Hunting Biden’s China Ties, The Wire China, Aug. 20, 2023.
By Aaron Mc Nicholas and Grady McGregor
Disentangling what is currently known about Hunter Biden’s dealings with Chinese entities.
As President Biden gears up for a heated re-election campaign, Republicans have seized on the financial entanglements of his son Hunter — some of which relate to companies and individuals in China. No evidence has emerged suggesting the president benefited financially from Hunter’s multimillion-dollar deals.
This week, The Wire disentangles what is currently known about Hunter Biden’s dealings with Chinese entities, including those with a multimillion-dollar investment fund and a defunct Chinese energy conglomerate whose billionaire founder has not been seen in public in more than five years. These details emerged from a now-famous laptop hard drive whose contents first became public in 2020 and have since been used in multiple congressional committee investigations led by Republicans.
JUST BUSINESS
Hunter Biden’s first known partnership with a Chinese entity started in 2013, when an investment and advisory firm he founded, Rosemont Seneca Partners, helped to launch a private investment fund with Tianjin-based private equity firm Bohai Industrial Investment Fund Management and several other shareholding companies. State-owned Bank of China is the controlling shareholder of Bohai, holding a 53 percent stake, according to data compiled by WireScreen. The new fund, BHR Partners, was capitalized with 30 million renminbi ($4.87 million) and by the end of 2015, had $1.75 billion of assets under its management, managing partner Xin Wang said in an interview with private equity intelligence firm Asian Venture Capital Journal.
Hunter Biden’s lawyer, George Mesires, later said that Hunter’s only involvement with BHR Partners during his father’s vice-presidency [from 2009 to 2017] was an unpaid position on the company’s board of directors, “which he joined based on his interest in seeking ways to bring Chinese capital to international markets.” In October 2017, after Joe Biden’s vice-presidency ended, Hunter invested $420,000 to acquire a 10 percent stake in BHR, Mesires added.
BHR Partners acquired U.S. automotive technology company Henniges Automotive in 2015 for $600 million in a joint venture with AVIC Auto, a subsidiary of the state-owned Aviation Industry Corporation Of China. The Committee on Foreign Investment in the United States (CFIUS), the U.S.’s inward investment screening body, approved the acquisition. That approval occurred before the U.S. flagged AVIC as a national security threat in 2020 for its role as a supplier to the People’s Liberation Army.
The acquisition became one of the first in a string of public controversies surrounding Hunter Biden when Senator Chuck Grassley (R-IA) raised concern in 2019 about the possibility that CFIUS came under political pressure to approve the transaction.
ENERGIZED MEETINGS
In February 2017, after Joe Biden’s vice-presidency ended, Hunter had his first known meeting with a central character in Republicans’ subsequent investigations: Ye Jianming. Hunter later told The New Yorker that he offered to use his contacts to help identify investment opportunities for Ye’s company, CEFC China Energy, in liquefied-natural-gas projects in the U.S.. Hunter duly began negotiating a deal for CEFC to invest $40 million in a project on Monkey Island, Louisiana.
Ye was chairman and executive director of CEFC China Energy, a private company that had played a pivotal role in striking oil deals in Africa and the Middle East and then transporting these resources back home through joint ventures with Chinese state-owned enterprises. Later in 2017, the head of CEFC’s Hong Kong-based subsidiary, Patrick Ho, was arrested in the U.S. on corruption charges for attempting to bribe the leaders of Chad and Uganda in exchange for oil deals on behalf of CEFC. In 2019, he was sentenced to three years in prison and has since been deported to Hong Kong.
While working on the Monkey Island deal, Hunter had agreed to offer legal services to Ho, an arrangement that netted Hunter a $1 million payment in March 2018, according to a Senate Homeland Security committee report. That same month, Ye Jianming disappeared from public view amid reports that he was under investigation for unspecified economic crimes.
Senator Grassley’s investigation also detailed significant transfers of funds between CEFC-affiliated entities and a business called Hudson West III. Owasco PC, a law firm managed by Hunter Biden, jointly owned Hudson West III together with Hudson West V, an entity in which Gongwen Dong, a business associate of Ye Jianming, served as president.
People are a lot more willing to believe that you’re up to no good if you’re getting entangled with Chinese interests than if you were getting entangled with Canadian interests or British interests.
On August 4, 2017, CEFC’s U.S.-based subsidiary sent Owasco a payment of $100,000, according to bank records obtained by Senator Grassley. Although the transaction record does not specify the purpose of the payment, the LLC agreement establishing Hudson West III, signed two days earlier, stated that Hunter Biden would be entitled to compensation of $100,000 per month for his role in identifying investment opportunities for CEFC.
Further transaction records show that Northern International Capital Holdings, a Hong Kong-incorporated energy company, sent a payment of $5 million to Hudson West III four days later on August 8. In 2015, Northern International had paid 123.46 million Singapore dollars ($92 million) for a 8.33 percent stake in CEFC International, making Northern International a substantial shareholder in the company. CEFC International was a Bermuda-incorporated company listed in Singapore whose chairman, Zang Jianjun, was also a senior executive at CEFC China Energy.
Over a 14-month period, much of this $5 million sum was transferred in $165,000 increments from Hudson West III to Owasco, according to the bank records Senator Grassley shared. This incremental amount corresponds to the $100,000 of compensation due to Hunter under the LLC agreement, as well as $65,000 for Hunter’s uncle, James Biden, who was also involved in Hudson West III’s formation.
In November 2018, with Ye Jianming missing from public view and Patrick Ho awaiting a verdict after his criminal trial, Hudson West III dissolved, according to records filed in Delaware’s corporate registry. Meanwhile, a Shanghai court declared CEFC China Energy and several of its subsidiaries bankrupt in a March 2020 ruling.
RECONCILIATION?
The congressional investigations into Hunter Biden have not focused exclusively on his ties to China. But in an atmosphere where taking a more aggressive approach to China has become one of the few issues of bipartisan consensus, Hunter’s Chinese business dealings have likely given the investigations more staying power.
“Finding business ties with China is an especially attractive thread to pull on for [congressional Republicans],” says David Hopkins, a political science professor at Boston College. “People are a lot more willing to believe that you’re up to no good if you’re getting entangled with Chinese interests than if you were getting entangled with Canadian interests or British interests.”
Will the Republicans’ push to investigate the son of the sitting President over alleged misconduct related to China affect China policy? How can it not?
In recent months, the Biden administration has taken a more conciliatory tone in attempting to rebuild diplomatic relations after years of escalating tensions. Treasury Secretary Janet Yellen and Secretary of State Antony Blinken both made recent visits to the country, and Commerce Secretary Gina Raimondo is planning her own visit in coming weeks.
But as the 2024 presidential election approaches, congressional focus and scrutiny into Hunter’s dealings in China will likely intensify. Some commentators believe that could influence the Biden administration’s approach towards Beijing.
“Will the Republicans’ push to investigate the son of the sitting President over alleged misconduct related to China affect China policy? How can it not?” says Steve Tsang, director of the SOAS China Institute at the University of London. “At the very least, it will make it think twice before taking any step that can be seen as ‘soft’ on China, thus reducing the flexibility in policy towards China.”