States and federal governments are increasingly concerned over real estate purchases made by foreign nationals from adversarial countries.
By Darlene McCormick Sanchez | Epoch Times
The windswept town of Cheyenne, Wyoming, known for its cowboy culture, doesn’t seem like the kind of place anyone would need to worry about geopolitical espionage.
Yet, the Biden administration was concerned enough in May to make a rare move and issue an executive order shutting down MineOne Partners Ltd. and its affiliates. The firms are majority-owned by Chinese nationals.
The 12-acre site, purchased in 2022, is a mile away from Warren Air Force Base, home to the U.S. Minuteman III nuclear-armed intercontinental ballistic missiles.
If not for a public tip, the federal government would not have known about the crypto mine site, which uses computers to mine Bitcoins.
Land purchased or owned by people and entities with ties to China and located near military facilities or infrastructure is being scrutinized more closely as tensions between Washington and Beijing rise.
Chinese investors made 97 land transactions between 2020 and 2022, the most of all foreign nationals. The data did not specifically list real estate deals, according to a 2022 report from the Committee on Foreign Investments in the United States (CFIUS). CFIUS is responsible for tracking and investigating foreign nationals’ real estate and business purchases.
States with the largest Chinese holdings are Texas, 159,640 acres; North Carolina, 44,776 acres; Missouri, 43,071 acres; Utah, 32,447 acres; and Virginia, 14,382 acres, according to the USDA in its most recent report.
Most of the land is held by a handful of Chinese investors.
However, so far, federal legislation to limit Chinese nationals or entities from purchasing land has gone nowhere.
And presidential prohibitions of foreign acquisitions like the one President Joe Biden issued against MineOne are rare.
Only eight such orders have been made since the administration of President Gerald Ford in 1975, according to the Center for Strategic and International Studies.
In January, the Government Accountability Office (GAO) reported key weaknesses in identifying land purchases that could threaten national security, including the lack of coordination between government agencies and the use of paper forms instead of online forms at the U.S. Department of Agriculture (USDA) to collect data on foreign land purchase.
The GAO said the USDA should also share land purchase data with the CFIUS in a timely manner instead of annually.
At a June 26 hearing, lawmakers on the Committee on Oversight and Accountability discussed Beijing’s efforts to undermine the United States on multiple fronts.
Rep. Pat Fallon (R-Texas), who sits on the committee, said during the hearing that China is far more dangerous than the Soviet Union ever was.
Mr. Fallon, who also serves on the Armed Services Committee, said that the Chinese Communist Party (CCP) is testing the resolve of the United States.
The entrance of Warren Air Force base near Cheyenne, Wy., in this file photo. A 12-acre site puchased by Chinese nationals in 2022, is a mile away from the U.S. air force base. (Michael Smith/Getty Images)
He called the CCP “dangerous, wealthy, and very well-armed bullies.”
“It will be a dark day for humanity if the Chinese Communist Party ever reaches their goal of world hegemony,” he said.
Later, Mr. Fallon told The Epoch Times that land purchases near military installations are a “grave threat” to national security.
“I’m choosing my words carefully. I don’t want to understate the threat because you can’t overstate it,” he said.
China’s track record makes such land purchases suspect, he said.
President Biden’s executive order to shut down the Wyoming crypto mine was the right thing to do, Mr. Fallon said.
In 2022, President Biden issued a separate executive order that expanded the scope of CFIUS to include foreign purchases that impact such areas as the U.S. supply chains and artificial intelligence.
Purchasing land in rural areas potentially gives the Chinese eavesdropping ability by tapping into fiber optics, cables, and other communications pathways that crisscross America, said Chuck DeVore, chief national initiatives officer at the Texas Public Policy Foundation. Mr. DeVore served in the Pentagon during the Reagan administration as a special assistant for foreign affairs.
Chinese telecommunications firms began providing cell phone towers in rural areas near military bases at cost several years ago, he said, which raised suspicions as to why the companies would operate without making a profit.
That leaves open the possibility for eavesdropping and jamming communications, Mr. DeVore said.
