New Hunter Biden revelations raise counterintelligence questions

Patrick Ho hardly seemed the profile of a big-time international fixer. A short, pudgy man, affectionately known to friends as “Fat Ping,” Ho had been a Harvard-trained ophthalmologist and a Hong Kong government minister. Yet in the fall of 2017, after landing at John F. Kennedy Airport in New York City, he was arrested by FBI agents and charged in an audacious plot to dole out millions of dollars in bribes to African leaders in exchange for major energy contracts that appeared to advance Chinese government interests.

What emerged in his indictment and later trial and conviction in federal court was a revealing portrait of Chinese influence peddling that included allegations that Ho arranged to broker arms deals — including the sale of rocket and grenade launchers — to countries in war zones in Africa and the Middle East.

There was one noteworthy detail, however, about Ho’s global wheeling and dealing that went unmentioned in federal court documents or Justice Department press releases at the time.During the same period that he was being pursued by the FBI for his role in the global bribery scheme, Ho and his boss, Ye Jianming, a billionaire oil tycoon with past ties to a front for the People’s Liberation Army, had entered into a business relationship with two members of the Biden family — President Biden’s son Hunter Biden and the president’s brother, James Biden.

As Yahoo News first reported, when Ho was arrested by agents at JFK, the first call he made was to James Biden. (The president’s brother later told the New York Times that he believed the call was intended for his nephew Hunter.) At the time, Ho’s connection to the Bidens was unclear. But emails on a damaged laptop that Hunter Biden left at a computer repair store in Wilmington, Del. — many of which have since been authenticated by the Washington Post and the Times — as well as bank records and other documents uncovered by Senate Republican investigators, reveal a high-dollar money trail that flowed from Chinese interests to Hunter and James Biden and which now appears to be at the heart of an ongoing Justice Department criminal investigation. (George Mesires, a lawyer for both Hunter and James Biden, did not respond to requests for comment from Yahoo News. A lawyer for Ho declined to comment.)

The documents show that over a 14-month period in 2017 and 2018, a Chinese firm, CEFC China Energy, which was founded by Ye and whose nonprofit wing was run by Ho, paid $4.8 million to an investment vehicle controlled by Hunter Biden. During that same time frame, Hunter Biden’s firm transferred $1.4 million to James Biden’s consulting firm, according to bank records and a report released by Sen. Charles Grassley, R-Iowa, ranking minority member on the Senate Judiciary Committee.

Moreover, in September 2017, just two months before the Chinese businessman’s arrest, Hunter Biden (who is a lawyer) signed a retainer agreement to represent Ho, according to emails found on his laptop and since authenticated by the Washington Post. Grassley separately obtained bank records showing $1 million was paid to Biden in March 2018 for the representation, although it is not clear what work, if any, he did for Ho. Court records of Ho’s criminal case show no indication that Biden or his law firm at the time, Boies Schiller Flexner, participated in Ho’s legal defense. (Among the questions that Yahoo News submitted to Mesires, the Bidens’ lawyer, were what work Hunter Biden did for the $1 million retainer and what work James Biden did for the $1.4 million paid to his consulting firm. He did not respond.)

But there are indications that Hunter Biden had good reason to suspect the Chinese intelligence connections of Ho and Ye. In a May 11, 2018, audio recording of a conversation with an unidentified woman found on the laptop, a copy of which has been obtained by Yahoo News, Hunter Biden complained about getting a phone call from a New York Times reporter asking about his representation of Ho. He is “literally the f***ing spy chief of China,” Biden says to the woman, clearly overstating Ho’s role. (It is unclear why the conversation, which was recorded by the woman, was on the laptop.)

In the same conversation, Biden also talked about phone calls he had gotten from his father about media inquiries into his business affairs. And he complains that Ye, who he refers to as “my partner” and “the richest man in the world” had recently gone missing in China and he was unable to get in touch with him. (Ye, who apparently ran afoul of Chinese President Xi Jinping, has not been publicly seen or heard from since.)

None of the details about Hunter and James Biden’s business dealings with Chinese interests implicate President Biden in any wrongdoing. But the depth and breadth of the Bidens’ financial ties with Ho and Ye raise new questions as to whether they were targets of a Chinese influence operation that, separate and apart from an ongoing criminal probe into Hunter Biden for alleged tax fraud and potentially foreign lobbying violations, represents a counterintelligence threat.

“There’s no question that Chinese intelligence services look for every possible opportunity to get close to family members of high-ranking officials,” said Frank Figliuzzi, former chief of the FBI’s counterintelligence division. In the past, Figliuzzi had expressed skepticism about stories in conservative media about Hunter Biden. But now, he adds, “I believe that the information we’ve learned is something that merits a review by the counterintelligence arm of the FBI.” (A FBI spokeswoman said the bureau would have no comment on whether it has initiated a counterintelligence inquiry into the Bidens’ Chinese connections similar to the one it launched into then candidate Donald Trump and his campaign in the summer of 2016.)

There’s “no doubt Hunter presents CI [counterintelligence] vulnerabilities,” says another former senior FBI official, who asked not to be identified by name discussing sensitive matters relating to the Bidens. But those issues received less scrutiny during the Trump years because Trump and his own family had multiple business interests with foreign governments, which he used his power as president to bolster.

