    [House Hearing, 119 Congress]
    [From the U.S. Government Publishing Office]

                        EVALUATING THE OPERATIONS OF THE
                        COMMITTEE ON FOREIGN INVESTMENT
                          IN THE UNITED STATES (CFIUS)
    =======================================================================

                                    HEARING

                                   BEFORE THE

                       SUBCOMMITTEE ON NATIONAL SECURITY,
                       ILLICIT FINANCE, AND INTERNATIONAL
                             FINANCIAL INSTITUTIONS

                                     OF THE

                        COMMITTEE ON FINANCIAL SERVICES
                         U.S. HOUSE OF REPRESENTATIVES

                        ONE HUNDRED NINETEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                JANUARY 14, 2026

                                   __________

                               Serial No. 119-51

           Printed for the use of the Committee on Financial Services

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                                www.govinfo.gov

                                   __________

                     U.S. GOVERNMENT PUBLISHING OFFICE
    63-579 PDF              WASHINGTON : 2026
    =======================================================================

                     HOUSE COMMITTEE ON FINANCIAL SERVICES

                        FRENCH HILL, Arkansas, Chairman

    BILL HUIZENGA, Michigan, Vice        MAXINE WATERS, California, Ranking
        Chairman                             Member
    FRANK D. LUCAS, Oklahoma             SYLVIA R. GARCIA, Texas, Vice
    PETE SESSIONS, Texas                     Ranking Member
    ANN WAGNER, Missouri                 NYDIA M. VELAZQUEZ, New York
    ANDY BARR, Kentucky                  BRAD SHERMAN, California
    ROGER WILLIAMS, Texas                GREGORY W. MEEKS, New York
    TOM EMMER, Minnesota                 DAVID SCOTT, Georgia
    BARRY LOUDERMILK, Georgia            STEPHEN F. LYNCH, Massachusetts
    WARREN DAVIDSON, Ohio                AL GREEN, Texas
    JOHN W. ROSE, Tennessee              EMANUEL CLEAVER, Missouri
    BRYAN STEIL, Wisconsin               JAMES A. HIMES, Connecticut
    WILLIAM R. TIMMONS, IV, South        BILL FOSTER, Illinois
        Carolina                         JOYCE BEATTY, Ohio
    MARLIN STUTZMAN, Indiana             JUAN VARGAS, California
    RALPH NORMAN, South Carolina         JOSH GOTTHEIMER, New Jersey
    DANIEL MEUSER, Pennsylvania          VICENTE GONZALEZ, Texas
    YOUNG KIM, California                SEAN CASTEN, Illinois
    BYRON DONALDS, Florida               AYANNA PRESSLEY, Massachusetts
    ANDREW R. GARBARINO, New York        RASHIDA TLAIB, Michigan
    SCOTT FITZGERALD, Wisconsin          RITCHIE TORRES, New York
    MIKE FLOOD, Nebraska                 NIKEMA WILLIAMS, Georgia
    MICHAEL LAWLER, New York             BRITTANY PETTERSEN, Colorado
    MONICA DE LA CRUZ, Texas             CLEO FIELDS, Louisiana
    ANDREW OGLES, Tennessee              JANELLE BYNUM, Oregon
    ZACHARY NUNN, Iowa                   SAM LICCARDO, California
    LISA McCLAIN, Michigan
    MARIA SALAZAR, Florida
    TROY DOWNING, Montana
    MIKE HARIDOPOLOS, Florida
    TIM MOORE, North Carolina

                          Ben Johnson, Staff Director

                                     ------

     SUBCOMMITTEE ON NATIONAL SECURITY, ILLICIT FINANCE, AND INTERNATIONAL
                             FINANCIAL INSTITUTIONS

                        WARREN DAVIDSON, Ohio, Chairman

    ZACHARY NUNN, Iowa, Vice Chairman    JOYCE BEATTY, Ohio, Ranking Member
    FRANK D. LUCAS, Oklahoma             JOSH GOTTHEIMER, New Jersey
    PETE SESSIONS, Texas                 JUAN VARGAS, California
    ANDY BARR, Kentucky                  BILL FOSTER, Illinois
    ROGER WILLIAMS, Texas                VICENTE GONZALEZ, Texas
    YOUNG KIM, California                RITCHIE TORRES, New York
    ANDREW OGLES, Tennessee              SEAN CASTEN, Illinois
    LISA McCLAIN, Michigan               SAM LICCARDO, California
    MARIA SALAZAR, Florida
                             C  O  N  T  E  N  T  S

                                  ----------

                          Wednesday, January 14, 2026
                               OPENING STATEMENTS

                                                                       Page
    Hon. Warren Davidson, Chairman of the Subcommittee on National
      Security, Illicit Finance and International Financial
      Institutions, a U.S. Representative from Ohio..................     1
    Hon. Joyce Beatty, Ranking Member of the Subcommittee on National
      Security, Illicit Finance and International Financial
      Institutions, a U.S. Representative from Ohio..................     3

                                   STATEMENTS

    Hon. French Hill, Chairman of the Committee on Financial
      Services, a U.S. Representative from Arkansas..................     4

                                   WITNESSES

    Statement of Hon. Chris Pilkerton, Assistant Secretary for
      Investment Security, U.S. Department of the Treasury...........     4
        Prepared statement...........................................     7

                                    APPENDIX

                       MATERIALS SUBMITTED FOR THE RECORD

    Hon. Maxine Waters:
        Coalition for a Prosperous America (CPA).....................    40
        Quantifind...................................................    47
    Hon. Sam Liccardo:
        January 14, 2026 letter to David Ellison.....................    51

                     RESPONSES TO QUESTIONS FOR THE RECORD

    Written responses to questions for the record from Representative
        Representative French Hill...................................    55
        Representative Maxine Waters.................................    62
        Representative Zachary Nunn..................................    73
        Representative Sean Casten...................................    76

                        EVALUATING THE OPERATIONS OF THE
                        COMMITTEE ON FOREIGN INVESTMENT
                          IN THE UNITED STATES (CFIUS)

                                  ----------

                          Wednesday, January 14, 2026

                 U.S. House of Representatives,
    Subcommittee on National Security, Illicit Finance,
              and International Financial Institutions,
                               Committee on Financial Services,
                                                        Washington, DC.

        The subcommittee met, pursuant to notice, at 10:05 a.m., in
    room 2128, Rayburn House Office Building, Hon. Warren Davidson
    [chairman of the subcommittee] presiding.
        Present: Representatives Davidson, Lucas, Sessions, Barr,
    Williams of Texas, Kim, Ogles, Nunn, Beatty, Vargas, Foster,
    Gonzalez, Casten, and Liccardo.
        Also present: Representatives Hill, Waters, and Green.
        Chairman Davidson. The Subcommittee on National Security,
    Illicit Finance, and International Financial Institutions will
    come to order.
        Without objection, the chairman is authorized to declare a
    recess of the committee at any time. This hearing is titled,
    ``Evaluating the Operations of the Committee on Foreign
    Investment in the United States.'' Without objection, all
    members will have 5 legislative days within which to submit
    extraneous materials to the chairman for inclusion in the
    record.

      OPENING STATEMENT OF HON. WARREN DAVIDSON, CHAIRMAN OF THE
        SUBCOMMITTEE ON NATIONAL SECURITY, ILLICIT FINANCE AND
      INTERNATIONAL FINANCIAL INSTITUTIONS, A U.S. REPRESENTATIVE
                               FROM OHIO

        Today is the committee's annual oversight hearing on the
    Committee on Foreign Investment in the United States (CFIUS)
    and will provide members an opportunity to review the Trump
    Administration's implementation of the CFIUS process and the
    Outbound Investment Security Program, both of which are
    administered by the Office of Investment Security.
        The United States is the world's top destination for
    foreign direct investment, with over $5.7 trillion in total
    investment so far, and trillions of dollars of new commitments
    during this--President Trump's current term.
        Our open investment environment makes this possible, which
    is why successive presidents have reaffirmed it is important.
    In fact, foreign direct investment accounts for 10 percent or
    more of jobs while foreign firms employ around 25 percent of
    all manufacturing workers, making investment critical to the
    well-being of Americans across the country.
        Established in 1975 under the Department of Treasury, CFIUS
    seeks to preserve this open investment environment while
    ensuring that the very openness does not become a weapon our
    adversaries could use against us. The 2018 Foreign Investment
    Risk Review Modernization Act, otherwise known as FIRRMA,
    expanded its jurisdiction to include noncontrolling investments
    in critical technologies' infrastructure and sensitive personal
    data. CFIUS must rigorously scrutinize foreign investments from
    any source that could undermine our technology, agriculture,
    energy sectors, and more while enabling beneficial investments
    and inflows that do strengthen our economy.
        At the same time, CFIUS must not become so bureaucratic
    that the process prioritizes answering every conceivable
    question over neutralizing threats. So with this in mind, I
    want to commend President Trump both for his America First
    Investment Policy, which reiterates its commitment to welcoming
    foreign investment, as well as his tireless efforts to secure
    trillions in new investment in our country.
        I especially want to highlight CFIUS's Known Investor
    Portal pilot program, which promises to streamline investment
    for repeat friendly investors, allowing resources to be
    directed where they matter most for screening new risks.
        However, reviewing inbound investments alone cannot fully
    protect our national security. This is why Congress enacted
    Representative Barr's Comprehensive Outbound Investment
    National Security (COINS) Act last month as part of the
    National District Attorneys Association (NDAA), which tasks the
    Office of Investment Security to build on the Outbound
    Investment Security Program. Now that this legislation has
    become law, it falls on this committee to ensure that it is
    implemented in a targeted and thoughtful manner while ensuring
    that American capital does not support military industrial
    bases of our adversaries, particularly the People's Republic of
    China.
        As treasury writes an updated outbound investment rule, it
    is imperative that it is clear, streamlined framework so that
    it can ensure American investors can comply without overly
    burdensome bureaucratic obstacles that halts our financial
    sector.
        As the world becomes more complex and interconnected,
    Office of Information Security (OIS) must ensure that U.S.
    national security is protected both to inbound and outbound
    investment fronts, and in ensuring that our processes are
    efficient and effective means investment screening must be
    transparent and clear for our friends and fellow citizens to
    comply with, and difficult for our adversaries to exploit. This
    is our task today.
        I yield back and I now recognize the ranking member for her
    remarks.

