Category Archives: government fraud spending collusion

K -14 Free Education? Not so Much

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Obama to propose $2.5 billion community college tax credit

TheHill: President Obama on Tuesday will propose a $2.5 billion tax credit over five years for businesses that invest in local community colleges and hire their graduates, administration officials told Reuters.
The Community College Partnership Tax Credit, which will be formally proposed in the president’s fiscal 2017 budget, would give employers who invest in schools and hire students from such programs a one-time $5,000 tax credit per individual.
“Employers can define those skills and help colleges develop the curriculum that teaches them,” James Kvaal, White House deputy director of domestic policy, told Reuters.
The administration estimated the initiative would help train 500,000 highly skilled workers over five years.
Ted Mitchell, under secretary at the Department of Education, said the proposal would receive bipartisan support.
“The idea of … bringing together community colleges and the local employer base is a very powerful one and really doesn’t break along party lines,” he said.
Under the president’s proposal, states would get a portion of the tax credit and be responsible for choosing which businesses and community colleges participate in the program.
The administration believes the program will spur employers to propose curriculums uniquely tailored to their labor needs.

FACT SHEET – White House Unveils America’s College Promise Proposal: Tuition-Free Community College for Responsible Students

Nearly a century ago, a movement that made high school widely available helped lead to rapid growth in the education and skills training of Americans, driving decades of economic growth and prosperity. America thrived in the 20th century in large part because we had the most educated workforce in the world.  But other nations have matched or exceeded the secret to our success. Today, more than ever, Americans need more knowledge and skills to meet the demands of a growing global economy without having to take on decades of debt before they even embark on their career.

Today the President is unveiling the America’s College Promise proposal to make two years of community college free for responsible students, letting students earn the first half of a bachelor’s degree and earn skills needed in the workforce at no cost. This proposal will require everyone to do their part: community colleges must strengthen their programs and increase the number of students who graduate, states must invest more in higher education and training, and students must take responsibility for their education, earn good grades, and stay on track to graduate. The program would be undertaken in partnership with states and is inspired by new programs in Tennessee and Chicago. If all states participate, an estimated 9 million students could benefit. A full-time community college student could save an average of $3,800 in tuition per year.

In addition, today the President will propose a new American Technical Training Fund to expand innovative, high-quality technical training programs similar to Tennessee Tech Centers that meet employer needs and help prepare more Americans for better paying jobs. These proposals build on a number of historic investments the President has made in college affordability and quality since taking office, including a $1,000 increase in the maximum Pell Grant award to help working and middle class families, the creation of the $2,500 American Opportunity Tax Credit, reforming student loans to eliminate subsidies to banks to invest in making college more affordable and keeping student debt manageable, and making available over $2 billion in grants to connect community colleges with employers to develop programs that are designed to get hard-working students good jobs.

The President’s Plan: Make Two Years of College as Free and Universal as High School

By 2020, an estimated 35 percent of job openings will require at least a bachelor’s degree and 30 percent will require some college or an associate’s degree. Forty percent of college students are enrolled at one of America’s more than 1,100 community colleges, which offer students affordable tuition, open admission policies, and convenient locations.  They are particularly important for students who are older, working, need remedial classes, or can only take classes part-time. For many students, they offer academic programs and an affordable route to a four-year college degree. They are also uniquely positioned to partner with employers to create tailored training programs to meet economic needs within their communities such as nursing, health information technology, and advanced manufacturing.

The America’s College Promise proposal would create a new partnership with states to help them waive tuition in high-quality programs for responsible students, while promoting key reforms to help more students complete at least two years of college. Restructuring the community college experience, coupled with free tuition, can lead to gains in student enrollment, persistence, and completion transfer, and employment. Specifically, here is what the initiative will mean:

Enhancing Student Responsibility and Cutting the Cost of College for All Americans: Students who attend at least half-time, maintain a 2.5 GPA while in college, and make steady progress toward completing their program will have their tuition eliminated. These students will be able to earn half of the academic credit they need for a four-year degree or earn a certificate or two-year degree to prepare them for a good job.

