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Report: watchdog agency finds no wrongdoing in process for proposed Kodak loan

Top of Kodak Office Tower houses falcon nest box.
WXXI Photo
Top of Kodak Office Tower houses falcon nest box.

A government watchdog agency has found no wrongdoing in the process that led up to the announcement of a proposed loan to Eastman Kodak in the summer. The loan did not come to fruition after concerns about how the loan details came together.

According to the Wall Street Journal, Anthony Zakel, the inspector general of the U.S. International Development Finance Corporation, the agency that brokered the deal, found no evidence that employees of the agency had any conflicts of interest in the plans.

The proposed $765 million loan to Kodak was announced in July as part of the company’s plans to make ingredients used in generic pharmaceuticals. But questions were raised about the timing of the loan announcement; then the Securities and Exchange Commission and some congressional committees announced investigations which prompted the DFC to put the loan on indefinite hold.

Kodak also conducted its own internal probe, and that review found the company didn’t break any laws but did find some issues involving corporate governance.

Last month, Kodak CEO Jim Continenza said that the company still plans to move ahead with the pharmaceutical business, even if it doesn’t get the government loan.

Kodak released this statement on Monday: "Kodak is not in a position to comment on the scope or results of any DFC investigation. As previously reported, Kodak’s loan application is on hold and we will continue to move forward with expanding our existing pharmaceuticals business regardless of whether we receive the potential DFC loan."

Randy Gorbman is WXXI's director of news and public affairs. Randy manages the day-to-day operations of WXXI News on radio, television, and online.