     OPENING STATEMENT OF HON. JOYCE BEATTY, RANKING MEMBER OF THE
        SUBCOMMITTEE ON NATIONAL SECURITY, ILLICIT FINANCE AND
      INTERNATIONAL FINANCIAL INSTITUTIONS, A U.S. REPRESENTATIVE
                               FROM OHIO

        Mrs. Beatty. Good morning, and thank you, Mr. Chairman, for
    holding this hearing, and thank you to our assistant secretary
    for being here today, fresh on the job.
        The Committee on Foreign Investment in the United States,
    or CFIUS, plays a pivotal role in our national security
    framework by ensuring that foreign direct investment
    transactions do not pose a threat to the United States while
    maintaining an open investment environment. Although CFIUS has
    only blocked a handful of transactions to date, its thorough
    vetting process is essential to protect our national security.
    The businesses that participate in that process rely on its
    clear and fair rules.
        Unfortunately, under President Trump, the CFIUS review
    process has become unpredictable and turned into a political
    tool used to punish his opponents while enriching himself, his
    family, and his billionaire friends. We saw this with TikTok
    where he exploited tangible security concerns for personal and
    political leverage. We saw this with the Nippon Steel-U.S.
    Steel deal where he inserted his own name and operational
    controls into the new company's Articles of Incorporation.
        Since taking office, we have seen it with his crypto
    ventures involving foreign actors that have increased his
    personal net worth by billions.
        This repeated and blatant abuse of power does not make
    America safer. It only creates confusion for businesses; it
    scares investors and weakens our ability to compete with
    adversaries like China.
        Every member of this subcommittee should be concerned about
    the President's activities and the national security risks they
    create, particularly on the heels of last summer's hearing
    where we all agreed on the importance of a clean investment
    security process.
        We must preserve the integrity of CFIUS and ensure our
    national security tools remain protected and well-resourced.
    That includes reinstating the bipartisan supported Corporate
    Transparency Act rule to help national security programs like
    CFIUS combat anonymous shell companies used to obscure the true
    ownership and control beyond covered transactions. This
    administration, and some of my colleagues across the aisle are
    determined to undercut this bipartisan law, which will only
    make it harder for CFIUS, the Outbound Security Program,
    financial institutions, and national security agencies to
    properly assess national security risk.
        Certainly we are here because of the very nature of the
    name of this committee, that we are committed and obligated to
    protect our national security.
        Last, politics has no place in matters of national
    security, and Democrats will continue to resist efforts that
    would either undercut CFIUS or distort its purpose. Since our
    last hearing on investment security, the Comprehensive Outbound
    Investment National Security, or as we refer to, COINS Act was
    signed into law, codifying the expanding and Outbound
    Investment Program.
        So welcome, and we will be watching the implementations of
    this law closely. I look forward to learning more about our
    investment security framework and operating and exploring ways
    that we can strengthen it.
        Thank you again for being here, and thank you, Mr.
    Chairman, for holding this committee and I yield back.
        Chairman Davidson. I thank the ranking member.
        I now recognize the chairman of the full committee, Mr.
    Hill, for 1 minute for an opening statement.

      STATEMENT OF HON. FRENCH HILL, CHAIRMAN OF THE COMMITTEE ON
        FINANCIAL SERVICES, A U.S. REPRESENTATIVE FROM ARKANSAS

        Chairman Hill. Thank you, Chairman Davidson, and welcome,
    Secretary Pilkerton. We are glad to have you today.
    Congratulations.
        CFIUS plays a critical role in safeguarding the national
    security while also fostering here in the United States an open
    investment climate. Today we are examining how its expanded
    authority under FIRRMA impacts U.S. investment in emergency
    security challenges.
        CFIUS continues to evolve to address national security
    threats from abroad. At the same time, CFIUS's narrow mission
    supports the confidence investors have in the openness and
    integrity of the U.S. economy. As with any national security
    program, ongoing oversight and evaluation of CFIUS's
    effectiveness are essential duties for the Members of Congress,
    and particularly this committee. Our discussion will focus on
    evaluating CFIUS's role in protecting national security while
    upholding that open investment climate.
        CFIUS has earned bipartisan support by sticking to this
    mission. It does not and must not allow itself to become a tool
    for industrial policy and partisan agendas.
        I thank the witness for being here today, and I look
    forward to our discussion. I yield back.
        Chairman Davidson. Thank you, Chairman.
        Today we welcome the testimony of Hon. Chris Pilkerton,
    Assistant Secretary for Investment Security at the U.S.
    Department of Treasury.
        Assistant Secretary Pilkerton, thank you for taking time to
    be here today. Congratulations on your confirmation. You will
    be recognized for 5 minutes to give an oral presentation of
    your written testimony. Without objection, your written
    statement will be made part of the record.
        Assistant Secretary Pilkerton, you are now recognized.

      STATEMENT OF HON. CHRIS PILKERTON, ASSISTANT SECRETARY FOR
          INVESTMENT SECURITY, U.S. DEPARTMENT OF THE TREASURY

        Mr. Pilkerton. Good morning. Chairman Hill, Chairman
    Davidson, Ranking Member Beatty, and members of the
    subcommittee, thank you for inviting me here to testify today
    to provide an update on the Committee on Foreign Investment in
    the United States.
        I come before you today having been sworn in as the
    Assistant Treasury Secretary for Investment Security just over
    a week ago on January 5. While I am new to this role, CFIUS is
    currently celebrating its 50th anniversary, and I humbly accept
    this important charge to safeguard our country's national
    security while ensuring that America continues to be the
    world's greatest destination for investment.
        In his America First Investment Policy, President Trump
    committed to maintaining a strong and open investment
    environment coupled with critical national security
    protections. The President's tireless work on behalf of the
    American people is driving trillions of dollars of investment
    commitments into America, bolstering our superior commercial
    innovations and technologies, creating jobs, building
    communities, and providing opportunities for many Americans. As
    I am sure you are all aware, the CFIUS annual report to
    Congress provides a more comprehensive picture of the
    committee's work, so I would like to use my statement here to
    share just some of the key program goals for 2026.
        First and foremost, CFIUS's core priority remains assessing
    and addressing any national security risks that arise from
    transactions that fall within its jurisdiction. By evaluating
    these potential threats from adversarial actors, the
    committee's many interagency participants, including subject
    matter experts, law enforcement, and the intelligence
    community, serve as important gatekeepers to protect our
    homeland. The commitment to this guiding principle must always
    lead the committee's work.
        Second, process efficiencies and stakeholder communication
    will be an important part of CFIUS. While the national security
    risk assessments must be thorough and dependable and will
    always serve as the touchstone of the program, we understand
    that unnecessary delays and overburdensome procedures can
    potentially reduce investment and limit the opportunity for job
    creation and local economic impact.
        In this spirit, as set forth in the America First
    Investment Policy, President Trump directed CFIUS to create an
    expedited fast-track process to facilitate greater investment
    from allies and partners, which we are now piloting as the
    Known Investor Program. This is the first iteration of a
    program that will seek to collect detailed information from
    foreign investors in advance of potential transactions so we
    can maximize administrative efficiencies while still adhering
    to the integrity of process, including robust due diligence and
    tailored actions where necessary to protect national security.
    We intend to build upon this pilot over the course of this year
    and look forward to working with relevant parties to ensure its
    success.
        Third, as Congress directed, filing certain types of
    transactions with CFIUS is mandatory, and the committee has the
    authority to review any transaction not voluntarily filed with
    CFIUS that is covered by its jurisdiction and may raise
    national security considerations. Accordingly, CFIUS is focused
    on ensuring transaction parties comply with the mandatory
    filing requirement, and we are prepared to act if they fail to
    do so. When in doubt, we encourage parties to engage
    proactively with CFIUS and utilize the committee as a resource
    in these circumstances, as addressing national security risks
    is typically easier for all parties involved before a
    transaction is closed than after.
        Fourth, building on the benefits of foreign investment,
    which include increased jobs, wages, research and development,
    exports, and many more. In line with CFIUS's mandates to
    educate the business community and strengthen national
    security, we want to work with industry to better understand
    their supply chain and vendor needs so we can work with
    interagency partners, such as SelectUSA, the U.S. Small
    Business Administration, and the Department of War's Office for
    Industrial Base Policy, as well as the private sector to better
    inform their deployment of capital to build secure and
    resilient sources of supply right here in the United States.
        Fifth, as Congress set forth in the Foreign Investment Risk
    Modernization Act in 2018, CFIUS will continue to actively work
    with allies and partners on their own investment security
    programs. This engagement to date has led to the establishment
    and enhancement of dozens of investment screening mechanisms
    around the world and will remain an important part and
    important tool as this administration engages the global
    community on critical economic and national security issues.
    This work will be coupled with the insights of our growing team
    of subject matter experts, scientists, and engineers to ensure
    we stay ahead of global technology trends and potential
    threats.
        CFIUS will continue to review the committee's processes,
    practices, and authorities to ensure that we are well-equipped
    to address existing and evolving threats that can accompany
    foreign investment while preserving the United States' strong
    and open investment environment.
        Thank you again for inviting me to appear today, and I look
    forward to your questions.