Building High-Quality Community Colleges: Community colleges will be expected to offer programs that either (1) are academic programs that fully transfer to local public four-year colleges and universities, giving students a chance to earn half of the credit they need for a four-year degree, or (2) are occupational training programs with high graduation rates and that lead to degrees and certificates that are in demand among employers.  Other types of programs will not be eligible for free tuition.  Colleges must also adopt promising and evidence-based institutional reforms to improve student outcomes, such as the effective Accelerated Study in Associate Programs (ASAP) programs at the City University of New York which waive tuition, help students pay for books and transit costs, and provide academic advising and supportive scheduling programs to better meet the needs of participating students, resulting in greater gains in college persistence and degree completion.

Ensuring Shared Responsibility with States: Federal funding will cover three-quarters of the average cost of community college. States that choose to participate will be expected to contribute the remaining funds necessary to eliminate community college tuition for eligible students. States that already invest more and charge students less can make smaller contributions, though all participating states will be required to put up some matching funds. States must also commit to continue existing investments in higher education; coordinate high schools, community colleges, and four-year institutions to reduce the need for remediation and repeated courses; and allocate a significant portion of funding based on performance, not enrollment alone. States will have flexibility to use some resources to expand quality community college offerings, improve affordability at four-year public universities, and improve college readiness, through outreach and early intervention.

Expanding Technical Training for Middle Class Jobs. Additionally, in order to spread the availability of high-quality and innovative programs like those in Tennessee and Texas, which achieve better than average completion and employment outcomes, the President is also proposing the American Technical Training Fund. This fund will award programs that have strong employer partnerships and include work-based learning opportunities, provide accelerated training, and are scheduled to accommodate part-time work. Programs could be created within current community colleges or other training institutions. The focus of the discretionary budget proposal would be to help high-potential, low-wage workers gain the skills to work into growing fields with significant numbers of middle-class jobs that local employers are trying to fill such as energy, IT, and advanced manufacturing. This program will fund the start-up of 100 centers and scale those efforts in succeeding years. Smaller grants would help to bring together partners and start a pilot program. Larger grants would be used for expanding programs based on evidence of effectiveness, which could include past performance on graduation rates, job placement rates and placement wages. Building on the President’s community college initiative, known as the Trade Adjustment Assistance Community College and Career Training Grants and for which 2014 was the final year of funding, these funds will help community colleges become more job-driven.

Building on State and Local Programs.  In the past year, Tennessee and the City of Chicago initiated free community college programs.  In the first year of the Tennessee program, 57,000 students representing almost 90 percent of the state’s high school graduating class applied for the program. The scholarship is coupled with college counseling, mentorship, and community service that early evidence suggests supports greater enrollment, persistence and college completion.  This is coupled with efforts to spur innovation and improvement by funding colleges using performance outcomes based on student success and an innovative approach to career and technical education through the Tennessee Colleges of Applied Technology.  These Tennessee Tech Centers have a graduation rate of 80 percent and a job placement rate of 85 percent.

Building on a Record of Progress. Since taking office, President Obama has taken steps to expand federal support to help more students afford college, while calling for a shared responsibility in tackling rising college costs. Key achievements include:

