Partnerships / Acquisitions

Panic Arises As Chinese Company Plans To Acquire U.S. MoneyGram

Foreign interference with U.S. organizations or the government is always a concern. Following the 2016 presidential election, this concern has likely only increased its level. As such, when Ant Financial, which is owned in part by the Chinese government, announced its plans in January to acquire U.S.-based money-transfer company MoneyGram for $880 million, significant worries arose.

Specifically, the concerns are around the exposure of millions of Americans’ personal data, including government employees and military.

Several U.S. lawmakers and national security experts have voiced concerns that the Committee on Foreign Investment is ill-equipped to fully assess this acquisition process to fully determine all security weaknesses of the deal.

North Carolina Representative Robert Pittenger voiced his thoughts on the businesses deal: “If the transaction is approved, China would gain direct access to a significant amount of transactional data in MoneyGram’s network. The data would include names, bank account numbers, as well as the location of MoneyGram customers.”

With several MoneyGrams close to U.S. military bases and locations in approximately 200 countries, the U.S. fears this business deal would make the country more prone to foreign espionage and cyberattacks. Many U.S. officials are calling for a more rigorous review process of the deal.

While Ant Financial spokesman, Reze Wong, tried to calm these concerns, the U.S. is still approaching the situation with caution. “They (the Chinese government) are non-controlling stakes, don’t participate in management and don’t have access to things like consumer data,” Wong said.

MoneyGram also shared a statement with POLITICO Magazine to help ensure any concerns were addressed: “We [will] continue to operate as a stand-alone company, and customer information will continue to be encrypted and stored on our IT systems in Minneapolis in accordance with all applicable data protection requirements.”

It’s likely this deal will take several more months of investigations and probing before it moves forward.

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