matter, and we expect full cooperation from Kodak and the Administration.”

 

On August 4, 2020, the Chairs sent a letter to Kodak seeking documents and information regarding this loan, as well as trading activity by company executives and board members before this loan was publicly announced.  The Chairs, along with Foreign Affairs Committee Chair Eliot Engel and Chairman Al Green of the Financial Services Committee, Subcommittee on Oversight and Investigations, also sent a letter to Adam Boehler, Chief Executive Officer of the U.S. International Development Finance Corporation (DFC), seeking documents related to this loan.

On August 7, 2020 DFC announced in a tweet:  “On July 28, we signed a Letter of Interest with Eastman Kodak.  Recent allegations of wrongdoing raise serious concerns.  We will not proceed any further unless these allegations are cleared.”  Assistant to the President Peter Navarro responded:  “VERY disappointed last week’s great deal with Kodak tarnished by  allegations.  Absolutely RIGHT move by DFC!”

Also on August 7, 2020, Kodak announced it was launching an “internal review of recent activity by the Company and related parties in connection with the announcement of a potential loan” from DFC.

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