  • Doubling the Investment in Pell Grants: The President has raised the maximum Pell Grant award to $5,730 for the 2014-15 award year — a nearly $1,000 increase since 2008. The number of Pell Grant recipients has expanded by 50 percent over that same time.
  • Expanding Education Tax Credits: President Obama established the American Opportunity Tax Credit in 2009 to assist families with the costs of college, providing up to $10,000 for four years of college tuition.
  • Pay-As-You-Earn Loans: All new borrowers can now cap loan payments at 10 percent of their incomes. The Department of Education has begun the process to amend its regulations and will make the new plan available on all direct loans by December 2015. We expect it to benefit up to 5 million borrowers.
  • First in the World Grants: In September, the Department of Education awarded $75 million to 24 colleges and universities under the new First in the World grant program to expand college access and improve student learning while reducing costs.
  • College Ratings Program: The Department of Education continues to develop a college ratings system by the 2015-2015 school year that will recognize institutions that excel at enrolling students from all backgrounds; focus on maintaining affordability; and succeed at helping all students graduate with a degree or certificate of value.
  • Job-Driven Training Grants: Through the Trade Adjustment Community College and Career Training program more than 1,000 institutions have received $2 billion in federal funding to design education and training programs, working closely with employers and industry that prepare workers for jobs in-demand in their regional economies, such as health care, information technology and energy. These programs have shown early success — through the end of FY2013, among the nearly 164,000 individuals who had enrolled in these programs 88 percent either completed a program or continued the program into a second year.
  • White House Summit on Community Colleges: In October 2010, the President convened community college leaders, faculty and students; business leaders; philanthropic organizations; and other workforce development experts for the first White House summit dedicated to the role that community colleges play in our efforts to increase the number of college graduates and prepare those graduates to lead the 21st century workforce.
  • Center for the Analysis of Postsecondary Readiness: Last August, the Department of Education launched a new $10 million Institute for Education Sciences-funded Center for the Analysis of Postsecondary Readiness (CAPR) that is working to strengthen the research, evaluation, and support of college readiness efforts across the nation. CAPR is documenting current practices in developmental English and math education to identify innovative instructional practices that improve student success.
  • Call to Action on College Opportunity: Last December, the President, Vice President, and First Lady joined college presidents and leaders of non-profits, foundations, and other organizations to announce over 600 new commitments to produce more college graduates. Community colleges made commitments individually, and in partnership with neighboring school districts and four-year institutions, to build seamless transitions among institutions, develop clear educational and career pathways, implement strategies to increase student completion of STEM programs, and establish more accurate measures of student progress and success.

Spooky Dude Behind Migrants and Benefits

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United States Programs via Open Society Foundation, George Soros:

The Open Society Foundations’ U.S. Programs is committed to building a vibrant, inclusive, and more just society in the United States. Through grant making, the Soros Justice Fellowships, and a special reserve fund used as crises and unexpected opportunities arise, U.S. Programs seeks to promote full participation in the nation’s civic, political, and economic life—particularly for communities that are historically marginalized and vulnerable—and to ensure that the core institutions of civil society are effective and accountable to the public.

The work of U.S. Programs is organized around four central goals: a more inclusive and accountable American democracy; a fair criminal justice system; full political, economic, and civic participation of communities of color and immigrants; and equitable economic growth.

Among its priorities:

Justice

Working to end mass incarceration; making police departments more accountable to the communities they serve; challenging the death penalty; and replacing youth justice policies that stigmatize and suppress with those that safeguard the rights of children.

Drug Policy

Promoting policies that address drug use—and the health, mental health, and social needs it creates—within the context of communities rather than the justice system, and working to ensure access to comprehensive treatment.

Equality

Promoting fairness and equality for all people in the United States by removing barriers to full participation in economic, social, and civic life for marginalized communities; seeking to reduce the racial wealth gap and reform harsh school discipline policies that disproportionately impact children of color; working to improve life outcomes for boys and men of color; and changing the racial narrative in this country.

Democracy

Supporting high-quality journalism to help hold powerful institutions accountable; protecting the free flow of information through an internet accessible to all; reducing the undue influence of money in politics; expanding electoral participation and combat voter suppression; and advancing reforms safeguarding the independence of state courts.

Economic Advancement

Working to promote economic opportunity for all Americans, reduce income equality, and advance fair housing and lending policies.

