Green energy firm Ecotality won plaudits from President Obama and Energy Secretary Steven Chu. It was supposed to build 15,000 electric-vehicle charging stations in 18 cities across America, a shining success of the economic stimulus and recipient of a Department of Energy grant.

Ecotality collected roughly $115 million in stimulus funding to manufacture these charging stations for electric vehicles. It secured another $26.4 million from the Department of Energy last October as part of the agency’s “Advanced Vehicle Testing and Evaluation project.”

Today, however, the San Francisco-based company is garnering attention in the nation’s capital for a different reason. Ecotality is under investigation by the Securities and Exchange Commission for insider trading. Investigative reporter Lachlan Markay, my colleague at The Heritage Foundation, outlined in a three-part series this week the scale of Ecotality’s problems and the ramifications for taxpayers who were left subsidizing a company that failed to accomplish its objectives.

In short, the company is waist-deep in a federal investigation. And yet the DOE decided to double down on its investment in Ecotality despite the ongoing SEC probe.

Meanwhile, the company is in dire financial straits. Ecotality stock is down almost 84% since May of 2010, and it now sits below a dollar per share. According to Forbes, the company has a five-year average return on invested capital of negative 210.2%.

Ecotality’s latest earnings report shows it posted a quarterly loss of nearly $3.4 million. Its Energy Department grant payouts, totaling $6.8 million, accounted for 60% of its revenues in the first nine months of 2011, up from 38% during the same time period in 2010.

But while DOE funds appear to be keeping Ecotality afloat, the project for which those funds were appropriated is stalling. The company was supposed to install 15,000 charging stations as part of the EV Project, but so far is less than halfway towards emething that goal.

Like so many of Obama’s bets on green technology, Ecotality relied on Washington’s largesse to stay afloat. Obama’s stimulus and the Department of Energy grant provided vital support, even as the company faced the SEC investigation. Without that critical government aide, Ecotality’s future now appears grim.

The SEC investigation has exposed the company’s financial and legal problems. In December, the SEC sent a subpoena to Donald Karner, former CEO of Ecotality North America. It sought all communications with 18 employees of and investors in Ecotality. Among those named: Ecotality CEO Jonathan Read, his daughter-in-law and her father, Kathleen and Gary Weinkauf, as well as Min Zhu and Yuqing Xu, owners of Zhu-Xu Charitable Remainder Trust and founders of the online communication company Webex.

These individuals helped Ecotality secure the taxpayer funding it needed to survive. Read played a significant role in landing federal subsidies and was rewarded handsomely for his work. Just as executives at bankrupt Solyndra were given sizable bonuses, Read saw his compensation increase more than 10-fold from 2008 to 2009. It rose from under $400,000 to more than $4.1 million, mostly due to stock awards.

Politics also played a role. Read’s son Colin was the assistant finance director for the 2006 congressional campaign of then-Arizona State Senator Harry Mitchell (D). Mitchell was elected to the U.S. House in 2006 and sat on two key committees related to Ecotality’s work. While in Congress, Mitchell requested federal funding to replace buses with plug-in hybrid electric vehicles in Tempe, AZ, where Ecotality had installed 19 charging stations.

As more information surfaces about Ecotality’s troubled history, Rep. Andy Harris (R-MD) has begun asking tough questions of the Department of Energy. He called the situation “an apparent major deficiency in Ecotality’s execution of its DOE award.”

Ecotality, meanwhile, becomes the most recent example of the federal government’s dubious policy of subsidizing electric vehicles.

Rob Bluey directs the Center for Media and Public Policy, an investigative journalism operation at The Heritage Foundation. Follow him on Twitter: @RobertBluey