38 Studios avoids federal criminal charges

38 Studios avoids federal criminal charges
Craig Chapple

By Craig Chapple

October 1st 2012 at 11:00AM

But Rhode Island investigation continues

No federal criminal charges will be brought against 38 Studios after its closure left Rhode Island on the hook for at least $75 million.

As reported by The Washington Post, US Attorney Peter Neronha said that after a narrow and focused review of the Kingdoms of Amalur developer to see if any laws had been broken – such as whether it had provided false statements or information -  no further federal action was planned.

The head of the Rhode Island State Police Steven O’Donnell said however that its own investigation was still underway.

“It’s still being pursued and we follow all leads that are presented to us,” he said.

Despite filing for bankruptcy in June, there is still uncertainty surrounding whether Rhode Island will have to repay bonds used to fund the $75 million loan given to 38 Studios. The State could have to pay upwards of $100 million after interest and other fees.

Rhode Island Governor Lincoln Chafee recently said the developer’s closure remained an “economic crisis” for the state, and was considering making sweeping changes to the State’s economic development system.

A report commissioned by the Governor recommended the creation of a new State office to oversee broader economic policy and development.

Rhode Island is currently the only New England State without such an office.

"38 Studios was and remains an economic development crisis for the state of Rhode Island," said Chafee

"I will continue to digest the report over the coming weeks as my administration works to put in place the best structure for sustained and long-term business growth."