National Security & Human Rights

Working to promote the rule of law, defend civil liberties and human rights, and combat Islamophobia in the face of overbroad or discriminatory U.S. counterterrorism policies and practices.

Philanthropy of Place

Testing ideas at the state and local level through our sole field office, the Open Society Institute–Baltimore, which focuses on drug addiction, over-reliance on incarceration, and obstacles that prevent youth from succeeding inside and out of the classroom, as well as through the Open Places Initiative, which promotes equality and improved civic participation in Buffalo, San Diego, and Puerto Rico.

***

Countless pages here on who he gives grant money to.

Programs
George Soros: Open Society Foundation: International Migration Initiative

Governance and Accountability
Through empowerment, policy change, and legal action, we target reforms that meaningfully improve the working and living conditions of migrants.

The International Migration Initiative seeks to address exploitation, discrimination and violence against migrants at every stage of their migration journey. Specifically, the initiative aims to increase protections for migrants in the Asia/Middle East and the Central America/Mexico corridors while improving policymaking and the governance of international migration.

Two unique aspects of the initiative’s approach amplify its impact: First, our focus on migration corridors means the initiative is active in both countries of origin and destination, and thus targets every stage of the migration journey. Second, we bridge advocacy and policy by drawing on the experience of grassroots organizations, while engaging with policymaker and political leaders. Through empowerment, policy change, and legal action, we target reforms that can meaningfully improve the working and living conditions of migrants.

The International Migration Initiative’s main areas of work are built around increasing protections for migrants and improving migration policymaking and the governance of international migration. Within these strategic priority areas, the initiative targets three overarching goals:

  • Deterring rights violations and increasing access to justice: The International Migration Initiative aims to demonstrably improve the working and living conditions of migrants by bringing about a measurable decline in acts of violence against them and reducing the incidence of forced labor. This requires the development of a broader, stronger network of organizations and practitioners engaged in advocacy. We are pursuing initiatives to increase access to justice by building capacity among legal practitioners so they can overcome legal and jurisdictional hurdles impeding migrants’ access to redress.
  • Empowering migrants: The initiative seeks to strengthen the ability of migrants to assert and defend their rights, primarily by increasing access to information. This involves improving the quality, coverage, and effectiveness of training and orientation seminars prior to departure and upon arrival in countries of employment. We also aim to create an enabling environment in which migrants can mobilize and make their voices heard through grassroots organizing, the development of associations and informal support networks, and the creation of migrant-run, community-based media.
  • Enhancing regional policymaking and dialogue: The initiative advances policy reform and the promulgation of best practices by enabling dialogue among key stakeholders, including among actors who might not otherwise come together. We also aim to build the evidence base necessary to inform these conversations and to deepen networks among policymakers, as well as between the state and civil society. In the long term, we aim to promote more inclusive, tolerant communities and a better-informed public in order to combat xenophobia and discrimination.

Hat tip to Michael

Hillary, FBI Investigation is a Security Review, Wrong

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It was a moment where words could be applied in general. Hillary stating that the FBI probe was merely a security review is flatly wrong. There are at least 2 tracks to the investigation. 1) Reviewing classified material in violation of the Espionage Act. 2) Reviewing whether there were foreign intrusions into her server, any of her devices or at the State Department.

One question that has not been asked: If Hillary did not have a dot gov email address nor did she have any government issued devices, ‘exactly how DID she receive classified material including material all the up to TS-SCI material? Was she ever in a SCIF?

Hillary misleading about email probe during debate, former FBI agents say

FNC: Hillary Clinton used misleading language in Thursday night’s Democratic debate to describe the ongoing FBI investigation into her use of a private email server to conduct official government business while she was secretary of state, according to former senior FBI agents.

In the New Hampshire debate with Senator Bernie Sanders, which aired on MSNBC, Clinton told moderator Chuck Todd that nothing would come of the FBI probe, “I am 100 percent confident. This is a security review that was requested.  It is being carried out.”