“Trump and all the hangers-on were so bad that I think some legitimate questions about Hunter have been covered less rigorously than they should have been,” said the former official. Still, if Trump’s children such as Donald Trump Jr. or Eric Trump were doing the same things, “many more people would be howling.”

Alleged Chinese political influence schemes in the U.S. go back decades. In the 1990s, a campaign finance scandal known as “Chinagate” erupted over illicit donations by Chinese backers with ties to the country’s intelligence service to the Democratic National Committee and Bill Clinton’s 1996 reelection campaign.

More recently, suspected Chinese agents have tried to sidle up to prominent politicians including California Democrats Sen.Dianne Feinstein and Rep. Eric Swalwell, prompting the FBI to give both lawmakers a “defensive briefing.” (After being alerted by the bureau, Feinstein fired the staffer alleged to be working for Chinese intelligence. Swalwell cut his ties to the suspected Chinese agent who had been raising money for his campaign.) Scions of prominent Republican families, like Neil Bush — son of former President George H.W. Bush and the brother of former President George W. Bush — have also been criticized for their connections to Chinese organizations running influence efforts.

But a full picture of the Chinese business ties of the Bidens has only emerged in fits and starts, with much that is still unknown. Although many of the details have circulated in conservative media circles for some time, they were largely ignored by mainstream news organizations in part because they initially surfaced on a laptop that wound up, through circuitous means, in the hands of Rudy Giuliani, Trump’s lawyer who is prone to making factually dubious claims, and the accuracy of its contents was hard to verify.

Playing on those concerns and the memory of the Russian hack-and-dump campaign that targeted 2016 Democratic presidential nominee Hillary Clinton, 51 former U.S. intelligence officials (many of whom had clashed with Trump and were publicly backing Biden) released a statement claiming that the email dump “has all the classic earmarks of a Russian influence operation.” The intel officials who signed the letter acknowledged they had no evidence of Russian involvement in the laptop, and none has surfaced since then.

Still, signs of Hunter Biden’s efforts to do business in China — and his willingness to use his proximity to his father to further those deals — had been public for some time. In 2013, Hunter Biden accompanied his father, then the sitting vice president, aboard Air Force 2 on a trip to Beijing. While his father engaged in five-and-a-half hours of talks with Xi, the Chinese leader, the younger Biden met with Jonathan Li, a Chinese banker with whom he had just formed a Chinese private equity firm. (The Chinese business license for the firm was issued by Shanghai authorities 10 days after the trip and Hunter Biden was named a member of the board, according to NBC reporter Jonathan Lederman, then with the Associated Press, who accompanied the Bidens on the trip.)

What became of that venture — and how much it netted Hunter Biden — is still fuzzy. But by 2017, as his father was starting to plot his campaign for president, Hunter Biden began forming new ventures with problematic new partners. He met with Ye, the chief of CEFC, for dinner in Miami and discussed a $40 million investment in a liquified natural gas venture in Louisiana, according to an account in the New Yorker. That summer, Ye also informed Hunter Biden that his deputy, Ho, was under criminal investigation by federal prosecutors in New York and asked the younger Biden to assist in his defense — a request that led to the $1 million retainer payment the following year.

As those relationships solidified, the FBI was intensifying its pursuit of Ho. Court documents later revealed that the bureau had gotten a Foreign Intelligence Surveillance Act warrant to secretly intercept Ho’s communications, an action the FBI can only be granted for targets suspected of being an agent of a foreign power or a terrorist organization.

The case that prosecutors ultimately brought against Ho revolved around claims that he used CEFC’s U.S.-based nonprofit, the China Energy Fund Committee, to shell out $2.5 million in bribes to senior African officials to win oil contracts for Ye’s Shanghai-based energy conglomerate.

Ho was not formally accused of acting on behalf of the Chinese government. But when it comes to Beijing’s influence operations, the line between freelancing businessmen and de facto agents of the state can be thin, sometimes by design, according to former U.S. intelligence officials. Indeed, Ho’s own defense lawyersargued that his actions were “in furtherance of the Chinese state’s agenda” by promoting Belt and Road, Xi’s signature initiative to expand Chinese economic power around the world through infrastructure investment.

Besides his bribes, prosecutors also introduced evidence of other misdeeds by Ho. He had, they charged, sought to facilitate a sanctions-busting scheme on behalf of Iran, plotting with an Iranian agent how to wash frozen Iranian funds so Tehran could covertly purchase precious metals. He also sought to “leverage his connections and power” by brokering arms deals — including the sale of mortar rounds and rocket, anti-tank and grenade launchers — to Libya, Chad, South Sudan and Qatar, according to a sentencing memo filed by the prosecutors.

Ho’s “actions were corrupt and they were criminal, and he knew it,” said Douglas Zolkind, an assistant U.S. attorney during the former Hong Kong minister’s trial at federal court in Manhattan. “That’s why he carried out these schemes from his perch as the head of a nonprofit NGO, where he could gain access to world leaders under the guise of someone interested in humanitarian goals.”

Ho was convicted of seven counts for money laundering, conspiracy and foreign lobbying violations in December 2018 and sentenced to three years in federal prison.