U.S. lawmakers are accusing the Chinese government of using informants to infiltrate the Federal Reserve.
Republican members of the Senate Homeland Security and Governmental Affairs Committee reported last week that several Federal Reserve employees have had “close ties” to Chinese institutions, including the People’s Bank of China, or were asked to provide data on the U.S. economy.
The lawmakers’ report described the “sustained” Chinese targeting of the Fed as an attempt “to gain influence” and accused the Federal Reserve of failing “to combat this threat effectively.”
Although Federal Reserve Chairman Jerome Powell denounced the “insinuations” of the report as “unfair, unsubstantiated, and unverified,” one former employee of the Federal Reserve Bank of Minneapolis told Alpha News that Chinese nationals were allowed to roam about the Minneapolis Fed with “unrestricted access” for “years.”
The employee claimed that the Chinese nationals, who were international students at the University of Minnesota, had unfettered access to multiple rooms containing white boards with complex data and formulas written on them.
He added that Fed policy requires visitors to undergo background checks and have an escort throughout the building. However, those rules were not applied to Chinese students, he said.
In one instance, a Fed employee was threatened with imprisonment during a 2019 visit to Shanghai unless he “provided them with economic information and assistance,” according to the report.
Other employees purportedly tried to transfer “large volumes of data to an external site” and a “modeling code” to a university connected to the People’s Bank of China.
The Minneapolis Fed has also been accused of potentially violating federal law after allegedly using bank resources to help fund “grassroots lobbying activities” supporting the proposed “Page Amendment” to the Minnesota Constitution, which would guarantee a “quality education” for all Minnesota children with the aim of closing an “educational gap” between whites and minorities.
Alpha News reached out to the Federal Reserve Bank of Minneapolis but did not receive a response.