The Vanguard Group, one of the world's largest asset managers, invests through index funds in Chinese military groups and companies linked to forced labor, according to a new report released as the U.S. Treasury Department is finalizing rules pertaining to a White House executive order that prohibits certain investments to China.
Vanguard's $70 billion flagship emerging markets index fund includes 60 companies on the Chinese military company sanction list by the Treasury Department's Office of Foreign Assets Control, the report released by the Coalition for a Prosperous America on Oct. 13 says.
Vanguard funds also hold shares of eight Chinese companies sanctioned over human rights abuses in China's Xinjiang region, where the persecution of Uyghurs has been identified by the U.S. State Department as "Genocide."
The report didn't provide a tally of all Vanguard investments in Chinese military companies but listed a total of $100 million in three such groups.
"Americans do not want firms like Vanguard and BlackRock to invest their retirement savings in companies building the Chinese Communist Party's military and implementing its ongoing genocide against the Uyghur people," he added.
Three months ago, the committee led by Mr. Gallagher opened an investigation into BlackRock, another leading asset manager, and global index provider MSCI over their role in channeling money to Chinese companies involved in building weapons for the Chinese military.
In a letter dated July 31 to BlackRock and MSCI, Mr. Gallagher and committee ranking member Rep. Raja Krishnamoorthi wrote that, through the companies' funds, Americans were "Unwittingly funding" Chinese companies that fuel the CCP's military and the two companies were "Exacerbating an already significant national security threat and undermining American values."
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