The United States International Development Finance Corporation is putting its deal with Eastman Kodak on hold following allegations of insider trading.

On July 28, the DFC signed a letter of intent with Kodak for a $764 million loan to start a drug ingredient-making business as part of the Trump administration’s response to the pandemic.

However, the DFC announced on Twitter Friday it will not proceed any further unless the allegations are cleared.

The House of Representatives confirmed it will investigate the Kodak pharma deal. The announcement came after the SEC also committed to an investigation.

Senator Elizabeth Warren called for the SEC inquiry. 

Three Democratic committee chairs, including Caroyln Maloney of New York, Jim Clyburn, and Maxine Waters, requested information into the federal loan that was to launch Kodak into the generic drug-making market.

They wrote Kodak Executive Chair Jim Continenza and Adam Boehler, the CEO of the International Development Finance Corporation, and asked for documents and other details from the deal.

Kodak stock skyrocketed on the news, including stock options approved for Continenza, the day before the announcement.

Friday, Kodak announced it is appointing a special committee to oversee an internal review of recent activity by the company and related parties.

Continenza had applied for the options, two months before the deal closed. 

One expert says the investigation is going to hit stockholders.

"This would've been a big deal for Eastman Kodak, and certainly it was a big enough deal to cause thousands of investors all over the country to buy the stock," said George Conboy of Brighton Securities. "Those investors are likely to be very disappointed on Monday when the shares open. Because unless this news gets reversed in 48 hours, a lot of investors may find their stock opening a lot lower Monday morning."

The deal was expected to bring 300 jobs to Rochester and another 60 to St. Paul, Minnesota.

“Although securities insider trading investigations aren’t uncommon, they can often take months to conduct. And that could be an issue for Kodak, because Kodak as a company has struggled for several years,” Conboy said.

For all interested parties and Rochester, he says everyone will just have to hope the investigation moves along quickly.

“Now it’s become a waiting game. Before, the wait was how quickly can Kodak get the capital and build out new infrastructure? Now it becomes how quickly can an investigation be concluded, and at the end of it, will the federal government still make that loan?” Conboy said.

Spectrum News reached out to Kodak for a response.

The company said it did not have a comment.