        [The prepared statement of Mr. Pilkerton follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Chairman Davidson. Thank you. We will now turn to member
    questions, and I recognize myself for 5 minutes.
        I support President Trump's February National Security
    Presidential Memorandum, which makes clear that the United
    States can and must encourage foreign investment while
    rigorously protecting our own national security. The memorandum
    reaffirms a core principle of America's economic leadership:
    Remain open for business to our allies and trusted partners,
    but we will not allow adversaries to exploit our openness to
    undermine our technological edge, our supply chains, or our
    overwhelming military superiority. That balance--speed for
    trusted investors, scrutiny for adversaries--is essential if we
    want the United States to remain the world's top destination
    for investment while keeping our national security front and
    center. I hope that we grow our friends, grow our allies, and
    diminish our enemies in this process but with the surge of
    commitments in foreign direct investment, efficiency becomes
    even more important.
        So in May, CFIUS launched the Known Investor Portal. Mr.
    Secretary, how will you and your team ensure that information
    collected by the portal actually expedites reviews without
    becoming just another bureaucratic process?
        Mr. Pilkerton. Mr. Chairman, thank you for that question. I
    wholeheartedly agree with you that predictability, durability,
    and efficiency of the process is absolutely critical.
        The Known Investor Program, which is tied back to the fast-
    track concept in the America First Investment Policy, is
    currently under pilot. We are in the process of gathering
    information and learning new information to ensure that process
    is as efficient as it possibly can be. In fact, we are going to
    be releasing soon a request for information from the public as
    well to get a sense from a whole variety of stakeholders so we
    can ensure that we are accounting for all of that.
        Under my leadership, it will not be just another
    bureaucratic exercise. The purpose of this exercise is to get
    as much data as possible so that as we conduct our national
    security reviews, we can have a very good understanding of the
    parties that we are conducting transactions with and their
    intentions.
        Chairman Davidson. Thank you so much.
        In CFIUS's annual report for 2024, it states that the
    committee, quote, identified and considered thousands of
    potential non-notified transactions. Do you know how CFIUS
    calculated the ``thousands'' number, and are you satisfied with
    the number of voluntary filings received? I think the concern
    is--is there a type of transaction that is not--where you are
    not being notified at CFIUS? So what steps can Congress do to
    shore that up, or what are your concerns as you come into this
    role?
        Mr. Pilkerton. Thank you for the question.
        As I alluded to in my opening statement, we cannot conduct
    national security reviews of transactions that we do not know
    about. So non-notified transactions are going to be a priority
    for this administration. There is various sources that we can
    identify these through--open-source activities, referrals,
    intelligence community, law enforcement but one of the things
    that I intend to do is be able to travel and share some
    information about CFIUS and the program writ large with the
    communities and with the country so that we can inform folks--
    so we can get more information about non-notifieds.
        The important thing to recognize about non-notified
    transactions, as I said in my earlier statement, is if we find
    out about them, then we can work with the parties to see if
    there is a way to get to mitigation or get to a potential
    transaction.
        Chairman Davidson. Thank you. As we look forward to the
    challenge of looking at outbound screening as well, one of the
    concerns is, even on the current inbound process, it seems like
    every year it gets more complex and less transparent and
    sometimes takes longer. So to what extent is Treasury playing,
    kind of, quality control and making sure these are relevant
    questions? At some level, they kind of have to be unique to the
    situation even if it is a known investor, this particular
    investment has got its own criteria to some extent. How do
    you--how do you get, I guess, efficient at operating that?
    Because that is, I think, a concern a lot of folks in industry
    have, is that it is inconsistent or not a very efficient
    process.
        Mr. Pilkerton. Thank you very much for the question.
        While I have just been in the office for about a week, I
    already have a big whiteboard in my office that says ``process,
    process, process,'' and I want to make sure that we are
    minimizing the inefficiencies in the process and hearing from
    the public and the stakeholders to ensure that the information
    that we are asking for is certainly consistent with what we
    need to make this decision.
        We engage very closely with the intelligence community, law
    enforcement, and of course the other committee members to make
    sure the information that we are gathering is useful to them.
    So I think that will be sort of an ever-growing process. Once
    again, I take your point that efficiency is critical for the
    predictability of these transactions.
        Chairman Davidson. Thank you so much.
        I now recognize the gentlewoman from Ohio, Mrs. Beatty, who
    is the ranking member of the subcommittee.
        Mrs. Beatty. Thank you, Mr. Chairman. Again, thank you to
    our witness.
        In September, President Trump signed an executive order
    announcing the formal start of the Trump Gold Card visa program
    whereby individuals and corporations can fast-track their U.S.
    residency process by making a financial contribution to the
    United States.
        How are investments related to these so-called ``golden
    visas'' being reviewed by CFIUS for national security
    implications and describe in detail what is being done on this
    issue, please.
        Mr. Pilkerton. Ranking Member Beatty, thank you very much
    for the question, and I appreciate you having me before the
    committee today.
        As you are aware, there is CFIUS confidentiality across any
    cases that may or may not be part of the committee's
    jurisdiction or under review. So I cannot speak to any
    particular matter.
        The visa that you are referencing is being overseen by the
    Commerce Department, so I certainly could refer you to them.
    For your awareness, and I am sure as you know, Commerce is a
    very important part of the committee. So on any issues that
    they are overseeing, we will be working closely with them and
    that information will also be shared with the rest of the
    committee so they can help us identify any national security
    risks regardless of the matter before them.
        Mrs. Beatty. Okay. So you do not have anything to do with
    that at all. Is that what you are basically saying? I can check
    with Commerce to see what they would have to say.
        Mr. Pilkerton. I certainly understand and appreciate that,
    but I cannot speak to any----
        Mrs. Beatty. You cannot tell me if you have something to do
    with it or not? That is a yes or no.
        Mr. Pilkerton. I----
        Mrs. Beatty. I understand your point about you cannot go
    into detail, but you could say yes or no that you have
    something to do with it--in your authority or not. So is that a
    no? Because I am going to research it more and I think there
    might be something that you are looking at, but I will accept
    your yes or no.
        Mr. Pilkerton. With all due respect, under my understanding
    of CFIUS confidentiality, I cannot speak to transactions that
    may or may not be coming through the process----
        Mrs. Beatty. So you do not know if it is coming through the
    process or not?
        Mr. Pilkerton. I cannot speak to anything with respect to--
    --
        Mrs. Beatty. I am not asking you to speak about it. I am
    simply asking you, in your role, is this something that could
    or would come through your process? That is not violating any
    confidentiality. I am not asking you to address talking about
    it, just if you have any belief or knowledge that it could or
    may come through you. That is a simple yes or no. I take that
    as you are not going to answer. Let me go to my second
    question.
        You noted in your opening testimony that pursuant to
    President Trump's direction, CFIUS is piloting an expedited
    review process for lower risk transactions. What is the status
    of this procedure, which is through your jurisdiction? For the
    record, a follow up to Mr. Chairman's question is--you can say
    yes or no--that this will go through the notice and comment
    period.
        Mr. Pilkerton. Yes. So with respect to the Known Investor
    Program, I certainly can confirm that process is in an up-and-
    running pilot. We anticipate that pilot to go through 2026. We
    are gathering information and getting lessons learned. As I
    referenced before, we do have a request for information that
    will be coming out soon to get more information. I would also
    anticipate that we would be putting out a lot of public
    guidance associated with that over the course of the year. I
    know it is an area of specific interest, obviously, for you and
    for the committee. So we want to be sure that we are not only
    sharing that information but also getting as much feedback as
    we can to make sure it is as efficient as possible.
        Mrs. Beatty. How long of a period? Is that a 60-day period?
    A 90-day period of the notice and comment period?
        Mr. Pilkerton. I do not know if we have determined that,
    but I think it will probably be around 60 days. That would be
    my guess.
        Mrs. Beatty. Also, the Foreign Investment Risk Review
    Modernization Act mandates that CFIUS coordinate with allies
    and partners in information sharing and investment screening
    efforts. Is CFIUS doing this and in what ways could the
    committee improve those efforts?
        Mr. Pilkerton. Could you repeat the question? I am sorry.
    The door just opened and I----
        Mrs. Beatty. No worries. The Foreign Investment Risk Review
    Modernization Act mandates that CFIUS coordinate with allies
    and partners in information sharing and investment screening
    efforts. Is CFIUS doing this and what ways could the committee
    improve those efforts?
        Mr. Pilkerton. Thank you very much for the question and
    thank you for repeating it.
        Mrs. Beatty. No worries.
        Mr. Pilkerton. Yes. The international partner engagement
    for CFIUS, as I mentioned in my opening statement, is
    absolutely critical. Over the course of the program,
    particularly over the last few years, we have had a number of
    interactions--and it is very routine--with folks around the
    world to help them to develop their investment screening
    processes. Some of the countries that we talk with do not have
    any investment screening. Some only have sort of a smaller
    version of it and so we want to share best practices as to what
    we have learned as well because not only is it just sharing
    that information abroad, there is also a huge benefit to the
    United States because any country that we do business with
    could certainly become an unwitting vector for an adversary.
        Mrs. Beatty. Thank you. My time is up. Thank you for that
    detailed response.
        Mr. Pilkerton. Thank you.
        Chairman Davidson. I thank the ranking member.
        I now recognize the gentleman from Arkansas, Mr. Hill, who
    is the chairman of the full committee, for 5 minutes.
        Chairman Hill. Thank you, Chairman Davidson, and again,
    welcome, Mr. Secretary.
        We heard in opening comments about not wanting to undercut
    CFIUS's important role due to politicization, but I think many
    believe that President Biden politicized the CFIUS process when
    he rejected Nippon Steel's acquisition of U.S. Steel. In my
    view, this abuse undermined the national security function of
    CFIUS and called into question the credibility of the process.
        I am glad to see in the last few months that the Trump
    Administration has reversed that decision and that--you
    mentioned in your opening statement the importance of the
    integrity of the system. Can you tell me what steps Treasury
    has taken to undo that damage and return CFIUS to its impartial
    national security role?
        Mr. Pilkerton. Thank you very much for the question, Mr.
    Chairman.
        Obviously, Congress has established a very clear process.
    As I mentioned in my opening, CFIUS is celebrating its 50th
    anniversary, and obviously the laws have been updated over the
    years, including most recently with FIRRMA, and now the COINS
    Act that we have from the NDAA.
        It has been a key principle that when we look at a
    transaction, the entire committee--so you have got experts from
    all the different agencies looking at these transactions to
    determine what the potential national security risks are and
    those national security risks are a whole host of different
    things. I know we spent a lot talking about technology and
    data, and obviously those are some of the large ones, but when
    we go through the process, we move from the area of identifying
    the risks to looking at what the potential mitigation
    strategies or controls will be. It is a standard enterprise
    risk management process that I have taught in academia prior to
    this and that is what is supposed to happen. It is the threat
    of the potential actor, the vulnerability of the actual
    transaction, and then what is that risk that we need to control
    for. It is a very, sort of--I am opening it as a sort of simple
    equation. It is obviously much more complicated than that, but
    that is what the process should be and will certainly continue
    to be under my leadership.
        Chairman Hill. We will certainly be watching for that here
    in the committee in our oversight capacity.
        Japan is one of our closest allies, no doubt, but CFIUS has
    still not granted Japan accepted foreign State status. Why do
    so many of our friendly partner nations remain subject to CFIUS
    hurdles when Congress gave you a tool to exempt them?
        Mr. Pilkerton. Thank you very much for the question.
        As you know, right now, the accepted foreign State status
    is limited to The Five Eyes partners. We certainly are always
    examining that and looking at opportunities to ensure that we
    are able to bring in various investments from various
    countries. I think Known Investor Program is certainly another
    way to take a look at that, and we certainly want to advance
    that. Japan has certainly been a strong ally and partner, and I
    am always happy to engage with you and----
        Chairman Hill. I think we should continue the conversation
    because as the government moves to more of a partnership
    friend-shoring issue and challenge--taking the challenge of
    critical mineral development, the processing of those is
    unlikely to take place in the U.S., but it is also unlikely to
    take place in a lot of The Five Eyes member countries with
    exception, perhaps, of Australia. So I think that kind of a
    business combination is going to be important going forward.
