WASHINGTON—In a rare display of bipartisan unity, lawmakers from both the House and Senate came together for a joint hearing on April 9 to address the pressing need to protect American retirement savings from China’s predatory practices.
Lawmakers and experts expressed concerns over the rising financial aggression from China, including sophisticated scams run by Chinese gangs that disproportionately target elderly Americans and threaten U.S. national security.
One of the central issues highlighted during the joint session, held by the House Select Committee on the Chinese Communist Party and the Senate Special Committee on Aging, was the exploitation of American capital markets.
Sen. Rick Scott (R-Fla.), chairman of the Senate Committee on Aging, issued a stark warning during his opening remarks.
“If you have your retirement invested in anything that is controlled by or under the jurisdiction of the Chinese Communist Party, you are at risk of losing every dollar—and this could happen overnight,” Scott said.
The hearing highlighted ongoing violations of the Holding Foreign Companies Accountable Act, a law signed in late 2020 during President Donald Trump’s first term. Under the law, foreign companies must be delisted from U.S. stock exchanges if they fail to comply with U.S. auditing standards for three consecutive years.
Despite this mandate, Scott said, noncompliant Chinese giants like Alibaba, Baidu, and Yum China continue trading on U.S. exchanges.
Rep. John Moolenaar (R-Mich.) echoed similar concerns, accusing the Chinese Communist Party (CCP) of deliberately infiltrating U.S. capital markets.
“While some might see that as just another investment risk, it’s much more than that,” Moolenaar said.
He cited the 2021 collapse of stock prices in China’s private education sector after abrupt CCP regulations, impacting companies like TAL Education and New Oriental Education and Technology.
Pig Butchering Scams
Sen. Kirsten Gillibrand (D-N.Y.), ranking member of Senate Special Committee on Aging, highlighted the rise of international criminal networks operating primarily in China and Southeast Asia, which have increasingly targeted older Americans with sophisticated scams.“They are looking at our seniors like animals that they are fattening for slaughter,” Gillibrand said, referring to the so-called “pig butchering” scams.
Pig butchering is a type of scam in which the victim is gradually lured into investing in what appears to be a legitimate opportunity before the scammer disappears with the contributed funds.
In many instances, scammers pose as a family member or friend in urgent need of money, or they use fake identities to form romantic relationships with victims, often targeting older adults.
Rep. Raja Krishnamoorthi (D-Ill.) presented alarming examples of cyber scams carried out by Chinese gangs based in Southeast Asia—mainly in Burma and Cambodia—which collectively generate nearly $44 billion each year.
“This is not just a financial issue, it’s a human rights issue and a national security concern,” Krishnamoorthi said.
Brady Finta, former FBI agent and the founder of the National Elder Fraud Coordination Center, testified about the difficulty of tracking and prosecuting these transnational criminal organizations due to a lack of international cooperation and insufficient resources.
TikTok Is ‘Weapons-Grade Spyware’
Entrepreneur and investor Kevin O’Leary was among the experts who testified during the hearing. During his testimony, O’Leary criticized the lack of reciprocity in U.S.-China economic relations.“I have nothing against the Chinese people,” he said. “It’s their government I take issue with.”
He accused the Chinese regime of not playing by the rules of the World Trade Organization since joining the group in 2001.
O’Leary also highlighted issues such as “golden shares” in Chinese companies. These shares, typically equivalent to 1 percent, allow the CCP to have a seat on the board, voting power, and influence over corporate decisions.
He pointed to a similar concern with TikTok, alleging that Chinese leader Xi Jinping holds a golden share in the social media platform.
“TikTok is weapons-grade spyware. Period,” he said. “It’s one of the best propaganda machines I’ve ever seen.”
In January, O’Leary offered $20 billion in cash to buy the platform.
The future of TikTok in the United States is still uncertain because of persistent national security concerns, particularly the CCP’s influence over the app.
On April 4, Trump extended the deadline for TikTok to divest from its Beijing-based parent company, ByteDance, by 75 days to avoid a ban in the United States.
“My Administration has been working very hard on a Deal to SAVE TIKTOK, and we have made tremendous progress,” Trump wrote on April 4 on his social media platform Truth Social.
Trump also said that he could potentially use tariffs as a bargaining chip to get the Chinese regime to approve the sale of TikTok.
O’Leary said that ByteDance is an irrelevant party in the negotiations.
Role of Wall Street
The role of Wall Street in enabling the CCP’s financial aggression was also a key focus of the hearings.Chris Iacovella, president and CEO of the American Securities Association, said that for more than two decades, Beijing has used U.S. capital markets to fund its rise.
“Wall Street spins a narrative about emerging market returns and the China opportunity, then it sells Chinese companies to American investors on our exchanges,” he said, noting that investment banks make huge profits from facilitating the public offerings of these Chinese companies.
After the initial public offering, Iacovella said, “The money goes to China, and Wall Street continues propping up these companies.”
Wall Street also uses what he described as “the passive index loophole,” which allows these companies to be included in index funds.
“This loophole has funneled billions of dollars in American savings to Chinese companies, while allowing them to avoid all of the disclosure, financial reporting, and audit requirements American companies must comply with to sell stock to American investors,” Iacovella said.
The implications for national security are vast, as many of these companies are linked to the Chinese military or other state-run entities, Iacovella said. Additionally, many Americans are unknowingly funding the CCP’s human rights abuses by investing in these companies, Iacovella said.
Iacovella recommended that Congress take steps to ban these investments.
Scott noted that several proposals are being introduced in Congress to hold the CCP accountable, demand transparency, and safeguard vulnerable investors, especially seniors.
