Senior prosecutor in Washington resigns, citing pressure to investigate Biden-era climate funds
Denise Cheung’s exit occurs as Trump aims to promote interim U.S. Attorney Ed Martin to a permanent position in the office.
TroibNews 
A federal prosecutor in Washington, Denise Cheung, resigned on Tuesday after refusing to comply with a directive from Justice Department leaders to instruct a bank to freeze accounts containing $20 billion in climate change funds earmarked by former President Joe Biden’s climate spending legislation.
Cheung, the leader of the criminal division at the U.S. Attorney’s Office in Washington, indicated in her resignation letter that officials from the Trump administration pressured her to initiate a criminal inquiry without adequate evidence. The Environmental Protection Agency (EPA), during the Biden administration, had transferred the funds to Citibank the previous year to support nonprofit initiatives aimed at curbing climate pollution.
In her letter, Cheung noted that interim U.S. Attorney Ed Martin demanded her resignation after she declined to order the freeze of the funds, even though it was asserted that a criminal investigation was in progress. She emphasized that such an action is only justified if there is "probable cause" to suspect criminal activity.
“When I explained that the quantum of evidence did not support that action, you stated that you believed that there was sufficient evidence,” Cheung wrote in a three-page letter addressed to Martin, which was acquired by PMG. “I still do not believe that there is sufficient evidence to issue the letter you described.”
While Cheung’s letter does not specify the agency or bank involved, a Justice Department official, who spoke on the condition of anonymity, confirmed that the situation pertains to a $20 billion EPA grant initiative concerning climate change. This incident represents one of the more significant outcomes arising from President Donald Trump’s long-held commitment to halt Biden’s extensive climate and clean energy funding.
In a statement, a Justice Department spokesperson described Cheung’s refusal as an act of defiance that should not be praised. “Refusing a basic request to pause an investigation so officials can examine the potential waste of government funds is not an act of heroism — just a failure to follow chain of command,” the statement read.
Cheung’s resignation adds to the list of recent exits from the Justice Department amid claims that leadership has attempted to politicize criminal proceedings. Other departures include members of the DOJ’s Public Integrity Section and the Manhattan federal prosecutor's office after demands arose for the dismissal of corruption allegations against New York City Mayor Eric Adams.
Cheung's resignation also highlights broader instability within the Justice Department, including the abrupt firing of prosecutors involved in January 6 investigations and controversies over the intentions for the thousands of FBI agents and staff who worked on those cases.
The Trump administration has been active in trying to stop funding from the Democrats' influential climate legislation, which includes a prominent grant initiative aimed at mitigating emissions—an undertaking criticized by the administration as a slush fund meant for liberal advocacy organizations.
Cheung described a growing crisis within her office after being tasked with assessing documents provided by the acting No. 2 official at the Justice Department, Emil Bove. According to Cheung, Bove’s office was seeking to initiate a criminal investigation into whether an executive agency had unlawfully awarded a contract prior to the administration change and to issue grand jury subpoenas in relation to this investigation.
“I was told that there was time sensitivity and action had to be taken that day because there was concern that contract awardees could continue to draw down on accounts handled by the bank handling the disbursements,” Cheung explained in her letter.
Discussing the evidence, Cheung consulted with colleagues who have significant experience in white-collar crime prosecution, concluding that the documentation available “on their face” did not substantiate a criminal investigation.
The FBI, collaborating with Cheung, ultimately sent a letter to the bank “recommending” a freeze of the contract funds. However, Cheung noted that Martin expressed “dissatisfaction” that the letter only recommended a freeze rather than commanded it.
“You also directed that a second letter be immediately issued to the bank under your and my name ordering the bank not to release any funds in the subject accounts pursuant to a criminal investigation,” Cheung conveyed to Martin, explaining that this directive prompted her resignation.
EPA Administrator Lee Zeldin informed reporters that he had spent the previous weekend reviewing the $20 billion program, known as the Greenhouse Gas Reduction Fund, established by the Inflation Reduction Act passed in 2022. This fund was transferred to Citibank last year to support green lending initiatives administered by various nonprofits, enabling investments in renewable energy, building upgrades, and electric vehicle infrastructure.
"I spent my weekend reviewing the financial agent agreement between Treasury and the bank on the $20 billion that were sent… and the more I read, the more I was growing increasingly concerned over how it was purposefully put into writing that the EPA would tie its hands behind its back," Zeldin remarked.
Regarding possible criminal allegations related to the program, Zeldin referred inquiries to the DOJ.