        On the nations that have sought consultation with you on
    developing their own inbound investment screening protocol,
    could you provide us with a list of those countries in the
    Western Hemisphere that you have consulted with?
        Mr. Pilkerton. Just picking up on your last point about
    Japan, I know Japan has been increasing their investment
    screening, and we will be likely engaging with them to learn
    more and be as helpful as we can.
        With respect to the number of countries that we have had in
    the Western Hemisphere that we have engaged with, I am happy to
    circle back to you on that.
        Chairman Hill. That would be helpful and we are happy to
    receive that, if it needs to be classified in a classified
    setting.
        Treasury continues to implement the outbound investment
    restrictions that were launched by the Biden Administration,
    and just last month, it was reported that China was trying to
    undo the U.S. investment assumption of CK Hutchinson's ports,
    which included those at the Panama Canal. That was a major
    outbound investment championed by the President, and so, I am
    concerned that it is off track. Could you, in the time I have
    remaining--we do not have much, so would you respond to me in
    writing on that subject?
        Mr. Pilkerton. Yes, sir. Happy to do so.
        Chairman Hill. Good. Thank you very much. Mr. Chairman, I
    yield back.
        Chairman Davidson. Thank you, Chairman.
        I now recognize the gentlewoman from California, Ms.
    Waters, who is the ranking member of the full committee.
        Ms. Waters. Thank you very much.
        Mr. Pilkerton, last year, it was announced that President
    Trump's World Liberty Financial completed a deal with MGX, a
    company based in the United Arab Emirates. The foreign firm
    invested $2 billion in Binance, a shady Chinese-owned
    cryptocurrency exchange, where Treasury had said, and I quote,
    allowed money to flow to terrorists, cyber criminals, and child
    abusers through its platform, unquote. To fund the deal, MGX
    purchased $2 billion of Trump's World Liberty Financial
    stablecoin USD1, effectively a hefty foreign investment in
    Trump's then brand new stablecoin.
        Further, while it is unclear what role Binance played or
    continues to play in World Liberty Financial, we do know that
    the foreign firm has no public headquarters, and the former CEO
    received a pardon shortly after accepting the Trump
    stablecoins. Thus, we know that this sounds like a covered
    transaction between a U.S. business and a foreign person that
    would require CFIUS review.
        Did CFIUS receive the required filing from the parties for
    this significant transaction? Did CFIUS complete a review of
    the transaction? If so, what was the outcome?
        Mr. Pilkerton. Ranking Member Waters, thank you very much
    for the question.
        Given the fact that there is statutory confidentiality
    associated with the CFIUS program, I am not permitted to speak
    about any matter that may or may not have come through the
    CFIUS program.
        Ms. Waters. So was the review done?
        Mr. Pilkerton. With respect to this or any other matter,
    under the statutory confidentiality, I am not able to speak to
    any particular matter.
        Ms. Waters. What I would like to ask you is if there was a
    review of the transaction, could we get a briefing on it here
    in Financial Services?
        Mr. Pilkerton. I am happy to have our legislative team work
    with your staff.
        Ms. Waters. I beg your pardon?
        Mr. Pilkerton. I said I am happy to have our legislative
    team work with your staff on this.
        Ms. Waters. You will have them do the--give us the
    briefing?
        Mr. Pilkerton. I will certainly ask my legislative team to
    engage with your staff on this matter.
        Ms. Waters. Who has the authority to make sure that they do
    it? You said you would ask. What if you get a ``no?''
        Mr. Pilkerton. I will talk to my legislative team, and I
    will certainly have them engage with your staff on this matter.
        Ms. Waters. You will do that.
        Mr. Pilkerton. I absolutely will speak----
        Ms. Waters. Let the record--record such. Thank you so very
    much.
        Mr. Pilkerton. Thank you, ma'am.
        Ms. Waters. I have another question I would like to ask you
    at this point, if I can just identify where that question is. I
    thank you for being here.
        As you know, Congress passed the Outbound Investment
    legislation in the most recent National Defense Authorization
    Act, NDAA. It included language that provided exemptions that
    limit the coverage of passive U.S. financial investments in
    Chinese technology firms and sectors. This is despite numerous
    studies, for example, from the Morgan Stanley, the U.S. China
    Economic and Security Review Commission, and the Coalition for
    a Prosperous America that showed that U.S. firms have billions
    passively invested in Chinese companies, including Chinese
    military industrial complex companies. Thus, how does Treasury
    access whether U.S. funds, particularly retirement funds, such
    as those managing public sector, pensions for teachers, first
    responders, and other American workers are being invested
    unbeknownst to the individual American in companies that
    support adversarial governments or their defense sectors?
        Mr. Pilkerton. Thank you very much for the question.
        The Outbound program is something, as you know, that is
    relatively new, over the course of the last year. Treasury has
    issued regulations around this but given the fact that there
    are certainly other ongoing questions, we also have a number of
    frequently asked questions that are on the website. Now we have
    the COINS Act that we will be able to regulate and administer,
    and we would anticipate that would be a new regulatory regime.
    In other words, new rules will be written and that will
    certainly go through the notice and comment process.
        I think the most important thing maybe gets at the core of
    your question is that people have a level of predictability
    when they are making investments and there are very clear
    guidelines, particularly around the national security risks
    that you highlighted, and you mentioned. So when we look at
    China and when we look at some of the other nations that are
    identified in the COINS Act, those are areas that we will be
    looking at very closely, and we will continue to get
    information out there to the public and work with this
    committee.
        Chairman Davidson. The gentlewoman's time has expired.
        Ms. Waters. Thank you. I yield back.
        Chairman Davidson. Thank you. The gentleman from Oklahoma,
    Mr. Lucas, who is also the chairman of the Task Force on
    Monetary Policy, is now recognized for 5 minutes.
        Mr. Lucas. Thank you, Mr. Chairman, and thank you to our
    witnesses, the Assistant Secretary, for being here today.
        The topics you deal with are some that I have been
    concerned about for the better part of a decade, specifically,
    the issue of ownership of key agricultural equities, like land
    and infrastructure by foreign adversaries, has continued to
    raise alarm bells across the country. That is why I introduced
    the bipartisan Agricultural Risk Review Act to add the
    Secretary of Agriculture as a permanent member of CFIUS for any
    transaction relating to the ag industry and require CFIUS to
    initiate reviews of threats notified by the United States
    Department of Agriculture (USDA). Our annual appropriation
    bills have recognized the need for this language, but we must
    submit this practice into law.
        Mr. Secretary, USDA has committed to working across
    agencies to ensure sensitive ag equities are not controlled by
    foreign adversaries. Can you provide Treasury's perspective?
    How does CFIUS benefit from the Secretary of Agriculture's
    input and would it be helpful for the Secretary to be a
    permanent member for transactions related to ag?
        Mr. Pilkerton. Congressman, thank you very much for that
    question.
        So under the Consolidated Appropriations Act, the USDA
    Secretary is a member of the committee for ag-related
    transactions, and I can tell you that Secretary Rollins is in
    the room for those conversations. Her staff is very engaged--
    Deputy Secretary Vaden--I have met with both of them and spent
    time with them because I know this is an incredibly important
    issue to them as it is to Secretary Bessent.
        In fact, Secretary Bessent and Secretary Rollins signed a
    memorandum of understanding last year to enhance focus on
    agricultural land, biotech transactions, transportation,
    storage, and processing. Secretary Rollins often says food
    security is national security, and I certainly agree with that.
    Her leadership has been very important. So I look forward to
    working with them very closely on these issues as well as
    getting their insight and leadership.
        Mr. Lucas. My bill preserves CFIUS's case-by-case approach
    to ensure that the United States retains a friendly investment
    climate. Can you expand on Treasury's efforts to attract
    investment without compromising national security?
        Mr. Pilkerton. Thank you very much for the question.
        I think one example of that under the America First
    Investment Policy is the Known Investor Program trying to
    ensure that we get more information upfront so that we are
    making these decisions when the capital is coming through, we
    have more information about the underlying transaction and the
    investors.
        We are also going to be traveling the country and spending
    time with various communities to ensure folks are aware of
    CFIUS, aware of the program, aware of the process, and we will
    be doing more roundtables and conferences associated with that,
    and then work very closely with our partners at Commerce and
    State who have an international investment mission of bringing
    foreign direct investment (FDI) back into the United States.
        Mr. Lucas. Secretary, we have a patchwork of State laws
    across the country dealing with the issue of foreign adversary
    ownership of ag equities. How is the Treasury Department
    thinking about the interplay between the various State laws and
    our Federal regulations?
        Mr. Pilkerton. Thank you very much for the question, and it
    is an important one.
        We work closely with our State partners in implementing our
    process. One of the things that I want to be able to do during
    my tenure as Assistant Secretary is to ensure that State
    legislators and State Chambers of Commerce, in particular, are
    aware of CFIUS, its role, and its jurisdiction. I can only
    execute on the laws that this Congress has passed, but I think
    that information sharing, certainly at a high level, but just
    understanding processes, will be very good for those
    relationships and hope to close the loop here.
        Mr. Lucas. In Oklahoma, under State law, we have some very
    strong language dealing with these kinds of issues. My State
    authorities are very enthusiastic about enforcing that. A lot
    of times, they have to be made aware of what is going on in
    order for them to enforce State laws, so this sharing of
    information is critically important. With that----
        Mr. Pilkerton. That is an invitation I humbly accept, sir.
        Mr. Lucas. Absolutely. With that, Mr. Secretary, thank you
    for being here. You have perhaps one of the most critical roles
    when it comes to the future of the economy of this country.
        I yield back, Mr. Chairman.
        Mr. Pilkerton. Thank you.
        Chairman Davidson. I thank the gentleman.
        The gentleman from California, Mr. Vargas, who is the
    ranking member of the Task Force on Monetary Policy, is now
    recognized for 5 minutes.
        Mr. Vargas. Thank you very much, Mr. Chairman, and I also
    want to thank the ranking member for this hearing. I think it
    is a very important one. Again, I want to thank the witness.
        We did hear earlier about the politicization of government.
    I mean, it is ironic because right now--and I will have much
    more to say this afternoon at the Monetary Policy Task Force
    about the politicization of the Justice Department going after
    Chairman Powell. I mean, it is unbelievable to me. You know, it
    is almost as if they are eating their own. I mean, Chairman
    Powell is actually Republican. He is not a Democrat, but I
    think he is one of the most honest, straightforward people I
    have ever met.
        I mean, if there is anyone that is above reproach in the
    sense of his honesty, I think it is Chairman Powell and to go
    after him, to try to force him to be political, I think is
    horrible, and something that is very damaging to our reputation
    as a Nation, and certainly to the Justice Department.
        With all that being said, talking about reputations,
    Secretary, you have a very sterling one. You come very well
    regarded by everyone that you have worked with so far, and I
    was very pleased to see that you are appointed to this
    position. I know the reason for that is your tremendous Jesuit
    education and training at Fairfield University. Congratulations
    for that.
        I do want to ask you about the Nippon Steel deal. So there
    was a reversal, as the chairman said earlier, of that, and I
    wanted to get your sense why--why did that happen? Was there
    politics involved in the overturning of that decision?
        Mr. Pilkerton. Congressman, thank you very much for your
    question, and thank you for your kind words as well.
        With respect to Nippon Steel, I am limited under the CFIUS
    confidentiality requirements as to what I can say but I would
    point you to the June executive order that the President set
    forth setting through the resolution of the national security
    risks.
        Mr. Vargas. Okay. I do understand that you are quite
    limited--I am an attorney myself, and I do understand
    confidentiality and those issues. So again, I will take your
    word on it, and I will also follow up with the reference that
    you gave us.
        I do want to ask, though, about emerging technologies such
    as AI, semiconductors, and the biotech are becoming
    increasingly important in the national security realm. Many of
    these companies hold large amounts of our personal data. What
    measures does CFIUS require to ensure that adversarial actors
    cannot access this sensitive U.S. data such as our health or
    biological information?
        Mr. Pilkerton. Thank you very much for the question,
    Congressman. What--your question is really almost at the core
    of the program. Emerging technologies are advancing so quickly
    that this program has a huge responsibility to oversee that, to
    identify national security risks, and figure out ways to sort
    of move forward within this space.
        So FIRRMA gave us quite a bit of latitude and authority
    over a lot of that technology. There has actually been an
    expansion of the technology as well and the COINS Act on the
    Outbound side.
        When we see a new technology, whether it is AI or quantum,
    we go through a whole host of protocols. We have the entire
    committee process involved in that, and certainly the experts
    are looking at that from law enforcement and from the
    Intelligence Community (IC) but I take your point that because
    things are emerging and advancing so quickly, CFIUS has a
    responsibility to the program, to the administration, to the
