Representative Michael McCaul, who has harshly criticized China in his position as the ranking member on the House Foreign Affairs Committee, disclosed that his family owns stock in a Chinese tech company he described as a threat to national security.
In November, several months before the shares were purchased, the Texas congressman said that Tencent Holdings is among the “Chinese companies that threaten America’s economic and national security.”
The tech conglomerate is “heavily involved” in the “social credit system, a dystopian system China has implemented to score its citizens’ behavior,” McCaul said at the time, as well as an “integral part” of the Chinese Communist Party’s industrial policies and “one of four national champions for artificial intelligence.”
McCaul’s lawyer, Elliot Berke, said that the shares are not owned personally by McCaul but by his wife, and the decision to invest in Tencent was made by a third party.
“Congressman McCaul did not purchase any shares in China’s Tencent Holdings or any other Chinese company,” the attorney said. “Congressman McCaul’s wife has assets she solely owns and a third party manager made the purchase without her direction.”
Rachel Walker, a spokeswoman for McCaul, emphasized that the revelation of the Tencent shares “highlights that many Americans unwittingly invest their money in Chinese owned companies.”
Federal employees are often unaware they own such investments because the federal government’s thrift savings plan program creates portfolios that include Tencent and other Chinese companies, Walker said. McCaul has argued that such retirement investment plans should not invest American dollars in such “shady” Chinese companies, often without the knowledge of the investor.
“Congressman McCaul has been a fierce critic of the brutal behavior of the Chinese Communist Party and will continue to fight to hold them accountable as the Chair of the China Task Force,” Walker said. “This should be a wake-up call to us all that the CCP’s involvement in the U.S. economy is far more reaching than many Americans realize and that we need to change the way we do business with China, including our investments.”
Tencent owns the Chinese social media platform WeChat, which has more than one billion users and is suspected of monitoring the activities of users both inside and outside of China. Tencent is also associated with Chinese tech firm Huawei, which U.S. officials said can secretly access American cellular phone networks, giving it access to sensitive information.
McCaul has taken a leading role in criticizing China’s handling of the coronavirus pandemic as well, accusing Beijing of launching perhaps the “worst cover-up in human history.”
He was tapped on Thursday by House Minority Leader Kevin McCarthy as chairman of the China Task Force, the aim of which is to develop “legislative solutions to address the Chinese Communist Party’s malign global agenda.”
The task force will “develop new and enduring policy solutions that, among others, enhance our economic strength and create jobs, protect our national security, rethink our supply chains and grow our competitive edge in technology,” McCaul said in a statement on his appointment.