Attorney General Steve Marshall joined a coalition of 17 attorneys general in demanding answers from the world’s top asset managers to determine if they are misrepresenting and omitting essential disclosures regarding Chinese investments.
In a letter sent Thursday to BlackRock, StateStreet, Invesco, JPMorgan, Goldman Sachs, and Morgan Stanley, the attorneys general raise concerns that the asset managers appear to be misrepresenting and concealing the risks of Chinese investments to their investors, especially as China is a foreign adversary of the United States and even so BlackRock and other asset managers imply investing in China has similar risks to investing in other countries.
“Asset managers have a duty to be transparent with their investors, not to obscure the significant risks posed by investments in a foreign adversary. The Chinese Communist Party’s market interference, human rights abuses, and geopolitical threats are not just abstract concerns—they directly impact the financial security of American investors,” Attorney General Steve Marshall said. “We will not allow Wall Street firms to prioritize access to China over their legal and ethical obligations to their clients.”
In addition to concealing the risks associated with investing in a foreign adversary of the United States, BlackRock also fails to disclose China’s intention to invade Taiwan and when its funds rely on investments that could be ruled illegal at any time by the Chinese Communist Party (CCP). Additionally, BlackRock refers to China’s Uyghur forced labor and genocide as “religious and nationalist disputes” rather than calling it as it is, according to the attorneys general.
Marshall and the attorneys general noted that the CCP is actively suppressing accurate information and manipulating stocks. Instead of disclosing that information to shareholders, BlackRock implies that the quality of Chinese audits is simply not up to U.S. standards. Further, while China emits more CO2 emissions than the United States, Europe and Japan combined and engages in genocide of Uyghurs, flagrantly violating ESG principles, BlackRock’s Environment, Social, Governance (ESG) letter grade for its all-China fund is the same for its U.S. small-cap stocks fund.
The attorneys general assert that either the asset manager's misstatements and omissions are a result from a conflict of interest from the intense pressure China places on firms seeking access to Chinese investors or stem from an inability to investigate the facts accurately, given interference and distortion from the Chinese Communist Party. To aid in potential ongoing investigations, Attorney General Marshall is demanding the asset managers answer questions regarding their Chinese investments by March 10.
Attorneys general from Idaho, Indiana, Iowa, Kansas, Mississippi, Missouri, North Dakota, Oklahoma, Ohio, South Carolina, South Dakota, Texas, Virginia, West Virginia and Wyoming also joined the letter led by Montana Attorney General Austin Knudsen.
Click here to read the letter.
BlackRock disputed the coalition of attorneys general and responded on X.
To connect with the author of this story or to comment, email caleb.taylor@1819News.com.
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