    Congress, and, obviously, to the country to ensure we are
    staying ahead of those.
        One of my priorities is to double the size of our research
    team to ensure that we have Ph.D. experts that are working on
    each of these areas as sort of a technology center of
    excellence so we can stay ahead of the curve.
        Mr. Vargas. How will you monitor later on for compliance--
    because I understand that is the initial hit--how are you going
    to be able to monitor it going forward?
        Mr. Pilkerton. Monitor compliance with----
        Mr. Vargas. Yes.
        Mr. Pilkerton. Oh. So there are a lot of different ways
    that we can actually look at that. We can look at the different
    types of protocols that might be around particular
    technologies. Like, so, for example, if you were looking at AI,
    it is usually a stack of products--looking at the particular
    products that an organization may be investing in or what have
    you. That is a very high-level explanation but at the end of
    the day, each of those transactions are going to be reviewed
    not just for technology risk, of course, because we are looking
    360 all the way across the board, but we need to make sure that
    we are protecting our country, protecting our homeland on
    each----
        Mr. Vargas. My time is up. Again, I want to congratulate
    you and wish you good luck.
        Mr. Pilkerton. Thank you very much, sir.
        Chairman Davidson. I thank the gentleman.
        The gentleman from Texas, Mr. Sessions, is now recognized
    for 5 minutes.
        Mr. Sessions. Chairman, thank you very much. Secretary, we
    are delighted that you are here. As you can see, this--not just
    subcommittee, but the members of this committee have important
    questions and consider that the job that you and your team does
    is very important.
        You earlier received a question from my colleague, Mr.
    Lucas. I am from Waco, Texas, and have a district that is
    dominated by agricultural interest in products and Mr. Lucas
    has the same. We have spent a great deal of time attempting to
    work not only with the State, with the Secretary on these sorts
    of issues from agriculture, but also with you, because you are
    the beginning point where people have to, as required by law,
    to talk about the investments they would wish to make.
        We have--both Frank and I, and I am sure most members--have
    come to find out that there were some perhaps intended
    consequences, perhaps unintended consequences, about decisions
    that have been made about foreign ownership of companies and
    contracts and properties that maybe one would not have seen
    altogether except the Chinese or these entities effectively
    used our capitalist system to go and acquire a number of
    things. In other words, when they made an investment, they kept
    going inside our system. Do you track those when someone comes
    and makes an investment and you decide, Well, it looks benign.
    It looks legitimate, but then they then use our system to go
    and buy more property, more land, more product?
        Mr. Pilkerton. Thank you very much for the question.
        The transactions that come through CFIUS are certainly
    tracked and when folks come through for additional
    transactions, that information is obviously reviewed and
    certainly updated----
        Mr. Sessions. So Secretary, you are suggesting to me that
    you continue to track them, and they would be required under
    the law--even though they are originally allowed under the
    requirements to make a purchase--you are saying that then
    anytime they further make an investment, that is required under
    the law?
        Mr. Pilkerton. I want to be clear. Just to go back to what
    I said because I just want to make sure I am absolutely crystal
    clear on this. When someone comes through on a transaction,
    there is underlying due diligence conducted on that person or
    company or what have you. Then if they come through again, then
    that information is certainly updated, included, and there is
    information from the intelligence community and law enforcement
    to support that.
        With respect to your particular question, I am certainly
    happy to engage deeper with you in a different setting.
        Mr. Sessions. I would ask that take place because I think
    that sets in place something that we, by and large, have not on
    this side been looking and tracking, but at some point we
    figure out, so I am very available. Mr. Lucas and I are very
    available, and we would be very pleased to establish that, but
    I think that this is important for us to understand that when a
    benign transaction comes in, or something we think is benign,
    that we still understand that. So, I want to thank you.
        I think I have an additional question, but it is very
    germane to the question that I was asking, so I will wait. If
    you would please have someone in your organization get in touch
    with me, I would like to set this up and then ask those
    questions that are better offline.
        I want to thank you and your team for your service to this
    country. Mr. Chairman, I yield back my time.
        Chairman Davidson. Thank you, Mr. Sessions.
        The gentleman from Illinois, Mr. Casten, is now recognized
    for 5 minutes.
        Mr. Casten. Thank you for joining us today, Mr. Pilkerton.
    Thank you, Mr. Chairman.
        So CFIUS's authority is granted by Congress to negotiate,
    impose, enforcing national security agreement to mitigate the
    risks associated with any particular transactions. Looking at
    your website today, it is essentially what your website says is
    your role. Do you agree that is the basic scope of CFIUS?
        Mr. Pilkerton. Yes, sir.
        Mr. Casten. I ask that because I want to follow up on your
    exchange with Mr. Vargas about the Nippon Steel-U.S. Steel
    deal, and I want to just focus on public information. Not
    trying to get you into any confidential things you cannot
    disclose.
        Trump reversed Biden's decision to block the proposed deal
    between U.S. Steel and Nippon Steel, and he allowed the
    transaction to proceed on the condition that the parties enter
    into a national security agreement. The terms of that
    agreement, which are public, personally grant President Trump
    veto power over major business decisions, including off-shoring
    of production, changing the investment schedule, their business
    model, the specific products they make.
        Furthermore, President Trump is listed by name--again,
    public information--in U.S. Steel's amended corporate charter
    filed with the Securities and Exchange Commission.
        What I want to know is what was the process within CFIUS to
    authorize Donald Trump's name to appear in the filings and give
    him direct veto powers over major corporate decisions?
        Mr. Pilkerton. Congressman, thank you very much for the
    question.
        I will reiterate, as you know, that there is CFIUS
    confidentiality related to my role, which is mandated by
    Congress. I know you indicated that you are referencing public
    information, but I think it is important to lay that
    foundation.
        With respect to the decision process that was made there,
    that information is contained in the June executive order.
        Mr. Casten. So was CFIUS responsible for that or was it
    delegated to a CFIUS member agency?
        Mr. Pilkerton. Once again, I have to rely on the
    confidentiality----
        Mr. Casten. I am not asking what the decision was. I am
    asking who made the decision. Was it made in your office or was
    it not made in your office?
        Mr. Pilkerton. The confidentiality provisions that CFIUS
    set forth by Congress are very broad, so I am not in a position
    to be able to speak to----
        Mr. Casten. I am sorry that you feel the need to evade. Can
    you then point to any prior cases where CFIUS authorized a
    President to exercise a direct role over a private company's
    operations?
        Mr. Pilkerton. So in my role, having been in this role for
    about a week, once again, cannot speak to any particular case--
    --
        Mr. Casten. So it is over the entire CFIUS----
        Mr. Pilkerton. What I would like to say, if I may, is that
    as part of mitigation agreements, there are, from time to time,
    veto rights on certain types of things----
        Mr. Casten. Let us be clear. The President as an individual
    is named. I am asking if there is any precedent for that in the
    history in CFIUS because according to Stephen Heifetz, former
    CFIUS attorney, he said that this is--this is unprecedented. Do
    you disagree with Mr. Heifetz?
        Mr. Pilkerton. Without seeing the actual document that you
    are talking about, I cannot speak to that, but I will just say
    that there is a CFIUS confidentiality component here, and I am
    unable to speak----
        Mr. Casten. Okay. Is CFIUS considering any other agreements
    that have these golden share provisions?
        Mr. Pilkerton. With respect to the statutory
    confidentiality that is required, I am unable to speak to any
    particular matters that are going----
        Mr. Casten. So for all we know, for all we know--and you
    cannot shut--you cannot say that they are not looking to
    commingle the personal interests of President Trump and the
    interests of private sector economies. You cannot affirmatively
    say that is not happening?
        Mr. Pilkerton. Sir, that is not what I said.
        Mr. Casten. I asked--are there any other golden share
    agreements where President Trump would be named and would be
    named in the Securities and Exchange Commission (SEC) filings
    that you are reviewing? Yes, no, or you cannot say?
        Mr. Pilkerton. Under the confidentiality requirements, I
    cannot speak to any particular case.
        Mr. Casten. Okay. Well, let us--let us talk more
    philosophically then because this is not a one-off.
        Last year, the Trump Administration acquired a 10 percent
    stake in Intel, making the U.S. Government their largest
    shareholder. That is not the Republican Party that I thought I
    knew. I think when the government takes control of private
    entities it is called socialism.
        Setting aside what Trump may do, that creates a massive
    conflict of interest for any future administration, because
    simply the act of trying to unwind that could put huge downward
    pressure--threatening to unwind that could put huge downward
    pressure on their share price. You used to be the compliance
    officer at J.P. Morgan. What is your message, as you sit here
    today, to corporate boards who put an emphasis on regulatory
    compliance, who like the rule of law, who would like to be
    independent of the government, and they are confronted with the
    threat of direct government action? Because as you sit here,
    you cannot tell us whether President Trump is going to do this
    again.
        Mr. Pilkerton. Congressman, I certainly appreciate the
    question, and I certainly believe very strongly in regulatory
    compliance, very strongly in the rule of law. When it comes to
    the particular matter that you are talking about, I would refer
    you to the Department of Commerce and the team there that
    worked on that matter.
        Mr. Casten. I am extremely disappointed in your answer. I
    yield back.
        Chairman Davidson. I thank the gentleman.
        The gentleman from Kentucky, Mr. Barr, who is the chairman
    for our Subcommittee on Financial Institutions, is now
    recognized for 5 minutes.
        Mr. Barr. Secretary Pilkerton, thank you for your service
    to the country. Congratulations on your appointment to this
    important assignment.
        As of early 2026, President Trump had announced up to $9
    trillion in total foreign direct investment commitments that he
    negotiated. Just as an example, UAE, $1.4 trillion investment
    framework; Qatar, $1.2 trillion; Japan, $550 billion in key
    industries, including energy and AI infrastructure investments;
    Saudi Arabia, $600 billion investments in trade over 4 years,
    later expanded to almost a trillion; South Korea pledged $350
    billion in investment with an additional commitment to purchase
    100 billion in U.S. energy products.
        The President has been remarkably successful in just 12
    months' time to negotiate massive amounts of foreign direct
    investment in the United States. Consistent with that, I
    applaud your office's Known Investor Program. How important is
    it that as you fulfill your national security obligations
    implementing CFIUS that we keep this open investment climate,
    especially with respect to these key investments that President
    Trump has negotiated?
        Mr. Pilkerton. Congressman, thank you very much for your
    question, and thank you for your leadership on the recent
    outbound legislation as well.
        With respect to this question, I think it is incredibly
    important. The America First Investment Policy made it very
    clear that while national security is going to remain a
    priority, America is open for business and America is open for
    business in a whole host of areas. You talk about the
    technology pieces, AI and quantum and other areas, but we
    really want to bring in business from all different areas,
    because, obviously, the benefit to that is not just to those
    business to America itself but to those communities, jobs,
    research and development. Obviously, it is a whole host of
    things.
        So when it comes to that money that is actually coming in,
    I see it as part of my responsibility to ensure that the
    program is in place, whether it is a known investor or the
    standard CFIUS program, has all of the efficiencies that money,
    assuming that it passes the national security protocols, is
    able to come into the country and be put to work.
        Mr. Barr. Well, thank you. At the end of last year, as you
    just noted, the President signed into law the National Defense
    Authorization Act, which included my legislation, the
    Comprehensive Outbound Investment National Security, or COINS,
    Act, also known as the FIGHT China Act, the Foreign Investment
    Guardrails to Help Thwart China Act.
        The COINS Act ensures that Americans are not unknowingly
    funding the military industrial complex of our adversaries by
    codifying and enhancing the Trump Administration's America
    First Investment Policy and the Outbound Investment Security
    Program.
        Your office, the Office of Investment Security, is
    responsible for implementing the statute and overseeing the
    prohibition and notification investments into certain sensitive
    technologies.
        Treasury released frequently asked questions (FAQs) at the
    end of last year expressing awareness of the new obligations
    under the law. Under those FAQs, you have 450 days after
    enactment to issue regulations. What is your timeframe?
        Mr. Pilkerton. So thank you for the question. Four hundred
    fifty days is what we have, and I have been on the job about
    eight. I have met with the team, and we are looking at that
    very closely.
        As I mentioned before, the regulatory process for this will
    be full notice and comment. Of course, there will be overlap
    from the regs that are in place but based on your leadership
    and the work of folks around this committee, there are new
    components to this program, including new technologies. So we
    will be getting a lot of information out there.
        Mr. Barr. Let me just move on really quick.
