Commerce Secretary's Husband Is Top Executive at Tech Firm Funded by Chinese Government

[Happy New Year]

Gina Raimondo has major financial stake in AI firm funded by Chinese
venture capital firm

A venture capital firm backed by the Chinese government is a major
investor in an artificial intelligence company that counts Commerce
Secretary Gina Raimondo's husband as a top executive, a potential
conflict of interest as her agency works to counter China on the
world stage.

Danhua Capital, based in California but established with the
financial backing of the Chinese Communist Party, is one of the main
funders of PathAI, an artificial intelligence firm that employs
Raimondo's husband, Andy Moffit, as its chief people officer. Danhua
Capital has been invested in PathAI since at least 2017, when it
joined five other funders to contribute $11 million worth of seed
funding for the artificial intelligence startup. It is unclear how
much Danhua Capital has invested in PathAI, a private company, but
the Chinese firm lists PathAI on its website as one of its featured
"biotech and health" investments.

Danhua Capital was established and funded with the help of the
Chinese government as part of its "penetration of Silicon Valley,"
according to a 2018 Reuters report on the firm. The Center for a New
American Security (CNAS), a liberal think tank with former staffers
now in the highest ranks of the Biden administration, testified to
Congress in 2018 that Danhua Capital's mission is to use its capital
to narrow the technology gap between China and the United States.

Neither Raimondo nor PathAI responded to requests for comment on
Danhua Capital's investment. As commerce secretary, Raimondo is
tasked with managing the U.S. business relationship with countries
across the globe, and she has emerged as one of the most pro-China
voices in the administration. In a September Wall Street Journal
interview, Raimondo said the United States should strengthen
economic ties with China, arguing "robust" commercial engagement
with China would "mitigate any potential tensions" with the global
rival.

The Wall Street Journal reported on Friday that Raimondo's agency
was pushing back on efforts by others in the Biden administration to
block Chinese technology firms from working with American companies.
Commerce officials are arguing internally, according to the report,
that the administration's tougher approach to China would hurt U.S.
companies.

Raimondo said on Thursday she would not urge U.S. companies to pull
sponsorships from the upcoming Beijing Olympics after President Joe
Biden announced a diplomatic boycott of the games over human rights
abuses. "What individual companies do is entirely up to them,"
Raimondo said. "We’re not going to pressure them one way or
another."

Raimondo's ethics agreement to serve in the Biden administration
bars her from participating in any matter that could have a "direct
and predictable effect on the financial interests of PathAI."
Raimondo's financial disclosure forms show she would greatly benefit
from the company's success. In addition to an annual salary, Moffit
was given a significant number of ownership shares in the company as
well as stock options. The value of the nearly 200,000 shares is not
ascertainable, according to the disclosure form.

In 2018 testimony titled, "China’s Threat to American Government and
Private Sector Research and Innovation Leadership," Elsa Kania, an
adjunct fellow at CNAS, told Congress that Danhua Capital is
directly tied to the Chinese government. In Kania’s testimony, she
said Danhua Capital is open about its plans to narrow the gap
between America and China when it comes to technological
development. "According to its cofounder, the fund is committed to
‘narrowing the gap’ in technological development between China and
the U.S.," she wrote.

Multiple senior CNAS staff from the time of Kania's testimony now
serve in top roles in the Biden administration. Kania’s former
colleagues from CNAS include Colin Kahl, Ely Ratner, and Victoria
Nuland—all of whom now occupy top roles in the State Department and
Defense Department.

Subsequent testimony in the Senate Small Business Committee from
Robert Atkinson, the president of the Information Technology and
Innovation Foundation, warned that Danhua Capital is used by Beijing
to exert its influence overseas.

"Zhongguancun Development Group, a state-owned enterprise
headquartered in Beijing has set up ‘Danhua Capital' to promote the
strategy of ‘Zhongguancun Capital going global and bringing in
overseas advanced technology and talents,’" Atkinson said.

PathAI has received funding from Danhua Capital across multiple
years. In 2017, Danhua Capital joined investors in bringing PathAI's
total capital raised to $15 million. In 2019, the company raised at
least $60 million, and Danhua Capital was again listed as an
investor.

Raimondo’s Commerce Department has also provided a lifeline to
Huawei, a company closely tied to China’s brutal repression of its
Muslim Uyghur population. In August, the Commerce Department
approved license applications for Huawei to buy hundreds of millions
of dollars worth of chips for its growing interest in the automobile
industry.

Raimondo is not the only Biden administration official with family
ties to the Chinese Communist Party, which complicates a planned
diplomatic boycott of the upcoming Winter Olympics hosted by China.

Republican senators recently called for climate czar John Kerry to
resign or be fired by Biden after the Washington Free Beacon
reported that Kerry and his wealthy heiress wife have at least a $1
million stake in a Chinese firm that funds China's artificial
intelligence sector—including a company blacklisted in America
because it aids China in its human rights abuses against the
Uyghurs.


https://freebeacon.com/biden-administration/commerce-secretarys-
husband-is-top-executive-at-tech-firm-funded-by-chinese-government/