Last week, Zeldin called for the immediate termination of the arrangement and demanded the return of the funds from Citibank.
He also referenced an undercover video from December, in which an individual identified as an EPA adviser compared the Biden administration’s approach to spending climate funds prior to Trump’s inauguration to “throwing gold bars” off the Titanic. Cheung’s letter appears to mention this video, recorded by a conservative organization.
Although the EPA moved quickly to allocate IRA funds near the conclusion of the Biden administration, the $20 billion in grants was finalized well before Trump took office, indeed before the November elections. The law required the EPA to commit the funds by September 30, 2024, which the agency accomplished. Vice President Kamala Harris and then-EPA Administrator Michael Regan announced the grant recipients in an event in North Carolina last April.
Citibank did not comment on Tuesday about whether it would follow the FBI’s recommendation for “a thirty-day administrative freeze on certain assets,” as described by Cheung.
The greenhouse gas fund, while still relatively new, has already disbursed hundreds of millions of dollars to grant recipients. Because the funds are held by Citibank, the $20 billion allocation has not been impacted by other ongoing freezes of IRA funds by the EPA.
EPA had not previously used such a financial agent agreement to distribute funds; however, according to Zealan Hoover, who supervised IRA implementation at the EPA under Biden, similar structures have been in use by the Treasury Department and other agencies for years. Establishing the money in an accessible bank account allowed lenders to leverage substantial private investments, and the EPA collaborated with the Treasury to arrange the deal.
Hoover pushed back on assertions that the financial structure was created to limit oversight, arguing that the EPA possesses detailed transaction-level knowledge of all the money.
In a separate email to her colleagues, Cheung announced her resignation without referencing her disagreement with Martin or the pressures she faced. “I took an oath of office to support and defend the Constitution, and I have executed this duty faithfully during my tenure, which has spanned through numerous Administrations,” she stated, encouraging her colleagues to “fulfill your commitment to pursuing Justice without fear or prejudice.”
Spokespeople for the U.S. Attorney’s office in Washington have not yet responded to requests for comment.
Cheung’s resignation, initially reported by CNN, occurs as Trump aims to make Martin the permanent U.S. Attorney. Martin, who played a role in the pro-Trump 2020 “Stop the Steal” efforts and has publicly discussed investigations, oversaw the dismissal of numerous January 6 cases shortly after Trump took office, straying from Justice Department guidelines on commenting about ongoing investigations.
Annie Snider contributed to this report.
Camille Lefevre for TROIB News
Cheung, the leader of the criminal division at the U.S. Attorney’s Office in Washington, indicated in her resignation letter that officials from the Trump administration pressured her to initiate a criminal inquiry without adequate evidence. The Environmental Protection Agency (EPA), during the Biden administration, had transferred the funds to Citibank the previous year to support nonprofit initiatives aimed at curbing climate pollution.
In her letter, Cheung noted that interim U.S. Attorney Ed Martin demanded her resignation after she declined to order the freeze of the funds, even though it was asserted that a criminal investigation was in progress. She emphasized that such an action is only justified if there is "probable cause" to suspect criminal activity.
“When I explained that the quantum of evidence did not support that action, you stated that you believed that there was sufficient evidence,” Cheung wrote in a three-page letter addressed to Martin, which was acquired by PMG. “I still do not believe that there is sufficient evidence to issue the letter you described.”
While Cheung’s letter does not specify the agency or bank involved, a Justice Department official, who spoke on the condition of anonymity, confirmed that the situation pertains to a $20 billion EPA grant initiative concerning climate change. This incident represents one of the more significant outcomes arising from President Donald Trump’s long-held commitment to halt Biden’s extensive climate and clean energy funding.
In a statement, a Justice Department spokesperson described Cheung’s refusal as an act of defiance that should not be praised. “Refusing a basic request to pause an investigation so officials can examine the potential waste of government funds is not an act of heroism — just a failure to follow chain of command,” the statement read.
Cheung’s resignation adds to the list of recent exits from the Justice Department amid claims that leadership has attempted to politicize criminal proceedings. Other departures include members of the DOJ’s Public Integrity Section and the Manhattan federal prosecutor's office after demands arose for the dismissal of corruption allegations against New York City Mayor Eric Adams.
Cheung's resignation also highlights broader instability within the Justice Department, including the abrupt firing of prosecutors involved in January 6 investigations and controversies over the intentions for the thousands of FBI agents and staff who worked on those cases.
