U.S. Lawmakers Question Webull's Ties to China Amid Security Concerns

The U.S. House Select Committee on the Chinese Communist Party raises concerns about Webull Financial LLC's links to China, highlighting security risks to American investors. Lawmakers demand documentation on Webull's operational independence and data privacy, setting a response deadline for the company.

Chairman John Moolenaar and Ranking Member Raja Krishnamoorthi of the U.S. House Select Committee on the Chinese Communist Party have expressed grave concerns regarding the ownership and operational affiliations of Webull Financial LLC with China. The lawmakers point out potential security threats to American investor data and the broader U.S. financial framework due to these Chinese connections.

The Committee's letter elaborates on Webull's planned public listing through a merger with the SPAC SK Growth Opportunities Corp., maintaining considerable connections with Chinese organizations. Notably, these links include parent company Fumi Technology and Hunan Weibu Information Technology Co. of Changsha, which receives backing from the CCP and shares resources with Webull. Lawmakers question Webull's adherence to U.S. regulations concerning market fairness and data security, despite its restructuring efforts.

This concern is intensified by China's laws compelling corporate compliance with state intelligence. The Committee also scrutinizes Webull's relocation to Florida and the deregistration of its China-based brokers, questioning the timing of these developments ahead of the impending SPAC deal. The lawmakers express unease about Webull's compliance with U.S. regulations, particularly the SEC's Rule 606 concerning order routing data, hinting at possible market manipulation or data reporting omissions.

The Committee demands extensive documentation from Webull, seeking clarity on its autonomy from Chinese state influence, data protection measures, and strategies to safeguard U.S. investors' assets. A response deadline is set for December 31, 2024. The Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party holds investigatory power to offer policy advice on the CCP's economic, technological, and security impacts on American interests. As of now, Webull has not issued a public response to the Committee's findings. (ANI)

(With inputs from agencies.)