Peter Schweizer, best-selling author of “Secret Empires: How the American Political Class Hides Corruption and Enriches Family and Friends” and Jacob McLeod, a senior researcher with the Government Accountability Institute, explain Hunter Biden’s business dealings in China when his father was vice president.
The furor over Trump’s call for Ukraine to investigate Hunter Biden’s business has brought the spotlight back to the former second family’s international dealings.
While his Ukrainian business is currently receiving most of the attention, Hunter’s dealings in China deserve at least as much scrutiny.
Trained as a lawyer at Yale, Hunter had primarily worked as a lobbyist and consultant. His previous foray into financial services, Paradigm Global Advisors, was linked to Stanford Financial, a multibillion dollar Ponzi scheme.
In 2009, Hunter co-founded a new venture, Rosemont Seneca Partners. Rosemont and Hunter were given extraordinary opportunities in China while his father was vice president. Here are some key facts:
1. Joe Biden met with Hunter’s Chinese partners days before they established a new investment firm.
In December 2013, Hunter landed in Beijing aboard Air Force Two, accompanying his father on an official visit to China. Less than two weeks later, Hunter’s company, Rosemont Seneca, became a partner in a new investment company backed by the state-owned Bank of China.
Christening the new firm Bohai Harvest RST (BHR), the partners set out to raise $1 billion for the new fund.
Representatives of the Biden family have denied any connection between the vice president’s visit and Hunter’s business. However, a BHR representative told The New Yorker earlier this year that Hunter used the opportunity to introduce his father to Chinese private equity executive Jonathan Li, who became CEO of BHR after the deal’s conclusion.
2. BHR is a multibillion-dollar enterprise.
Exceeding their initial fundraising goal, the partners at BHR raised their target to $1.5 billion for the new fund. The company’s website now brags that it manages “over RMB 15 billion” in assets — the equivalent of about $2.1 billion in today’s dollars.
Under the terms of the deal, BHR, in which Hunter’s firm held an equity stake, would be a lead investor in the fund. Other investors include China Development Bank and China’s social security fund.
3. Hunter and his partners had prominent roles within the company.
Despite his relative lack of private equity experience, Hunter landed a prominent role with the new company. Under the terms of the original deal, Rosemont Seneca, Hunter’s firm, shared a 30% stake in BHR with the Thornton Group, which was run by James Bulger, the son of longtime Massachusetts state Senate President Billy Bulger. Hunter and Bulger joined the board, along with Devon Archer, Hunter’s longtime business partner. Archer would also serve as vice chairman of the fund’s investment committee.
The value of these partnerships to BHR is clear. Its own website boasts: “BHR, with its unique mixed ownership, combines the resources and platforms of China’s largest financial institutions … and the networks and know-how of our U.S.-based investment fund and advisory firm shareholders.”
Hunter Biden claimed to the New Yorker that he and his partners have not seen any money from the BHR deal. But even if true, the potential payouts are significant.
4. BHR represented a unique investment opportunity.
BHR’s relationships weren’t the only unique thing about the company. Rosemont Seneca was getting a piece of something that no other Western firm had: a private equity fund inside the recently established Shanghai Free-Trade Zone, with a focus on international acquisitions. With the backing of the state-owned Bank of China, one of the country’s “big four” financial institutions, BHR had access to the types of deals that most Western firms only dreamed of, including IPOs of state-owned companies.
5. BHR invested in strategically sensitive assets in both China and the United States.
In December 2014, BHR became an “anchor investor” in the IPO of China General Nuclear Power Company (CGN), a state-owned nuclear company involved in the development of nuclear reactors. Not only is CGN a strategically important company in China, it was also facing legal scrutiny in the United States. In 2016, CGN was charged with espionage by the Justice Department for stealing US nuclear secrets.
As a “cross-border” investment fund, Bohai Harvest was interested in making deals outside of China. In 2015, BHR acquired Henniges Automotive, a Michigan-based producer of vibration-dampening equipment, alongside Chinese military contractor Aviation Industry Corp. of China (AVIC). Given the military applications of Henniges’ technology, the deal required federal approval. Like CGN, AVIC was suspected of stealing US technology for its purposes.
Not long after the Henniges deal closed, AVIC debuted its new J-20 fighter — incorporating designs allegedly stolen from the US’ F-35 program.
6. It wasn’t an isolated incident.
In 2015, a state-backed real estate conglomerate acquired a controlling stake in Rosemont Realty, a sister company of Rosemont Seneca where Hunter served as an advisor. As part of the deal, the Chinese promised $3 billion for commercial office property acquisitions in the US — a major windfall for the company.
It wouldn’t be Hunter’s last episode with Chinese capital. In May 2017, he met with Ye Jianming, chairman of Chinese energy company CEFC, to discuss investment opportunities in the US. After the meeting, Ye sent a 2.8-carat diamond to Hunter along with a “thank you” card. When, six months later, a CEFC executive was arrested in New York on unrelated bribery charges, his first phone call was to Hunter’s uncle, James Biden. James told the New York Times that “he believed it [the call] had been meant for Hunter” and that “he had passed on his nephew’s contact information.”
Ye, now accused of bribing a Communist Party official, has since been detained in his native China.
All of this adds up to an extremely troubling pattern. Much of the media, as they so often do, have chosen to air the spin, rather than the facts, on this issue. Did the Chinese give favorable treatment to Hunter Biden to curry favor with his vice-president father? The American public deserves to understand what exactly Hunter Biden was doing overseas and the extent of then-Vice President Biden’s involvement.