US cracking down on foreign acquisitions as Kushner touts influence to attract Chinese

UPDATE — 7/27, 8:00 p.m. EDT: The sale of new White House communications director Anthony Scaramucci’s hedge fund company SkyBridge Capital to a Chinese acquisitions firm, agreed to in January, is still under review by a government review board chaired by the Treasury Department.

While Scaramucci said Friday that he has been working with the Office of Government Ethics to ensure no conflict-of-interest rules are violated, financial disclosure forms filed with OGE reveal the New York financier will earn almost $100 million in pre-tax profits from the sale.

 

Reuters reported Thursday an inter-agency committee of the U.S. government has recommended blocking a record number of foreign proposed buy-outs of American companies in 2017, indicating a hardened stance by the White House against non-allied developing countries like China.

The Committee on Foreign Investment in the United States (CFIUS) is headed by the Treasury Department, but also includes seats for the State, Defense, Homeland Security and Commerce departments, as well as 11 other federal agencies.

Since January 2017, CFIUS has blocked at least nine potential Chinese acquisitions on the grounds of national security risks, with most of the nixed deals being proposed technology company buys. Eighty-seven U.S. companies have been successfully acquired by Chinese businesses in 2017, 10 more than in mid-July 2016.

Potential Chinese buy-outs of U.S. firms currently under review by CFIUS include, semiconductor testing company Xcerra Corp., wire transfer company MoneyGram International Inc., microchip-maker Lattice Semiconductor Corp., and life insurance company Genworth Financial Inc.

Earlier this year two American firms announced they were pulling their CFIUS proposals to sell assets to foreign entities, including a California-based electronics company which had sought to unload its WiFi division to a Chinese smartphone business.

Following the revelation by anonymous government sources, CNN reported Thursday that President Trump’s son-in-law, Jared Kushner, is continuing to use his new-found political influence to attract Chinese investors for a family-owned real estate development project.

Two advertisements written in Chinese by immigration-investor firms were found posted online that refer to Kushner Companies and Jared Kushner himself with the intention of securing $500,000 investments in a 79-story apartment complex in Jersey City in-exchange for U.S. visas under the EB-5 program.

Both ads, one by the Florida-based U.S. Immigration Fund in May, the other from a Chinese company in March, have since been removed following CNN’s expose.

“What is not authorized is any arrangement where someone gets preference for their visa if they give money to a company that is controlled by the family of a United States government official,” said former President George W. Bush’s ethics adviser Richard Painter. “That implication was made in the selling efforts for this project.”

A spokesperson for Kushner Companies responded by saying that the advertisements in question were not authorized by the real estate firm and that the company would send “a cease and desist letter” regarding the use of Jared Kushner’s name.

 

[Reuters] [CNN] [Politico]