Not true says Steve Pomerantz, who spent 28 years at the FBI, and rose from field investigative special agent to the rank of assistant director, the third highest position in the Bureau.

“They (the FBI) do not do security reviews,” Pomerantz said. “What they primarily do and what they are clearly doing in this instance is a criminal investigation.”

Pomerantz emphasized to Fox News, “There is no mechanism for her to be briefed and to have information about the conduct, the substance, the direction or the result of any FBI investigation.”

Separately, an intelligence source familiar with the two prongs of the ongoing FBI probe, stressed to Fox that the criminal and national security elements remain “inseparable.”  The source, not authorized to speak on the record,  characterized Clinton’s statement “as a typical Clinton diversion… and what is she going to say, “I’m 95 percent sure that I am going to get away with it?”

Fox recently learned that one of the FBI’s senior agents responsible for counterintelligence matters, Charles H. Kable IV, is working the Clinton case, another indicator the intelligence source said that the FBI probe is “extremely serious, and the A-team is handling.”

Kable, known as “Sandy,” was appointed special agent in charge of the counterintelligence division at the Washington field office by Director James Comey in December.

He had recently served as the chief of the counterespionage section at FBI headquarters.  In that capacity, a bureau press releases says the 15-year, well-respected FBI veteran, “provided leadership and oversight to the field offices engaged in espionage, economic espionage, and insider threat investigations.”

While his responsibilities are not publicly known, Kable was described to Fox as “tough and no- nonsense FBI ” and analyst and agents are exploring whether the mishandling of classified information was “intentional” and who may have benefited.

A spokeswoman for the FBI took Fox’s questions, but said they would not be providing comment on Kable’s role or the FBI case.

In 2009, Kable led investigations against known and suspected Chinese intelligence officers in the U.S.  In January, former Secretary of Defense Robert Gates, told the Hugh Hewitt radio show that “the odds are pretty high” that then-Secretary of State Clinton’s personal email server was hacked by Iran, China and Russia.

An intelligence source told Fox, “it is no less of a violation of espionage statutes if any material was classified secret or top secret….All the statute requires is national defense information or NDI,” adding “this is way past accidental spillage…(it) is being investigated as intentional mishandling….in this kind of high profile investigation, the most damaging information takes primacy.”

Investigations into the compromise of classified information include damage assessments.  In the recent case of former CIA Director David Petraeus, the damage was deemed to be limited, discreet, and knowable because the highly classified information was shared with his biographer, who also had a security clearance.

In Hillary Clinton’s case, if the private server was compromised by a third party, the extent of the damage maybe unknowable.

The hacker “Guccifer” compromised Clinton’s adviser Sydney Blumenthal’s aol account, and he copied the email exchanges sent to Clinton.  The Romanian hacker, whose real name is Marcel Lehel Lazar, has an extradition hearing February 17, and in an interview, indicated he would welcome extradition to the U.S.

The amount of classified information, now including top secret emails the State Department withheld from public release last week, and more than 15-hundred containing classified information at various levels.

At the State Department briefing Thursday, spokesman John Kirby was asked by Fox News chief intelligence correspondent Catherine Herridge whether Clinton, as well as aides Huma Abedin, and Cheryl Mills, completed the required classified training that includes the proper storage, handling, and identification of classified information.

“Everybody here is trained in how to handle sensitive information. Sometimes that takes place in in-person briefings and I can’t comment any further,”  Kirby said.  Asked it was documented, Kirby said he had nothing more to offer, but did confirm Clinton, Abedin, Mills were not exempt from the strict rules that apply to State Department personnel.

Fox: “So they would not be an exception?”

Kirby: “Everybody that works at the State Department gets trained in how to handle sensitive information.  Sometimes that’s done in- person briefings.”

This is important because, on its face, it undercuts Clinton’s claim she had no way to know it was classified because the emails were not marked.  Personnel are trained (IF?) the content is classified, it can be marked, unmarked, or given in oral communications.

