WASHINGTON — The Coalition for a Prosperous America (CPA) today, along with a diverse group of organizations, launched NoTSPforCCP.org, a website calling on the Federal Retirement Thrift Investment Board (FRTIB) to abandon its unconscionable plan to invest billions of dollars from the Thrift Savings Plan (TSP) — the retirement assets of federal government employees, active duty servicemembers, veterans, and retired civil servants — in companies controlled by the Chinese Communist Party (CCP). Victims of Communism Memorial Foundation, Center for Security Policy, Committee on the Present Danger China, Uyghur Human Rights Project, and Athenai Institute joined CPA in launching the website.
In June, the FRTIB will allow current and former federal employees to invest up to 25% of their savings in 5,000 new mutual funds that include CCP-controlled companies, barring White House or congressional intervention. Last month, CPA called on the FRTIB to abandon this plan, calling it economic treason to invest federal retirement dollars in China.
According to research conducted by CPA, within these mutual funds are at least 32 Chinese companies that are presently non-compliant with U.S. federal securities laws and sanctioned by the U.S. government for national security and/or human rights abuses. Despite repeated requests for information, the FRTIB has failed to vet the 5,000 new mutual funds for compliance with federal securities laws, protective disclosure requirements, or if any of the funds are owned or controlled by the CCP. Additionally, the FRTIB has made clear, in publicly available meeting minutes, that it has no intention of screening these mutual funds for the presence of Chinese companies, including U.S.-sanctioned and other Chinese corporate bad actors.
“The unelected bureaucrats at the FRTIB are once again attempting to invest federal retirement savings in opaque Chinese firms engaged in human rights abuses and a wide range of military-related activities,” said Zach Mottl, Chairman of CPA. “It is absolutely unacceptable for the Chinese Communist Party to be profiting from the retirement accounts of U.S. government employees and members of the military.”
In 2019, the FRTIB attempted to implement a similar plan. After bipartisan opposition in Congress, the White House, and the Secretary of Labor, the FRTIB announced in May 2022 that it would halt its short-sighted decision to invest billions of dollars from the TSP in opaque Chinese firms engaged in human rights abuses and a wide range of military-related activities. Senators Marco Rubio (R-FL) and Jeanne Shaheen (D-NH) led the staunch bipartisan opposition against the FRTIB.
Last month, Senators Marco Rubio (R-FL), Tommy Tuberville (R-AL), and Tom Cotton (R-AR) sent a letter to four of President Joe Biden’s nominees to serve on the FTRIB requesting that they commit to withholding the retirement savings of U.S. service members and other federal employees from Chinese firms that undermine U.S. national security. Rubio and Tuberville placed a hold on all four nominations pending confirmation of that commitment.
Unfortunately, current FRTIB leadership has refused to make public commitments to protect TSP participants against unwittingly investing in bad actor companies via the new mutual fund window. Additionally, due to the backsliding of governance via the rule-of-law in Hong Kong caused by the new CCP-mandated National Security Law, Hong Kong no longer affords the same financial and legal protections it once held. This means the TSP is now exposed to Chinese companies through Hong Kong and the FRTIB must also take urgent action to rectify this.
“A bipartisan group of lawmakers already rebuked the unelected bureaucrats at the FRTIB for attempting to invest federal retirement dollars in CCP-controlled companies,” said Michael Stumo, CEO of CPA. “Not only should the board abandon this misguided plan, but it should also conduct due diligence on every single one of these 5,000 mutual funds to ensure they are not setting up members of our military to unwittingly invest in Chinese companies supporting the PLA or committing other human rights and national security abuses.”