Politics in D.C. usually moves like molasses, but lately, things have been moving at breakneck speed. Honestly, it’s hard to keep up. One of the biggest shake-ups just hit the Department of Justice, and it involves a name you might not have heard of until now: Denise Cheung.
She wasn't just any lawyer. Cheung was the head of the criminal division at the U.S. Attorney’s Office in Washington, D.C. Then, she quit. Actually, she was basically forced out.
The whole mess started because of a massive pile of money—$20 billion, to be exact—and a very specific demand from the new administration. When Denise Cheung resigns over pressure to investigate Biden-era EPA funding, it isn't just another personnel change. It’s a signal of a much deeper war over how the government handles its checkbook and its legal power.
The $20 Billion "Gold Bar" Dispute
The drama centers on the Greenhouse Gas Reduction Fund (GGRF). This was a cornerstone of the Biden-Harris administration's climate plan, tucked inside the Inflation Reduction Act. The goal was to get money into the hands of nonprofits that would then fund green energy projects in low-income communities.
Shortly after the change in administration, Lee Zeldin, the new EPA Administrator, claimed he "found" $20 billion sitting in a Citibank account. He didn't just call it a budget line item; he compared it to "throwing gold bars" off the Titanic. The new leadership argued that the Biden administration had "parked" this money at a private bank right before leaving office to keep it out of the new president's reach.
The Trump administration wanted that money back. But there was a problem: the funds were already legally obligated to eight specific nonprofits. You can’t just click "undo" on a federal contract because you don't like the policy. To stop the flow of cash, they needed a legal reason. A criminal reason.
Why Denise Cheung Said No
This is where Denise Cheung comes in. As a veteran prosecutor who has served under multiple administrations since 2000, she knows the rules of the road. Her superiors—specifically acting Deputy Attorney General Emil Bove and the interim U.S. Attorney for D.C., Ed Martin—wanted her to sign off on a "freeze letter" to Citibank.
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This wasn't just a "please hold the phone" request. They wanted her to tell the bank that the Department of Justice had probable cause to believe a crime had been committed.
- The Problem: Cheung looked at the evidence and didn't see a crime.
- The Source: A lot of the administration's suspicion supposedly stemmed from an undercover video by Project Veritas.
- The Consensus: Cheung didn't just act on a whim. She checked with other senior white-collar prosecutors in her office. They all agreed: there wasn't enough evidence to meet the legal threshold for a grand jury investigation or a bank freeze.
Cheung was willing to send a softer letter stating that there might be conduct worth investigating. But Ed Martin wanted the "probable cause" language. In a phone call that reportedly got pretty heated, Martin accused her of wasting five hours "doing nothing" and just trying to get what she and the FBI wanted, rather than what the administration wanted.
When she refused to sign a document she believed lacked legal authority, Martin asked for her resignation. She gave it.
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The Fallout: A Justice Department in Turmoil
This resignation didn't happen in a vacuum. It’s part of a much larger "purge" or restructuring—depending on who you ask—at the DOJ. Just days before Cheung left, several top prosecutors in New York stepped down because they were told to drop charges against Mayor Eric Adams.
Cheung's departure is particularly sticky because she oversaw cases related to national security and the January 6 Capitol riot. Her replacement, Ed Martin, is a controversial figure himself. Before taking this role, he was a vocal supporter of the "Stop the Steal" movement and had defended Jan. 6 defendants.
What people are getting wrong: Some headlines make it sound like Cheung was just protecting Biden's legacy. But if you read her farewell email, it’s much more about the "oath of office." She told her colleagues to pursue justice "without fear or prejudice." To her, signing that letter without evidence wasn't just a policy disagreement—it was a violation of her ethical duties as a lawyer.
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What Happens to the Climate Money Now?
Right now, the $20 billion is in a sort of legal limbo. Even though a D.C. magistrate judge actually rejected a later attempt by Ed Martin to get a seizure warrant for the funds, the money remains effectively frozen.
Citibank is caught in the middle. The nonprofits that were supposed to use this money to build solar arrays or upgrade housing in poor neighborhoods are stuck. They have contracts, but they don't have the cash.
Key Takeaways for the Future
If you're following this story, here is what you should actually keep an eye on:
- The Inspector General Inquiry: Several Democratic senators, led by Sheldon Whitehouse and Ed Markey, have asked the DOJ Inspector General to investigate if the pressure on Cheung was an "unlawful weaponization" of the justice system.
- Contract Law vs. Executive Power: This will likely end up in a massive civil lawsuit. If the government tries to claw back money that was already legally awarded, it sets a wild precedent for every federal contractor in the country.
- Career vs. Appointee Rifts: Expect more departures. The tension between "career" employees (the ones who stay through every president) and "political appointees" (the ones who come in with the new guy) is at an all-time high.
Denise Cheung's resignation isn't just about the EPA. It’s about the very boring, very important rules of evidence. When a top prosecutor decides she’d rather lose her job than sign a piece of paper she doesn't believe in, it usually means the legal guardrails are being tested to their absolute limit.
If you are a business or nonprofit involved in federal grants, now is the time to double-check your "obligated" status. Ensure all documentation of your contract award is ironclad, as the "probable cause" bar for investigations is currently being used as a tool for policy reversals.