Under the Freedom of Information Act, Judicial Watch sought the records documented (IN?)the classification training, but in a letter dated January 22, 2016, exactly seven years after Clinton signed her Non-Disclosure Agreement (NDA) to serve as Secretary of State, the government watchdog was told “no responsive records” could be found.

Catherine Herridge is an award-winning Chief Intelligence correspondent for FOX News Channel (FNC) based in Washington, D.C. She covers intelligence, the Justice Department and the Department of Homeland Security. Herridge joined FNC in 1996 as a London-based correspondent.

Pamela K. Browne is Senior Executive Producer at the FOX News Channel (FNC) and is Director of Long-Form Series and Specials. Her journalism has been recognized with several awards. Browne first joined FOX in 1997 to launch the news magazine “Fox Files” and later, “War Stories.”

 

Benghazi Cmte: Dem. Staffers Got Bonuses

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Bonuses for what, stonewalling and refusals to cooperate or investigate?

Who authorized the bonuses and what staffers? Hello Congressman Cummings, you have a call holding on line 3 and there may be a knock at the door with a subpoena. Did the congressman himself take a bonus for leaking testimony to the press?

Did any of the surviving warriors get a bonus?

Benghazi committee Dems gave thousands in bonuses while blasting probe’s cost

FNC: Democrats on the House committee probing the 2012 Benghazi terror attacks awarded tens of thousands of dollars in bonuses to their staff, while at the same time repeatedly attacking Republicans over the rising cost of the investigation.

According to publicly available reports, a total of $33,600 was given to six Democratic staffers at the end of 2014 and 2015.

While the bonuses make up only a fraction of the panel’s total expenses to date, critics suggested they undermine the minority members’ complaints about the budget.

“This is the height of hypocrisy,” Lisa Boothe, a Republican strategist and president of High Noon Strategies, told FoxNews.com.

Democrats complain the committee’s investigation, established in May 2014, has gone on longer than the 9/11 Commission’s review of the 2001 terror attacks and have accused Republicans of using the committee as a political weapon to attack Democratic 2016 front-runner Hillary Clinton — who was secretary of state at the time of the Benghazi attacks.

And they have been relentless in describing the investigation as a waste of money, even including a “Benghazi Spending Tracker”on their website. The total taxpayer tab is now at nearly $6 million.

“Republicans continue to drag out this political charade closer to the 2016 presidential election, and the American taxpayers continue to pay the price,” ranking member Elijah Cummings, D-Md., said in January.

Boothe suggested there’s a disconnect.

“The Democrats on the committee want to criticize Republicans for investigating the deaths of four Americans to ensure a Benghazi style attack never happens again, but they have no problem doling out bonuses to their government staffers,” she said.

However, Democrats responded to questions about the bonuses by saying they have fewer staff and do more work than their Republican counterparts.

“Republicans are responsible for the decision to drag out this partisan charade for almost two years and for spending nearly $6 million to date. Democrats have about half the staff as the Republicans, spend less than half the budget of the Committee, and do just as much work, if not more,” a Democratic committee spokesman told FoxNews.com.

Last week, committee Republicans accused the Democrats of spending $2 million — more than one-third of the committee’s total cost — on what they called “politically motivated efforts to undermine and obstruct the investigation.”

Committee Republicans declined to comment, other than to confirm they have not given any bonuses.

Interesting that Elijah Cummings never talks about the 600 requests for more security in Benghazi.

In part from WaPo: “The chart was displayed in the hearing when the numbers were discussed, so all of the media and anyone else in the room could see it,” said the GOP staff member. “We also provided it to anyone who asked for a copy. As I’m sure you understand, members are often rushed when asking questions due to the limited time allotted them. Since Pompeo was discussing the numbers on the chart when it was right there for everyone to see, there was clearly no intent to mislead.”