        Mr. Pilkerton. Yes, sir.
        Mr. Barr. The sanctions title and the list coordination
    provisions are administered by the Office of Foreign Assets
    Control (OFAC). You have the notification and prohibitions on
    sensitive technologies piece. How will you collaborate with
    OFAC on implementation of COINS?
        Mr. Pilkerton. With respect to that language, we are
    examining that very closely. We coordinate with OFAC in our
    day-to-day work, as you know, and we will continue to do that
    closely through this process.
        Mr. Barr. Thank you. Meta is currently trying to acquire
    Singapore-based, Chinese-founded Manus, an artificial
    intelligence startup. Earlier this year, BlackRock backed the
    acquisition of key ports in the Panama Canal. Both of these
    acquisitions are examples of outbound investments that actually
    promote U.S. national security and competitiveness.
        Fortunately, Section 8521 of the NDAA includes a national
    interest exemption that states, quote, the Secretary is
    authorized to exempt from prohibition any activity determined
    by the President to be in the national interest of the United
    States.
        While I recognize Treasury still needs to go through
    rulemaking, do you agree that there are national security
    benefits of certain outbound investments, and will you aim to
    be certain that the program is designed properly so we do not
    inhibit outbound investments that advance our national
    security?
        Mr. Pilkerton. I certainly agree with that, Congressman. I
    think that there are certain investments that--obviously, we
    have to assess everything for national security concern, as you
    know. If there are investments that pass muster on those and
    present opportunities and provide benefits to the American
    people, once again, with the national security constraints in
    mind, then I think there is certainly a lot of benefit to that.
        Mr. Barr. I have run out of time, but our intention in this
    bill was red light/green light. We embedded in the process a
    process for nonbinding feedback to investors so that they are
    given certainty and clarity about what is permitted and what is
    prohibited.
        Not a question, just a commentary on legislative intent
    here. We hope you provide investors with that red light/green
    light.
        Mr. Pilkerton. Thank you.
        Mr. Barr. I yield back.
        Chairman Davidson. Thank you, Mr. Barr.
        The gentleman from Illinois, Dr. Foster, who is also the
    ranking member of the Financial Institutions Subcommittee, is
    recognized for 5 minutes.
        Mr. Foster. Thank you, Mr. Chair, and Mr. Secretary--
    Assistant Secretary Pilkerton.
        At the core of CFIUS' work is its being able to understand
    who the beneficial owner of a covered transaction is and
    whether they or their affiliates have interests that run
    counter to the security of our country. This work requires
    significant due diligence that I believe was undermined by this
    administration's move to gut the Corporate Transparency Act,
    which aimed to crack down on anonymous shell companies that
    conceal the true beneficiaries of businesses operating in the
    United States.
        Now, identifying the interests of businesses, it is going
    to become more difficult and more important with advances in
    artificial intelligence. Specifically, agentic AI, which is
    coming at us fast and it is going to really dominate the next
    decade in financial services, has become a primary concern of
    mine.
        We are going to--you know, we have grown tolerant of the
    use of shell companies to conceal ownership within limits, but
    historically there has always been a human in the loop
    somewhere down the line. Now we are going to have money flying
    around under the control of AI agents signing contracts, doing
    deals at the speed of AI.
        So other countries are looking at this, and we are starting
    to see international work developing the standards for
    communications and conversations and contracts between AI
    agents. Every country--every advanced country, except the
    United States, has an understanding that when my agent contacts
    your agent, they will exchange information about who the
    legally traceable human is that is responsible for that agent's
    actions.
        So what is the--how is this going to work if the answer you
    get back, well, I am an agent and I am working for an anonymous
    shell corporation and I am not going to tell you who is behind
    it? Is that not just going to just make the United States not a
    player in this new ecosystem? How do you intend to handle that
    problem?
        Mr. Pilkerton. Thank you very much for the question,
    Congressman.
        Over the course of the CFIUS process, as I mentioned, we
    have a number of committee members, many of the larger Cabinet
    agencies. We also work very closely with the intelligence
    community and law enforcement and, of course, have access to a
    variety of different databases associated with that. So,
    regardless, the CFIUS process will continue to be diligent,
    continue to be thorough and fulsome.
        So with respect to our work, we will move forward to
    identify national security risks of the investors of those
    companies as well as the transaction itself.
        Mr. Foster. How is that even going to work in real time?
    You know, when--if someone from EU and Korea or Japan wants to
    engage in an agentic transaction. They get out their cell phone
    and they say, here is my legally traceable identity. You do
    your biometric login, and they present a secure digital ID that
    every citizen of the EU is going to have I think by the end of
    this year, every citizen of the U.K., every citizen of Korea
    and Japan have had for more than a decade, I believe.
        So we do not have that. What we have is a hodgepodge of a
    handful of States that are getting mobile ID, digital driver's
    licenses, and that is the best we have. As a result, it seems
    like we are really going to not be able to play in the next
    stage of development, because no one is going to trust any
    agent that is unwilling to say, here is the legally traceable
    human behind the deal I am offering you.
        I urge you to have a look at this and try to get ahead of
    the curve on this whole operation, because it is going to be
    important and it will be a huge--it will be a competitive
    disadvantage to the United States if we do not have a way of
    actually understanding who authorized some agent and who is
    going to take responsibility for that agent's action, because
    this is going to be the dominant activity in financial
    services.
        Let us see. Can we expect--actually, on the specific issue
    of privacy, preserving secure digital credentials--this is
    something that the Biden Administration came in and promised
    they would do something to move the ball forward.
        Do you have any insight into what the plan of this
    administration is going to be doing in terms of giving U.S.
    citizens the ability to prove they are who they say they are
    online? Is that on the agenda?
        Mr. Pilkerton. With respect to data and privacy information
    that come through the CFIUS process, that is one of our highest
    levels of concern, and that was outlined in FIRRMA. We conduct
    analyses and put together processes and procedures to ensure
    that data is protected.
        Once again, that is through the CFIUS process. It appears
    your question may be alluding to some other agencies, perhaps
    Department of Homeland Security (DHS) or others, and I cannot
    speak to that.
        Mr. Foster. Okay, but just when our agents start talking to
    each other and doing deals, you cannot convene a committee to
    figure out even who the principals are in the deal. You have to
    have standards, and so you should get involved in that
    conversation. Thank you.
        Mr. Pilkerton. Thank you.
        Mr. Foster. I yield back.
        Chairman Davidson. Thanks, Mr. Foster.
        The gentleman from Texas, Mr. Williams, who is also the
    chairman of the Small Business Committee, is now recognized for
    5 minutes.
        Mr. Williams of Texas. Thank you, Mr. Chairman.
        Mr. Pilkerton, thank you for being here today.
        The United States has long benefited from being the world's
    top destination for foreign investment, and that openness has
    helped drive jobs, innovation, economic growth. At the same
    time, we face increasingly sophisticated threats from
    adversarial nations that seek to exploit our openness to gain a
    strategic advantage.
        Now, getting the balance right is critical--we have talked
    about that much today--but both for our security and our
    competitiveness. Mr. Pilkerton, how do you balance protecting
    national security while preserving the United States'
    reputation as the safest and the most attractive power to
    invest?
        Mr. Pilkerton. Congressman, thank you very much for your
    question and thank you for your leadership on Small Business.
        The question that you point out is really at the core of
    President Trump's America First Investment Policy. As I said in
    my opening statement, national security will always be the
    priority of the CFIUS program, but the opportunity to bring in
    foreign direct investment and share to the world that America
    is open for business is incredibly important.
        The way that I can do my part in both of those things is to
    ensure that the program that we have at CFIUS remains robust,
    thorough, and understandable to the parties. It has got to be
    efficient. As I said before, process, process, process and that
    process does include the analysis of the risks and the
    mitigation, potentially, associated with them.
        The other thing that I can do is ensure that people
    understand the process. As I mentioned before, I would like to
    be able to get out into the communities, talk to the State
    chambers as well as travel internationally with our State and
    commerce partners and make sure they understand the process so
    that, when they come through it, we can come and have an
    understanding and a conversation and ensure that it is as
    efficient as possible as it can be to bring those dollars into
    the country.
        Mr. Williams of Texas. All right. Second, CFIUS has been
    given expanded responsibilities over the past several years,
    including authority over noncontrolling investments and certain
    real estate transactions. As foreign investment strategies
    evolve and threats become more complex, it is important for
    Congress to understand whether the current framework is keeping
    pace.
        So looking ahead, where do you see the biggest gaps in
    CFIUS authority that Congress may need to address?
        Mr. Pilkerton. At this time, once again, having been on the
    job for a week, I am conducting sort of my own risk assessment
    of that; working with the team and sort of finding where there
    may be potential gaps or things to think about.
        To date, I feel that the authorities there are strong and
    to date, I feel like we have what we need to do our job and
    look at all the national security risks that are at issue. If
    at any point I do not, I have absolutely no hesitation to come
    back to this committee, because I know that there is a lot of
    nonpartisan interest to help advance this program. I would
    certainly engage with both sides of the aisle to advance that.
        Mr. Williams of Texas. Thank you. My last question, I want
    to discuss the 2017 purchase of a trailer park located at
    Whiteman Air Force Base. As you know, Whiteman is home to our
    Nation's B-2 Stealth bomber fleet, one of the most sensitive
    and strategically important assets in the U.S. military. The
    acquisition of a property that is less than 1 mile away from
    Whiteman's runway raises serious national security concerns,
    particularly given the potential for persistent surveillance,
    intelligence collection, or interference with base operations.
        So quickly, this property is reportedly one of several
    properties that have been purchased by individuals with alleged
    ties to the Chinese Communist Party (CCP) intelligence. So the
    question is, Mr. Pilkerton, without commenting specifically, is
    this the kind of transaction that CFIUS would typically want to
    review for national security purposes?
        Mr. Pilkerton. Thank you very much for the question,
    Congressman.
        As you identified, I cannot speak to any specific type of
    transaction, but protecting our national security where
    transactions are close to military bases or sensitive sites is
    another priority for CFIUS. In fact, the NDAA had a component
    entitled Protect Our Bases Act.
        Those are things that we are doing. We will certainly
    implement that law and work through the CFIUS process, but it
    is critical that we protect the sensitive sites, including
    military bases.
        Mr. Williams of Texas. Absolutely. I yield my time back.
    Thank you for being here.
        Mr. Pilkerton. Thank you.
        Chairman Davidson. Thank you, Mr. Williams.
        Another gentleman from Texas, Mr. Gonzalez, is now
    recognized for 5 minutes.
        Mr. Gonzalez. Thank you, Mr. Chairman.
        Thank you, Mr. Pilkerton, for being here with us this
    morning. Mr. Pilkerton, foreign investment plays a major role
    in the great State of Texas, as you may know. We are deeply
    integrated. We are a deeply integrated cross-border region
    economically, culturally, and financially, with families,
    businesses, and investors operating on both sides of the
    border.
        While I fully understand and support the Treasury's
    responsibility to protect national security and combat illicit
    finance, I am somewhat concerned that the increasingly punitive
    or opaque Federal actions, whether through CFIUS reviews or
    heightened compliance burdens on banks and financial
    institutions or related Treasury tools, will have unintended
    consequences for communities like ours.
        Actions like these will discourage legitimate foreign
    investment and push capital to other countries where the United
    States has less visibility or leverage. We already have some
    foreign nationals that normally used our banks moving to Canada
    and Europe.
        My question is, how is CFIUS balancing the need to
    safeguard national security while maintaining an open
    investment posture for lawful, good-faith investments and
    investors to ensure capital remains in places like Texas and
    other places around the country?
        Mr. Pilkerton. Thank you, Congressman. It is an incredibly
    important question and one that we look at every day.
        In the America First Investment Policy by the President, he
    specifically called out overburdensome mitigation agreements.
    These are parties, as you know, that come through the process.
    We have identified potential risks, and then we work with the
    parties to determine are there controls that we can sort of put
    on this process so that we can mitigate those risks to a point
    where it is acceptable to the committee.
        In my experience, I certainly understand and appreciate why
    those mitigation agreements are necessary, and they will
    continue to the extent it is applicable and appropriate for a
    certain act. As the President has called out the overburdensome
    piece, I do think we need to pay very close attention to that
