Biden admin moves to investigate Elon Musk’s Twitter buy over foreign investors

According to the Washington Post, foreign investors could potentially have access to confidential information about Twitter’s finances and its users, under the terms of Musk’s acquisition of the social media platform.

However, the outlet acknowledged that it is unclear if Treasury officials were aware of the terms granting information rights to large investors and that “preliminary examinations often do not end in a full investigation.”

The Biden administration had previously floated the possibility of a national security review of the acquisition. Earlier this year, the FBI investigated the “potential counterintelligence risks posed by the deal,” according to the Post.

The outlet cited a “Saudi prince’s holding company and a subsidiary of the Qatari sovereign wealth fund,” a cryptocurrency exchange called Binance that was founded in China but has since moved its operations elsewhere, as investors of potential concern. The Post also noted Musk’s ties to China through his role as CEO of Tesla.

Reviews by the Committee on Foreign Investment in the United States (CFIUS) are typically used to investigate investments by foreign nationals and Musk is a US citizen. The group has reportedly not yet determined if Musk’s purchase of Twitter could trigger a national security review if they are even empowered to do so.

According to the outlet, CFIUS “would not necessarily scuttle Musk’s acquisition of Twitter… but the government could impose restrictions on what sorts of information rights are given to foreign parties or seek to limit powers they may have over the new company.”

The Washington Post admitted, “Treasury staff routinely examine whether purchases merit more in-depth investigations, often without proceeding to full-blown reviews.”

Senator Chris Murphy (D-CT) said that the federal government should investigate national security concerns connected to Saudi Arabian entities’ investments in Twitter. “We should be concerned that the Saudis, who have a clear interest in repressing political speech and impacting US politics, are now the second-largest owner of a major social media platform,” Murphy said.

According to the Post, “To trigger a review, the Saudi investment would have to have include special privileges — such as a board seat as an observer, or access to company information — beyond those given to an ordinary small investor in a public company. The terms of the deal as described to The Post would do that. But even then, a review would be unlikely to lead to the takeover being reversed.”