As an example of a “concern,” the GOP staff provided a copy of a previously unpublished memo, embedded below. This memo, dated Aug. 28, 2012, or two weeks before the attacks, was written by the regional security officer in Benghazi as a transition memo for an incoming officer.

China’s Best Method of Industrial Espionage

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Obscure Chinese Firm Dives Into $22 Trillion U.S. Market

Bloomberg: When Cromwell Coulson heard that an obscure Chinese real estate firm had agreed to buy the Chicago Stock Exchange, he was shocked.

“My first reaction was, ‘Wow, that’s who they’re selling to?”’ said Coulson, the chief executive officer of OTC Markets Group Inc. in New York. “These new buyers have no connection to Chicago’s existing business. They’re completely disconnected from the current business of supporting the Chicago trading community. So wow, that’s out of left field.”

While the world has gotten used to seeing Chinese companies snap up overseas businesses, the purchase of a 134-year-old U.S. stock market by Chongqing Casin Enterprise Group — a little-known property and investment firm from southwestern China — raises a whole host of questions. For starters, why does a provincial Chinese business with no apparent ties to the securities industry have any interest in buying one of America’s smallest equity exchanges? And will U.S. regulators sign off?

So far, Casin Group’s intentions are unclear, with calls to the company’s Chongqing headquarters going unanswered on Friday. If the deal does pass muster with American regulators, it would mark the first-ever Chinese purchase of a U.S. equity exchange, giving Casin Group a foothold in a $22 trillion market where even the smallest bourses have room to grow if they can provide the best price for a stock at any given moment.

The Chicago Stock Exchange — a subsidiary of CHX Holdings Inc. — is minority-owned by a group including E*Trade Financial Corp., Bank of America Corp., Goldman Sachs Group Inc. and JPMorgan Chase & Co., according to the company. The minority shareholders are also selling their stake, Chicago Stock Exchange Chief Executive Officer John Kerin said in a phone interview.

The deal values the exchange at less than $100 million, according to a person familiar with the matter, who asked to not be identified because the terms weren’t disclosed publicly. Mark O’Connor, a spokesman for the exchange, declined to comment on the size of the transaction.

Overseas Shopping

Casin Group’s offer, announced on Friday in a statement from the Chicago exchange, comes amid an unprecedented overseas shopping spree by Chinese companies. Businesses from Asia’s largest economy have announced $70 billion of cross-border acquisitions and investments this year, on track to break last year’s record of $123 billion, according to data compiled by Bloomberg.

While many of those deals had obvious business rationales, the reasons for Casin Group’s bid are less clear. The company, founded in the 1990s through a privatization of state-owned assets, initially focused on developing real estate projects in Chongqing, before expanding into the environmental and financial industries. While the firm owns stakes in banks and insurers, it has no previous experience owning an exchange.

Chinese Growth

Lu Shengju, the majority owner and chairman of Casin Group, wants to help bring Chinese companies to U.S. markets, according to the statement from Chicago’s bourse.

“We have reviewed CHX’s plans to improve market share through new growth initiatives and fully support them,” Lu, a torch bearer during the Beijing Olympic games in 2008, said in the statement, which didn’t disclose terms of the deal. “Together, we have a unique opportunity to help develop financial markets in China over the longer term and to bring exciting Chinese growth companies to U.S. investors.”

The Chicago Stock Exchange could serve as a venue for Chinese companies to list, said Dale Rosenthal, a clinical assistant professor of finance at the University of Illinois at Chicago.

“Because they’re an exchange, they can list stock,” Rosenthal said. “It has the potential to raise Chicago’s profile in China.”

Casin Group is no stranger to investing in outside businesses, including overseas targets. Three years ago, the firm increased its stake in Shenzhen-listed Guoxing Property to 30 percent, becoming the biggest shareholder. Guoxing, now 60 percent owned by Casin Group, has soared 170 percent in the past two months, versus a 19 percent drop in the CSI 300 Index, data compiled by Bloomberg show. Casin Group bought a 25 percent stake in Singapore-based Great Eastern Life Assurance in 2013.