    to ensure that folks that can come through the process and are
    appropriate to come through the process can do so in an
    efficient manner, and not just that the process works, but that
    they are aware of that, right.
        Because, to your point, I want them to be able to take a
    look at the United States and land in the United States and
    sort of understand the process, which is one of the reasons
    that----
        Mr. Gonzalez. Well, my concern now is we have banks
    actually closing foreign deposits, closing the accounts because
    of the overburdensome policies that have come from this
    administration and prior.
        We need to--I mean, Chase, which is one of the larger
    banks, just closed hundreds or thousands of accounts in south
    Texas from foreign nationals just because they just could not
    deal with the compliance. These were good, legitimate, solid
    depositors that had been banking in the United States for a
    long time, and we are losing them to Canada and Europe and
    other countries around the world.
        I will be candid. Actions taken by this administration make
    it difficult for me to trust that the current strategy is
    actually supporting investment and economic stability in border
    regions. I would like to ask you to please take a close look at
    this because it is hurting States like Texas and other places
    and it is not in the interest of our country.
        What specific steps are being taken to ensure--I know you
    are saying you are doing some--what specific steps are being
    taken to ensure that heightened scrutiny for certain
    jurisdictions like border States does not inadvertently
    penalize communities like ours and continue to promote commerce
    and foreign deposit in American banks? Are you all doing
    something strategically targeted for this purpose?
        Mr. Pilkerton. I would like to make the distinction between
    sort of a CFIUS transaction and then perhaps the regulatory
    rules around these that are overseen certainly by the Treasury
    Department, in coordination with the OCC and others. Those are
    done in our Office of Domestic Finance, but I am happy to
    engage with them and certainly would point you to them as well.
    We do not oversee some of these----
        Mr. Gonzalez. Thank you. Please do so.
        Second, we are seeing a very real strategic competition
    playing out in Latin America, particularly as BRICS countries
    continue to expand their economic footprint across the region.
        Even after the United States supported a bailout package
    for Argentina, we saw Argentina deepen its economic ties with
    China by exporting soybeans and other commodities there,
    signaling an alignment with BRIC and undermining American
    interests.
        That should be a warning sign for all of us. If our
    investments posture is perceived as unpredictable or overly
    restricted or disconnected from regional realities, we risk
    losing influence, not because we lack capital, but because we
    lack a coherent strategy that aligns security, economic growth,
    and partnership.
        How is this administration integrating its inbound and
    outbound investment strategies to ensure the U.S. remains the
    preferred partner in the region, especially for our farmers
    that are getting killed just with tariffs and complications and
    lack of labor? Are we doing something to improve those
    conditions?
        Chairman Davidson. I would just ask that response be in
    writing. The gentleman's time has expired.
        Mr. Gonzalez. Thank you.
        Chairman Davidson. I thank the gentleman.
        The gentlewoman from California, Mrs. Kim, is now
    recognized for 5 minutes.
        Mrs. Kim. Thank you, Chairman Davidson and Ranking Member
    Beatty, for holding today's hearing. To you, our witness, thank
    you very much for joining us.
        While China's investment in U.S. agricultural land has
    garnered much congressional attention, I would like to first
    focus on second-class property purchases that is greenfield
    investments. These are parcels of land that are meant for real
    estate or industry or manufacturing development and those
    greenfield investments near military installations and
    sensitive sites fall squarely under CFIUS jurisdiction. In
    successive reports like U.S.-China Economic Security Review
    Commission, it has stressed the need to review those
    investments.
        So, Mr. Pilkerton, what is CFIUS' procedure for determining
    which greenfield investments the committee review, both in
    terms of jurisdiction and in terms of substance?
        Mr. Pilkerton. Congresswoman, thank you very much for that
    question.
        CFIUS has jurisdiction over certain greenfield investments
    via its real estate authority with the purchase and sale of--
    and leasing, rather, of land areas.
        We are looking at that question very closely. There is some
    international information around greenfield investments, and we
    are assessing that to make a determination as to what our
    authorities would look like in that space to balance the
    national security risks as well as the open investment posture
    of the country.
        Mrs. Kim. Because China's economic threat has arrived in
    the mainstream only in recent years, I imagine the United
    States has neglected the opportunity to evaluate a myriad of
    foreign investments. This leads me to believe that there is a
    substantial timeframe for which greenfield investments have not
    been accounted.
        Do you believe that there is a reasonable timeframe to look
    back and conduct CFIUS greenfield review that balances both
    staff resources and national security?
        Mr. Pilkerton. So for transactions that come through CFIUS
    and have been cleared, they have a certain safe harbor from re-
    review. That having been said, there can be renegotiation of
    mitigation agreements and things if there are changed
    circumstances. I think, to your question, as we look at this
    greenfield space, we will be looking to perhaps examine it more
    closely.
        I think another point that you make that is inherent in the
    question is the idea of non-notified transactions. If there are
    transactions that we would have jurisdiction over, so if there
    are certain technology transactions that may have started or
    what have you, that is something that the administration is
    very, very focused on.
        Mrs. Kim. Can you tell me in the last year how many
    greenfield investments CFIUS has looked into?
        Mr. Pilkerton. I do not have that number handy, but I am
    happy to get back to you on that.
        Mrs. Kim. Okay. Well, let us shift gears beyond greenfield
    investments.
        I would like to discuss the implications of Chinese
    acquisitions of companies that have the potential to damage
    American interests under CFIUS jurisdiction, like last year
    Epic: It is an education software company that recently
    declared bankruptcy. That was acquired by a Chinese holding
    company, TAL, T-A-L, Education Group.
        I know that I, along with many of my Senate colleagues,
    have concerns that this acquisition could result in the chance
    for the CCP to access the students' private data and also
    conduct the influence operations against American students.
        So can you talk about how CFIUS determined which non-
    notified transactions it should request a declaration from,
    especially acquisitions of companies that possess the
    Americans' personal data? That is a great concern for many of
    us.
        Mr. Pilkerton. No. I certainly share that concern. While I
    cannot speak to any particular matters, as you are aware, we
    need to ensure that any transaction that comes through CFIUS,
    there is no sort of per se prohibition per countries but we
    want to ensure that we are constantly evaluating some of our
    most critical national security risks, and I think data and
    privacy is one of those.
        So when we look for non-notified information, when we get
    information that comes in, it goes through a standard review
    process to make a determination as to whether it should have
    gone through CFIUS in the first place and it kind of goes
    through that exact same lens that a covered transaction or
    filing would go through anyway, including the data piece that
    you mentioned.
        Mrs. Kim. Thank you for your time.
        I yield back.
        Chairman Davidson. Thank you.
        The gentleman from California, Mr. Liccardo, is now
    recognized for 5 minutes.
        Mr. Liccardo. Thank you, Mr. Chair.
        Assistant Secretary Pilkerton, thank you for your testimony
    today. I appreciate your recent emphasis on protecting the
    sensitive personal data of Americans. I think CFIUS was
    prescient and correct in identifying, for example, TikTok and
    the implicit control of the Chinese Government of sensitive
    personal data of millions of Americans as a potential threat to
    national security.
        I know you cannot talk about specific cases, but I am
    guessing you would also agree that was a sensible thing for
    CFIUS to be doing. Is that fair to say?
        Mr. Pilkerton. While I cannot speak about a particular
    case, it is certainly very important to protect privacy data of
    American people.
        Mr. Liccardo. The statutory language that describes CFIUS'
    scope and jurisdiction describes a focus on any investment by a
    foreign person in any unaffiliated United States business
    that--I am using ellipses periods here to get to the chase--
    that maintains or collects sensitive personal data of U.S.
    citizens that may be exploited in a manner that threatens
    national security.
        Does that sound familiar?
        Mr. Pilkerton. Yes.
        Mr. Liccardo. So I would like to provide you with a
    hypothetical, knowing that you cannot discuss a particular
    case. I guess before I get there, I understand it is standard
    practice for you and your staff to engage in confidential
    briefings with Members of Congress, members of this committee
    about individual cases. Is that fair?
        Mr. Pilkerton. There has certainly been a history of that
    in the past, yes.
        Mr. Liccardo. Okay. You can probably tell I am building
    toward that request.
        I would like to provide you with a hypothetical. I want you
    to imagine a conglomerate media company that had the sensitive
    personal data of more than 100 million Americans, including
    what you all know is typically collected by many media or
    online companies around location information, viewing habits,
    page views, personal financial data, credit cards, et cetera.
        I want you to imagine that conglomerate also had the
    ability to use its technology and its outlets to communicate
    instantly with hundreds of millions of Americans, and that
    there was a proposed purchase of that American media
    conglomerate by a group of investors. Among those investors
    were some foreign entities, including sovereign wealth funds.
        Now, in the abstract, assuming nothing more, that you knew
    nothing more, that might be something that would get a on
    CFIUS' radar. Is that fair to say?
        Mr. Pilkerton. Congressman, thank you very much for the
    question. I certainly appreciate that this scenario is a
    hypothetical.
        If there is any scenario that potentially could include
    national security risks that the CFIUS program would have
    jurisdiction over, and under FIRRMA components of that, maybe
    data privacy, that would certainly be something that
    potentially could be under consideration.
        Mr. Liccardo. I appreciate that, because I will push the
    hypothetical a little further and offer that the sovereign
    wealth fund was controlled by an autocratic ruler that would be
    investing tens of billions of dollars in equity in this
    proposed takeover. That autocratic ruler directed the brutal
    killing of a foreign journalist who worked for an American
    newspaper in 2018, according to United States intelligence
    reports that were published. That autocratic ruler and his
    nation spies on activists, journalists, and foreign entities
    using technological tools like Pegasus and Predator. According
    to independent international reports, various non-governmental
    organizations (NGOs) and that ruler engaged in a pattern of
    what Facebook reported to be, quote, coordinated inauthentic
    behavior in 2019 when Facebook took down 350 of its phony
    accounts that were used in a mass disinformation campaign to
    manipulate public behavior.
        Would any of those kinds of facts be the kinds of facts
    that would be relevant in a consideration of CFIUS exerting its
    review and perhaps intervention?
        Mr. Pilkerton. Sir, any transaction that comes through
    CFIUS, we do make an assessment of the parties, of the
    transaction, their history, any other underlying national
    security risks.
        So without speaking to any particular scenario, that would
    be something that would be standard in any transaction that we
    would see that we would have jurisdiction over.
        Mr. Liccardo. You might have already suspected that I am
    referring--that particular ruler is Mohammed bin Salman, who is
    the head of Saudi Arabia and, obviously, they have a sovereign
    wealth fund that is involved in this proposed takeover of a
    very important media property in the United States, Warner
    Brothers Discovery, as part of the Paramount deal. I know this
    is far from anywhere near a finish line.
        I would like to request a confidential briefing of this
    matter and CFIUS' role. I have today submitted a letter to the
    CEO of Paramount who is involved in that potential takeover,
    urging them to voluntarily submit to CFIUS and your review,
    because I think it is a matter of national security.
        Would you be willing to grant the request for a meeting?
        Mr. Pilkerton. Once again, with respect to confidentiality,
    I am unable to confirm whether any transaction is or is not
    part of the CFIUS portfolio. So I would like to be clear about
    that.
        Second, I am happy to have the legislative team at Treasury
    engage with your staff.
        Mr. Liccardo. Thank you very much, sir.
        I yield.
        Chairman Davidson. I thank the gentleman.
        The gentleman from Tennessee, Mr. Ogles, is now recognized
    for 5 minutes.
        Mr. Ogles. Thank you, Mr. Chairman.
        If I may, one of our colleagues from the other side
    criticized the Trump Administration and their 10 percent stake
    in Intel without mentioning the strategic value that--what role
    that may play in national security.
        I want to look backward to an obvious example of
    precedents. So if you go to late 2008 and 2009, you had the
    Troubled Asset Relief Program, officially known as TARP, where
    the Treasury took stake in multiple corporations at a time of
    economic difficulty because it was of strategic value both from
    an economic but a national security standpoint.
        For example, General Motors' $50 billion, which was at that
    time about a 60.8 percent stake in the company in equities.
    Chrysler was $12 billion, which was later sold to Fiat, which
    was a 9.9 percent stake.
        Then you look to the financial services industry, which
    would obviously be the jurisdiction of this committee, where
    Citigroup and Bank of America received $45 billion in equity
    purchases and then AIG had a very complicated structured
    purchase agreement of $182 billion, which roughly was a 79.9
    percent stake.
