US investigating Harvard, Yale over alleged China, Saudi Arabia secret funding

By Kate O'Keeffe

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The Education Department opened investigations into Harvard and Yale as part of a continuing review that has found U.S. universities failed to report at least $6.5 billion in foreign funding from countries such as China and Saudi Arabia, according to department materials viewed by The Wall Street Journal.

The investigations into the Ivy League schools are the latest in a clash between U.S. universities and a coalition of federal officials including law enforcement, research funders such as the National Institutes of Health and Defense and Energy Departments, and a bipartisan group in Congress that has raised concerns about the reliance of higher-education institutions on foreign money, particularly from China.

A Harvard spokesman said the university is working on a response. A Yale spokeswoman didn't immediately have a comment.

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The Education Department described higher-education institutions in the U.S., in a document viewed by the Journal, as "multi-billion dollar, multi-national enterprises using opaque foundations, foreign campuses, and other sophisticated legal structures to generate revenue."

Officials accused schools of actively soliciting money from foreign governments, companies and nationals known to be hostile to the U.S. and potentially in search of opportunities to steal research and "spread propaganda benefitting foreign governments," according to the document.

In addition, while the department said it has found foreign money generally flows to the country's richest universities, "such money apparently does not reduce or otherwise offset American students' tuition costs," the document said.

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U.S. officials say China uses a variety of means to target academia, including government-funded talent recruitment programs such as the Thousand Talents Plan. The arrest last month of the chairman of Harvard's chemistry department on federal charges of lying about receiving millions of dollars in Chinese funding through the program while the U.S. shelled out more than $15 million to fund his research group catapulted the issue into the spotlight.

In a letter to Harvard dated Feb. 11 and posted on the Education Department website, officials cited the recent Justice Department case and asked the school to disclose records of gifts or contracts involving the governments of China, Qatar, Russia, Saudi Arabia and Iran. It also requested records regarding telecommunications giants Huawei Technologies Co. and ZTE Corp. of China; the Kaspersky Lab and Skolkovo Foundation of Russia; and the Alavi Foundation of Iran, among others.

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The Education Department said Yale had failed to disclose at least $375 million dollars in foreign funding after filing no reports from 2014-17, according to a document viewed by the Journal. The department, in a Feb. 11 letter to the university, sought records regarding contributions from Saudi Arabia, China and its telecom giants, Peking University's Yenching Academy, the National University of Singapore, Qatar and others. It also asked the university to detail foreign funding of Yale Law School's Paul Tsai China Center and the new Yale Jackson School of Global Affairs.

If the schools refuse to disclose the information, the Education Department can refer the matter to the Justice Department, which could pursue civil or criminal actions.