“It’s interesting to see the Chinese increase their footprint in the U.S.,” said Ramon Camacho, a principal at RSM US LLP, an audit, tax and consulting company based in Chicago. “These investors are looking for a platform to showcase and bring to market Chinese companies.”

The company’s bid for the Chicago bourse could face political opposition, with American regulators and politicians taking a skeptical approach toward foreign investments in industries deemed important to national interests. When Germany’s Deutsche Boerse AG wanted to buy the owner of the New York Stock Exchange in 2011, U.S. Senator Charles Schumer, a Democrat from New York, raised obstacles. The deal was finally scrapped on monopoly concerns.

Heavy Scrutiny

Some Chinese companies have come under heavy scrutiny as they tried to enter U.S. markets. Huawei Technologies Co., China’s largest phone-network equipment maker, was barred by the U.S. in 2011 from participating in building a nationwide emergency network.

The U.S. Securities and Exchange Commission would have to approve the deal, because the exchange is a self-regulatory organization. The new owners will have to show they intend to follow all of the regulations imposed on stock exchanges, whose listing and trading rules also must be approved by the SEC.

Additionally, the takeover would probably be reviewed by the Committee on Foreign Investment in the U.S., said Anne Salladin, a lawyer at Stroock & Stroock & Lavan LLP in Washington. CFIUS, a panel of government officials led by the Treasury Department that examines purchases of American businesses by foreign investors, can recommend the president block transactions it believes compromise national security. It can also impose changes to address any concerns.

“It’s a Chinese investment, and it’s in a potentially sensitive sector: financial infrastructure,” Salladin said.

CFIUS has been closely scrutinizing purchases of American businesses by Chinese buyers. Last month, Royal Philips NV abandoned its plan to sell its lighting-components unit to a Chinese-led investment group following opposition from CFIUS.

“If you have a U.S. stock exchange that’s primarily satisfying Chinese companies, the regulators are gonna look very closely at it,” Coulson said. “If your core business is listing Chinese companies in the U.S., that’s going to pick up a lot of regulatory scrutiny and caution.”

China Industrial Espionage:

This new book is the first full account, inside or outside government, of China’s efforts to acquire foreign technology.

Based on primary sources and meticulously researched, the book lays bare China’s efforts to prosper technologically through others’ achievements. For decades, China has operated an elaborate system to spot foreign technologies, acquire them by all conceivable means, and convert them into weapons and competitive goods—without compensating the owners. The director of the US National Security Agency recently called it “the greatest transfer of wealth in history.”

Written by two of America’s leading government analysts and an expert on Chinese cyber networks, this book describes these transfer processes comprehensively and in detail, providing the breadth and depth missing in other works. Drawing upon previously unexploited Chinese language sources, the authors begin by placing the new research within historical context, before examining the People’s Republic of China’s policy support for economic espionage, clandestine technology transfers, theft through cyberspace and its impact on the future of the US.

This book will be of much interest to students of Chinese politics, Asian security studies, US defence, US foreign policy and IR in general.

***

China’s long history of spying on business

CNN: The United States indicted five members of China’s People’s Liberation Army Monday, accusing them of hacking into American companies and pilfering closely-guarded trade secrets.  The charges — rejected by Beijing as “purely ungrounded and with ulterior purpose” — are a dramatic escalation in a squabble between the two countries over spying. But they will surprise few Americans working in sensitive industries.

While many countries engage in industrial espionage, China has long been among the most aggressive collectors of economic secrets — both online and off, experts say.

“I can tell you they [China] are the most pervasive,” Kevin Mandia, founder of cybersecurity firm Mandiant, told CNN. “The indictment is about taking intellectual property … it’s the theft of trade secrets, it’s economic espionage.” Full article here.