        So there is a historic precedence for Treasury getting
    involved when it is to the benefit of the United States of
    America and failing to mention that--and I serve as the
    chairman of Homeland Security Cyber Subcommittee, where we deal
    with these types of conversations on equities and foreign
    interests and how it affects our country. Obviously our biggest
    adversary is China.
        That being said, I want to thank the chairman, Mr.
    Pilkerton for being here. You know, we need a defining moment
    in the global economy, a moment when our prosperity and our
    security is inseparable.
        The Committee on Foreign Investment in the United States,
    or CFIUS, is one of the Nation's most important lines of
    defense. Its job is to scrutinize foreign capital that could
    intentionally or inadvertently undermine American national
    security. That mission has never been more vital. Again, when
    you look at the AI and the cyberspace, interconnectivity here
    is almost unfathomable.
        For years, the People's Republic of China has blurred the
    lines between commercial activity and State power. Unlike
    Western markets, where private companies operate independently
    of government direction, China's corporate sector exists within
    a political system that compels the cooperation with the
    Chinese Communist Party's strategic objectives: Beijing's Made
    in China 2025 industrial plan.
        Its dominance of key supply chains, from rare earth
    minerals to semiconductors, and an expansive industrial subsidy
    are all aligned to exploit open economies while denying
    reciprocal access to ours.
        This is not a benign investment. It is a long-term strategy
    to acquire sensitive technologies, critical infrastructure, and
    intellectual property that can be used to China's advantage in
    future conflict or economic leverage.
        At the same time, the Islamic Republic of Iran has
    repeatedly used opaque corporate structures and front entities
    to evade sanctions and funneled hard currency into its military
    and security apparatus. Tehran's network of proxies across the
    Middle East, its sponsorship of terrorism, and its systematic
    efforts to gain access to Western capital and technology pose a
    clear and present threat to U.S. interests.
        Iranian actors have used complex ownership chains to mask
    control of entities that operate across borders, a strategy
    that without vigilant scrutiny could allow hostile regimes to
    penetrate or influence American technology and infrastructure
    markets.
        CFIUS must remain robust, discerning, and unafraid to use
    its full statutory authority to scrutinize transactions
    involving entities tied to these regimes.
        I want to underscore, Mr. Chairman, as someone who sits on
    the Cyber Subcommittee--I serve as chairman, I spend a lot of
    time in the Sensitive Compartmented Information Facility (SCIF)
    in a classified setting--we are attacked daily by China, by
    Iran, by North Korea. They want access to our markets. They
    steal our technologies and it is imperative that we support
    CFIUS in its mission.
        Mr. Secretary, Assistant Secretary, the Chinese Communist
    Party requires companies under its jurisdiction to cooperate
    with State intelligence and security services, regardless of
    how these companies present themselves abroad. Given that
    reality, does CFIUS treat transactions involving Chinese-
    controlled entities as presumptively high risk even when those
    entities claim to be a private or are routed through third
    countries? Sir?
        Mr. Pilkerton. Congressman, thank you for the question. As
    you know, under the CFIUS program, there is no per se
    prohibition from a particular country. That having been said,
    with respect to China, I am aware of some of the distinct risks
    that you are talking about.
        I think taking it at a higher level with respect to the
    impact of things like cyber, like impact on military
    technologies, intelligence technologies, those areas are
    particularly important for the committee and we rely upon the
    entire committee around the table to help us and inform us of
    those national security risks so we can make a determination as
    to whether they exist, whether we can mitigate, or whether to
    prohibit a transaction.
        Mr. Ogles. Thank you.
        Mr. Chairman, I yield back.
        Chairman Davidson. Thank you.
        The gentleman from Iowa, Mr. Nunn, is now recognized for 5
    minutes.
        Mr. Nunn. Well, thank you, Mr. Chairman, and thank you for
    CFIUS for being with us here today.
        I am going to be very clear: The U.S. homeland is not for
    sale. That means not our military bases, not our family farms,
    not our key industries.
        My home State of Iowa has seen agricultural espionage
    before. Chinese spies were stopped at Des Moines Airport for
    stealing seeds, literally going to a farm field and pulling
    them out of a test unit but because of good work here in the
    United States, we were able to stop those agents at the Des
    Moines Airport before they fled back to China. Now they can do
    it blatantly overline.
        The challenge here is that, as I sit on the China Select
    Committee and understand the CCP's tactics to penetrate the
    U.S. market and establish a presence here in the United States,
    we need a CFIUS program that works. We welcome foreign
    investment in the United States, but there needs to be a more
    thorough and transparent process for understanding and
    addressing the entities of concern.
        I think of CFIUS like airport security in a lot of very
    good ways. We want to move legitimate travelers or legitimate
    investment into the United States successfully while quickly
    stopping and identifying those threats before they can enter
    the United States and take root, as I noted with the Chinese.
        Right now, we are making everyone wait in that same,
    tragic, slow line. As a result, I call on Treasury and CFIUS
    several times to Congress to review and address the national
    security issue which we flagged, the Bitmain and Cango active
    in the digital asset space. This is iRobot and other robotics
    that are now flowing back to Beijing.
        The challenge here is not only could you have a Roomba that
    could map your entire area and report that back, but the very
    fact that the Chinese are using lawfare to be able to acquire
    sensitive proprietary information, whether it be corn seeds or
    robotics, and take that back to replicate inside Beijing. This
    is a concern that affects all of us.
        Mr. Pilkerton, I appreciate your leadership as Assistant
    Secretary for Investment Security at Treasury. I think Members
    of Congress want to make sure that we have got clear insight
    into the CFIUS review process, particularly where it is most
    appropriate.
        I want to ask some specific questions here, and I
    appreciate the conversation today. Is there a reason that we on
    the Financial Services Committee cannot get updates on our
    requests, specifically Treasury's response to my letter about
    Bitmain and the work that CFIUS said is a matter that we cannot
    share anything?
        Can we get into a SCIF? Can we understand what is going on?
    Can you help provide the clarity to this body so that we can
    better address legislative solutions with you?
        Mr. Pilkerton. Congressman, I certainly appreciate the
    question. I am not familiar with your letter, but happy to
    engage with our legislative team to come back and speak with
    your staff. You raise a couple of really important points that
    I would like to speak to, if I may.
        The first is the engagement of this committee is very
    important. As I stated before, the ability to be able to come
    to you and work with you to see if there are authorities or
    things that the program might need to be able to ensure that
    national security remains the number one and the abilities and
    processes are in place there is going to be incredibly
    important. I feel very strongly that we have that now.
        You made reference to the agricultural area. Earlier in
    2025, Secretary Bessent signed a memorandum of understanding
    (MOU) with Secretary Rollins to focus particularly in areas of
    ag land, biotech, transportation, storage and processing.
        So just for you and your constituents, I want you to know
    that is an area I have spoken to Secretary Rollins about
    personally, Deputy Secretary Vaden, and it is very high on our
    radar, and we are excited to have them as part of the committee
    for those transactions.
        Mr. Nunn. I am very encouraged to hear that feedback. I
    think that is a move in the right direction.
        When we look at--I think there are 330 transactions
    annually that your team reviews, that is no small
    accomplishment. At the same time, I want to make sure that
    there are prioritizations happening within there. I have to
    assess that CFIUS is doing some level of elevation for key
    things that are really critical to the United States.
        Can you speak to us on how that process is working now so
    we can go after these top-tier bad actors first versus looking
    at everything in a monolithic approach?
        Mr. Pilkerton. Sure. So from a process perspective, going
    back to your sort of airport analogy, we have the Known
    Investor Program that is under development. It is still under a
    pilot but the idea there is when we look at the people that are
    engaged in a transaction and the actual transaction itself, we
    have to assess both of those components for the national
    security risk.
        Our hope and goal are that under the Known Investor
    Program, we will be able to get a better understanding of the
    parties from as much information as we can get now that will
    continually be updated, as you would imagine, but that process
    will be as efficient as possible.
        Mr. Nunn. Thank you. I would like to make sure that we not
    only encourage this pilot program but those who want to invest
    do have a clean, safe pathway to do it, and those who are
    dangerous are priorities at the top. This is something we
    should be working on together.
        Thank you, Mr. Chair.
        Chairman Davidson. Thanks, Mr. Nunn.
        The gentleman from Texas, Mr. Green, is now recognized for
    5 minutes.
        Mr. Green. Thank you, Mr. Chairman.
        Mr. Chairman, Ranking Member, I have in my hand a bill
    styled the Preemption of Real Property Discrimination Act. This
    legislation would preempt States from producing unacceptable
    laws related to real property transactions as they relate to
    persons who may have a foreign background. I will say more
    about that at some other time.
        What is important to say is this: This legislation is
    legislation that would preempt the 50 States from each having
    their own laws related to individuals who are from other
    countries buying property.
        I am honored to tell you that Hon. Judy Chu is a co-lead on
    this legislation. It was introduced in a previous Congress, and
    today I plan to introduce it again.
        Fifty States, 50 different laws. CFIUS has the authority to
    deal with these transactions. Fifty States, 50 different laws.
        Will you kindly explain, sir, whether you think we should
    have 50 States with 50 different laws? Some may have a ceiling
    that is quite high. Others may have a floor.
        Your response, please.
        Mr. Pilkerton. Thank you, Congressman, for the question.
        In the CFIUS program that I have gotten the honor to lead
    focuses, obviously, on the Federal CFIUS laws. Now, in
    implementing that program, we work very closely with State
    actors to ensure we understand their concerns and are able to
    engage accordingly.
        Mr. Green. Let me ask you this, sir, if I may. I appreciate
    your interacting with them, but if it is only an interaction
    and they are allowed to do whatever they choose, we still have
    50 States with the ability to promulgate 50 different laws.
        Mr. Pilkerton. Thank you very much for that question. I
    just wanted to finish up saying that I not only will be
    engaging with the States but also with the chambers of commerce
    so they understand the Federal CFIUS program.
        With respect to the CFIUS program that I lead, I can only
    execute the laws on the Federal side. I have not seen your
    legislation but, obviously, I will focus on what I can do.
        Mr. Green. I will be proud to have you review it but 50
    States with 50 different laws is unacceptable. I think we need
    to preempt--CFIUS should have the authority to do this and if
    we need additional laws, other than what I will be introducing
    along with Hon. Judy Chu, I will be more than pleased to look
    at producing the laws to do this.
        This would undermine CFIUS to have these 50 States engaging
    in this process at will, but there is something more sinister
    that is taking place right now. It creates xenophobia when a
    State like Texas produces its law and you are relying on
    realtors to enforce the law. There is a certain amount of
    xenophobia that is taking place, and people are worried about
    their ability to engage in a legal transaction.
        I am going to give you a vignette that I have a personal
    relationship with. I buy property, and I was purchasing a piece
    of property and dealing with the typical methodology by which
    one makes the purchase. At the closing, the persons who were
    assisting us wanted me to sign a document indicating that the
    seller is not a foreign national. I do not know the seller's
    origin. I know nothing about the seller. As a matter of fact,
    never met the man. It was a man. Never met him.
        Somehow there was an expectation that I would sign a
    document saying that he was not a foreign national. That is the
    kind of confusion that these laws can create, because people
    are desiring to be law-abiding and make sure that they do that
    which is within the law.
        I am a very strong believer and advocate for equality,
    liberty, and justice for all, as we extol it in the Pledge of
    Allegiance. This behavior of allowing 50 different States to
    produce laws comparable to what we have in Texas is
    unacceptable. I think this bill is going to be very helpful.
        Finally, Mr. Chairman, thank you for giving me this second
    to say this. I support protecting our military installations,
    but I do not think we have to produce a law that will allow an
    American citizen to buy that land and prevent a foreign person.
    I want to protect us from anyone living near those sensitive
    sites. Does not matter to me where you are from. It is the
    sensitive site that judges, that I judge.
        Thank you very much, Mr. Chairman.
        Chairman Davidson. The gentleman's time has expired. All
    time for questions has expired.
        I would like to thank you, Mr. Assistant Secretary
    Pilkerton, for your testimony today.
        Without objection, all members will have 5 legislative days
    to submit additional written questions for the witness to the
    chairman. Questions will be forwarded to the witness for his
    response.
        Assistant Secretary Pilkerton, please respond no later than
    February 18 if we get those to you.

        [The information referred to can be found in the appendix.]

        This hearing stands adjourned.
        [Whereupon, at 11:48 a.m., the subcommittee was adjourned.]

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