Friday, August 11, 2023

Republican Senators Warn of CCP Influence Over Proposed Acquisition of Forbes

Republican Senators Warn of CCP Influence Over Proposed Acquisition of Forbes

Sen. Tom Cotton (R-Ark.) speaks with reporters after attending a closed-door, classified briefing for Senators at U.S. Capitol Building in Washington on Feb. 14, 2023. (Anna Moneymaker/Getty Images) 

Two Republican senators are warning that companies with ties to America’s foreign adversaries, specifically Kremlin and the Chinese Communist Party (CCP), shouldn’t be allowed to buy Forbes.

In a letter to Treasury Secretary Janet Yellen on Aug. 8, Sens. Tom Cotton (R-Ark.) and Marco Rubio (R-Fla.) asked her to conduct a review of the planned Forbes acquisition “without delay,” saying that actions are needed to protect U.S. national security.

“The implications of allowing entities close to the Russian government and the CCP to own and operate an influential American media outlet are grave,” the senators wrote.

“Forbes reportedly holds a significant market share among younger Americans, with tens of millions of monthly users. This puts Forbes in a unique position to collect and store sensitive personal data on these populations and influence their opinions,” they added. “Further, foreign powers could use Forbes' wide reach to influence voters during close elections.”

For one thing, censorship would be at work, the senators wrote, pointing out the magazine’s recent stories on the CCP’s influence over the popular social media app TikTok and Beijing’s ongoing genocide against Uyghurs in the far-western region of Xinjiang.

“This reporting would undoubtedly be censored if Forbes is acquired by entities closely affiliated with the CCP,” the senators explained.

The planned acquisition of Forbes was announced in May. According to a press release, Austin Russell, the founder and CEO of Luminar Technologies, and Hong-Kong based Integrated Whale Media Investments entered into an agreement to acquire the majority ownership in Forbes Global Media Holdings at nearly $800 million. Mr. Russell would acquire 82 percent of Forbes.

Sen. Marco Rubio (R-Fla.) speaks during a press conference in the U.S. Capitol in Washington on July 11, 2023. (Madalina Vasiliu/The Epoch Times)
Sen. Marco Rubio (R-Fla.) speaks during a press conference in the U.S. Capitol in Washington on July 11, 2023. (Madalina Vasiliu/The Epoch Times)

'Masquerading as the Lead Buyer'

However, the senators argued that Mr. Russell was only a U.S. “surrogate,” who was “masquerading as the lead buyer of Forbes.”

“It is evident that Russell is merely a conduit for larger foreign investors, with Sun Group alone reportedly investing up to $300 million, nearly 40% of the capital for Forbes,” the pair wrote.

According to their letter, Sun Group, an investment firm with alleged close ties to both the Kremlin and the CCP, co-owned a Russian gold mine with China National Gold Group, an entity under the ownership of the CCP’s State Council.

“Looking at the voting stock of this proposed buyout, the amount that would be held by Russell, Sun Group, and Chinese nationals (all of whom are influenced by the PRC [People’s Republic of China] State Council) reportedly totals over 90% of the voting stock,” the senators said.

They added, “If this acquisition moves forward, the CCP's influence over Luminar, Russell, and Sun Group would translate into influence over Forbes.”

A Forbes spokesperson told Fox News, which first reported on the senators’ letter, that this "is not the first time outside interests have tried to drive false narratives about this deal."

"Austin is the sole decision maker in this acquisition, and he has all capital contractually committed with the majority being American," the spokesperson said. "If the Senators are interested in learning about the transaction, we would welcome the opportunity to meet with them."

The two senators noted in their letter that the CCP had tried to buy Forbes in 2022.

“Just last year, the CCP attempted to buy Forbes through Magnum Opus Acquisition Limited, a special-purpose acquisition company (SPAC). Fortunately, that effort was scuttled after the CCP’s involvement came to light,” according to the letter.

They ended their letter by saying that risks associated with the proposed Forbes deal “greatly exceed the acceptable level of risk established by Congress under the Foreign Investment Risk Review Modernization Act (FIRRMA) and by President [Joe] Biden under Executive Order 14083.”

President Biden signed the executive order in September last year, instructing the federal Committee on Foreign Investment in the United States (CFIUS) to more closely scrutinize foreign investments in areas that are deemed critical for the U.S. economy.

As Secretary of the Treasury, Ms. Yellen is the chairperson of CFIUS.

The Epoch Times has reached out to Mr. Russell for comment.

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