The Trump administration has been active in trying to stop funding from the Democrats' influential climate legislation, which includes a prominent grant initiative aimed at mitigating emissions—an undertaking criticized by the administration as a slush fund meant for liberal advocacy organizations.
Cheung described a growing crisis within her office after being tasked with assessing documents provided by the acting No. 2 official at the Justice Department, Emil Bove. According to Cheung, Bove’s office was seeking to initiate a criminal investigation into whether an executive agency had unlawfully awarded a contract prior to the administration change and to issue grand jury subpoenas in relation to this investigation.
“I was told that there was time sensitivity and action had to be taken that day because there was concern that contract awardees could continue to draw down on accounts handled by the bank handling the disbursements,” Cheung explained in her letter.
Discussing the evidence, Cheung consulted with colleagues who have significant experience in white-collar crime prosecution, concluding that the documentation available “on their face” did not substantiate a criminal investigation.
The FBI, collaborating with Cheung, ultimately sent a letter to the bank “recommending” a freeze of the contract funds. However, Cheung noted that Martin expressed “dissatisfaction” that the letter only recommended a freeze rather than commanded it.
“You also directed that a second letter be immediately issued to the bank under your and my name ordering the bank not to release any funds in the subject accounts pursuant to a criminal investigation,” Cheung conveyed to Martin, explaining that this directive prompted her resignation.
EPA Administrator Lee Zeldin informed reporters that he had spent the previous weekend reviewing the $20 billion program, known as the Greenhouse Gas Reduction Fund, established by the Inflation Reduction Act passed in 2022. This fund was transferred to Citibank last year to support green lending initiatives administered by various nonprofits, enabling investments in renewable energy, building upgrades, and electric vehicle infrastructure.
"I spent my weekend reviewing the financial agent agreement between Treasury and the bank on the $20 billion that were sent… and the more I read, the more I was growing increasingly concerned over how it was purposefully put into writing that the EPA would tie its hands behind its back," Zeldin remarked.
Regarding possible criminal allegations related to the program, Zeldin referred inquiries to the DOJ.
Last week, Zeldin called for the immediate termination of the arrangement and demanded the return of the funds from Citibank.
He also referenced an undercover video from December, in which an individual identified as an EPA adviser compared the Biden administration’s approach to spending climate funds prior to Trump’s inauguration to “throwing gold bars” off the Titanic. Cheung’s letter appears to mention this video, recorded by a conservative organization.
Although the EPA moved quickly to allocate IRA funds near the conclusion of the Biden administration, the $20 billion in grants was finalized well before Trump took office, indeed before the November elections. The law required the EPA to commit the funds by September 30, 2024, which the agency accomplished. Vice President Kamala Harris and then-EPA Administrator Michael Regan announced the grant recipients in an event in North Carolina last April.
Citibank did not comment on Tuesday about whether it would follow the FBI’s recommendation for “a thirty-day administrative freeze on certain assets,” as described by Cheung.
The greenhouse gas fund, while still relatively new, has already disbursed hundreds of millions of dollars to grant recipients. Because the funds are held by Citibank, the $20 billion allocation has not been impacted by other ongoing freezes of IRA funds by the EPA.
EPA had not previously used such a financial agent agreement to distribute funds; however, according to Zealan Hoover, who supervised IRA implementation at the EPA under Biden, similar structures have been in use by the Treasury Department and other agencies for years. Establishing the money in an accessible bank account allowed lenders to leverage substantial private investments, and the EPA collaborated with the Treasury to arrange the deal.
Hoover pushed back on assertions that the financial structure was created to limit oversight, arguing that the EPA possesses detailed transaction-level knowledge of all the money.
In a separate email to her colleagues, Cheung announced her resignation without referencing her disagreement with Martin or the pressures she faced. “I took an oath of office to support and defend the Constitution, and I have executed this duty faithfully during my tenure, which has spanned through numerous Administrations,” she stated, encouraging her colleagues to “fulfill your commitment to pursuing Justice without fear or prejudice.”
Spokespeople for the U.S. Attorney’s office in Washington have not yet responded to requests for comment.
Cheung’s resignation, initially reported by CNN, occurs as Trump aims to make Martin the permanent U.S. Attorney. Martin, who played a role in the pro-Trump 2020 “Stop the Steal” efforts and has publicly discussed investigations, oversaw the dismissal of numerous January 6 cases shortly after Trump took office, straying from Justice Department guidelines on commenting about ongoing investigations.
Annie Snider contributed to this report.
Camille Lefevre for TROIB News
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