FIRST ON FOX – Consumers’ Research, an educational nonprofit that shares consumer information, sent a letter to 10 governors Thursday morning warning them of investment management firm BlackRock’s ties to China.
Will Hild, executive director of Consumers Research, sent the letter to the governors of Washington, Florida, New York, Nevada, South Carolina, Oklahoma, Pennsylvania, Montana, Nebraska and West Virginia—the 10 states with the top 10 investments in state pension funds with BlackRock – to “make American consumers aware of the fact that BlackRock is taking their money and betting on China.”
“BlackRock’s funneling billions of dollars in US capital into China poses risks not present in other markets, risks that threaten the company’s large bets on high returns from the Middle Kingdom,” Hild wrote.
“…Chinese companies are not held to the same transparency standards as their Western counterparts, so foreign investors often struggle to appreciate the true risk profile of what they invest in,” he added.
Hild urged governors to “do their due diligence by educating themselves and their staff on the multiple risks of BlackRock’s extensive investments in Chinese companies, both from an ethical standpoint and from the fiduciary responsibilities of U.S. pensioners and retirees.”
Consumers’ Research also issued a “Consumer Warning” Thursday morning highlighting some of BlackRock’s work in China, noting that the investment company, which manages approximately $10 trillion, first opened its Beijing office in 2008.
BLACKROCK RESPONDS TO SOROS’ CRITICS OF ITS INVESTMENTS IN CHINA
After introducing mutual funds in China, the company told its clients to invest in the country, pouring billions of dollars into the world’s second largest economy. It is the first foreign-owned asset management company based outside of China to receive approval from Chinese President Xi Jinping to start a mutual fund business in the country, the statement said. Reuters.
In 2020, amid the COVID-19 pandemic, BlackRock CEO Larry Fink said he continues to believe that “China will be one of the biggest opportunities for BlackRock in the long term, for asset managers and investors alike, despite the uncertainty and disconnection.” of global systems we see you today.”
While a good relationship with China can be lucrative for the company, Consumers’ Research says BlackRock “turns a blind eye to the CCP’s malicious behavior and worse, has sent US pensions to China to support it.”
LARRY FINK’S BLACKROCK TO TAKE ADVANTAGE OF GOVERNMENT ESG PUSH
“Despite China’s status as a major threat to US security, BlackRock has made significant capital investments in companies closely associated with the Chinese military,” the Consumer Warning reads. “BlackRock has demonstrated that its relationship with the CCP is more important than America’s national security interests.”
CHINA PLANS TO BAN US IPOS FOR DATA HEAVY TECH COMPANIES
While it is illegal for US investors to own direct shares of Chinese companies, “investors in BlackRock’s funds own shares of shell companies incorporated in places such as the Cayman Islands that have profit-sharing agreements with Chinese companies,” the Consumer Alert reads.
The warning also notes that under a 2017 Chinese law introduced by President Xi Jinping, the country’s companies must comply with government requests for information. In addition, Chinese companies are not subject to the same reporting requirements as US companies.
Consumers’ Research recommends retail investors with exposure to BlackRock to “consider the risks” associated with its services; BlackRock employees should consider contacting their human resources department to see if BlackRock manages their company’s 401(k) accounts or retirement funds; and those on state or municipal pensions contact government officials to do the same.
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The letter comes after the US-China Economic Security Review Commission released its annual report to Congress, acknowledging the “undeniable success” of the Chinese Communist Party in its 100th year of existence, but warning that “CCP- leaders publicly express confidence that China will prevail in an ideological and civilizational clash with the United States and other democracies.”
A summary of the report also acknowledges that China faces a number of economic challenges, including “growing debt, income inequality, demographic decline and technological dependence on the United States”.
BlackRock did not immediately respond to Fox Business’s request for comment.