A Republican lawmaker urged California to fire a top pension fund official because he participated in a Chinese program that the FBI has called “non-traditional espionage against the United States.”
Rep. Jim Banks (R., Ind.) asked Gov. Gavin Newsom to investigate Yu Ben Meng, the chief investment officer at California Public Employees’ Retirement System (CalPERS), for his “long and cozy relationship” with the Chinese Communist Party. The letter also decried CalPERS’s investment in Chinese companies that built up the regime’s military presence in contested waters of the South China Sea and produced surveillance equipment used for China’s brutal crackdown in Xinjiang.
Recent Stories in National Security
“Governor Newsom, if it were up to me, I would fire Mr. Meng immediately,” Banks said in a letter to the governor. “At the least, I think a thorough investigation of Mr. Meng’s relationship to the Chinese Communist Party and a comparison of CalPERS investments in Chinese companies before and after Mr. Meng’s 2008 hiring are both warranted.”
CalPERS is the largest public pension fund in the country, controlling $370 billion in assets that provide retirement benefits to more than 2 million Californians and health care to 1.5 million members and their families. Meng, a China-born U.S. citizen, is in charge of the financial behemoth’s investment portfolio, which today retains billions of dollars’ worth of shares in Chinese companies. He worked at CalPERS for seven years until 2015 before being recruited by China’s Thousand Talents Program (TTP), a program widely accused of serving as an arm of Chinese spy agencies. He served as the deputy CIO of China’s State Administration of Foreign Exchange from 2015 to 2018. He returned to CalPERS in January 2019.
Meng’s ascent at CalPERS is the latest example of how TTP recruits have penetrated American institutions. A Senate report found that the program partnered with more than 7,000 “high-end professionals,” including many Nobel laureates, to give China an edge in the technology race. The program specifically instructed numerous researchers on its payroll to illegally deliver research funded by U.S. taxpayers to China while hiding its ties with Chinese institutions, according to the report. In response, the FBI started a crackdown on U.S. researchers participating in the program. Federal agents arrested the chair of Harvard University’s chemistry department for lying to law enforcement about his multimillion-dollar research partnership with TTP in January.
Meng was public about his fierce loyalty to China when he was participating in TTP. He told People’s Daily, the propaganda organ of the Chinese Communist Party, that his patriotic devotion to the regime convinced him to leave CalPERS in 2015.
“In a person’s life, if there is an opportunity to work for the motherland, this responsibility and honor is unmatched by anything,” Meng told the propaganda organ, according to a translation of the Chinese-language article included in the letter.
CalPERS CEO Marcie Frost told the Washington Free Beacon that Meng has “CalPERS’ full and unwavering support.” She added that the pension fund complies with all federal and state laws and that only 1 percent of the fund’s portfolio is Chinese public equities.
“CalPERS Chief Investment Officer Ben Meng, Ph.D. is a globally-respected financial expert and a proud citizen of the United States,” she said in a statement. “His commitment to California’s public servants is extraordinary and his integrity above reproach.”
CalPERS possessed shares in at least 172 Chinese companies with a total value of $3.2 billion in market value in 2018, according to the California Globe. Banks singled out several of these investments as objectionable, especially given CalPERS’s commitment to a socially conscious investment strategy. He criticized CalPERS for investing in companies such as Hikvision, which built the surveillance tools used in the crackdown in Xinjiang, as well as China Communication Construction Company, which constructed military bases in the South China Sea.
“CalPERS investments don’t just threaten America’s national security,” Banks wrote. “They bolster China’s ongoing human rights violations, including its genocide of Uyghur Muslims in Xinjiang Province.”
Newsom’s office did not respond to requests for comment.
Yuichiro Kakutani is a reporter at the Washington Free Beacon. He recently graduated from Cornell University, where he studied government and history. He previously served as editor for The Cornell Daily Sun. He’s a proud New Yorker — and by that he means, New York City. He can be reached at [email protected]