The $9 trillion asset manager BlackRock is being looked into by the US government for its interests in China.
According to politicians, American retirement money unknowingly support Chinese companies that the US has criticized for security and human rights violations. According to the WSJ, BlackRock and MSCI were informed of the investigations into their operations on Monday by the House of Representatives Select Committee on the Chinese Communist Party.
The investigation’s objective is to acquire information that can help guide American policies towards China, notably those pertaining to money flows. The U.S. corporations are “exacerbating an already significant national-security threat and undermining American values,” according to the letters, by channeling “massive flows of American capital” to such Chinese organizations.
The chairman of the subcommittee, Republican Rep. Mike Gallagher of Wisconsin, and its top Democrat, Rep. Raja Krishnamoorthi of Illinois, both signed these letters. The panel also notes that BlackRock has made more than $429 million in such Chinese companies across five ETFs.
BlackRock oversees an asset base of more than $9 trillion. The company is trusted by millions of Americans to manage their funds.
The company said in a statement that it had spoken with the committee directly to learn more about its issues.
The securities that make up the indexes that many investors use as the foundation for their portfolios are chosen by MSCI. More than $13 trillion worth of assets are measured against MSCI’s products. The company stated in a statement that it is examining the committee’s investigation. It has previously stated that it consults with numerous international market participants before making any decisions about its indexes. Just two weeks after the SEC approved BlackRock’s registration for the Spot Bitcoin ETF, the US Government opened an investigation into the company.