The federal government’s Cybersecurity and Infrastructure Security Agency issued an advisory in February that the Chinese-sponsored hacker group Volt Typhoon had “compromised the IT environments of multiple critical infrastructure organizations—primarily in communications, energy, transportation systems, and water and wastewater systems” throughout the country.
Hackers are “seeking to pre-position themselves on IT networks for disruptive or destructive cyberattacks against U.S. critical infrastructure in the event of a major crisis or conflict with the United States,” the government warned.
MineOne Partners did not immediately respond to a request for comment when contacted by The Epoch Times.
The purchase of U.S. land could potentially give the Chinese regime access to eavesdropping communications across America, according to Mr. DeVore. (Greg Baker/AFP via Getty Images)
China’s Long Game
Experts say the United States needs a holistic approach across government agencies to address threats to national security from the CCP.
Ret. Navy Capt. Jim Fanell, who testified at the June 26 hearing, said he considers the China threat severe enough to warrant moving CFIUS from the Treasury Department to the Defense Department.
“If we fail, America will surely fall under the boot of an expansionist, genocidal, and totalitarian Chinese Communist Party,” Mr. Fanell told lawmakers.
Erik Bethel, a global financial expert who has represented the United States at the World Bank, testified that the United States and the rest of the world need to pay attention to Chinese land purchases.
He noted China’s purchase of hundreds of thousands of acres in Latin America that could be used against the United States through military applications.
China has a military space station in Argentina that can track polar low Earth orbit satellites, enabling the CCP to track hypersonic weapons, he said.
In Panama, China owns container terminals on both sides of the canal, which is a vital passage for the U.S. supply chain.
“It’s not just in the United States,” he said. “We should be aware that China’s encircling us, and we need to kind of wake up and get out of the matrix,” Mr. Bethel said.
Buying in the Heartland
In total, there are 44 million acres of foreign-held U.S. agricultural land, according to the USDA report.
The annual report, which shows agricultural land that is foreign-owned or leased as of Dec. 31, 2022, is issued under the Agricultural Foreign Investment Disclosure Act of 1978 (AFIDA).
(Illustration by The Epoch Times, Shutterstock)
Canadian investors own the largest amount of reported foreign-held agricultural and non-agricultural land, with 32 percent, or 14.2 million acres, according to the report.
China was much further down the list, with some 347,000 acres, amounting to less than 1 percent of foreign-held acreage.
The Chinese company with the most land is Murphy Brown LLC and associated companies, which bought the pork-production company Smithfield Foods, and now owns 141,000 acres across several states, according to the report.
Likewise, Chinese billionaire Sun Guangxin, owner of Guanghui Energy, purchased land near Laughlin Air Force Base in South Texas through Brazos Highland Properties LP and Harvest Texas LLC for a combined total of 132,000 acres.
That made Mr. Sun the second largest Chinese landowner in the United States in 2022.
The Texas land deal is one of several high-profile cases in which the federal government hasn’t blocked land sales to Chinese businesses. CFIUS didn’t deem the transaction a national security threat and allowed it to go through.
The billionaire, who was an officer in the Chinese military, spent an estimated $110 million for the land between 2016–2018 to build a wind farm that would sit near the Texas base used to train military pilots.
At the time, a spokesman for one of Mr. Sun’s energy companies denied accusations of spying to a local publication.
In 2021, Texas lawmakers stepped in to ban Chinese companies from accessing the state’s power grid and other critical infrastructure, prompting the aspiring wind farm developer to sell his interest to Spanish company, Greenalia.
Another high-profile case involved the Fufeng Group, a Chinese business that produces bio-fermentation products such as sweeteners from corn.
In 2022, the group purchased 300 acres of farmland 12 miles from Grand Forks Air Force Base in North Dakota.
CFIUS reviewed the Fufeng purchase but eventually concluded that it lacked jurisdiction to stop the investment as the base was not listed as a sensitive facility, according to testimony before the Committee on Agriculture.
Airmen assigned to the 319th Aircraft Maintenance Squadron perform a maintenance check on a drone at the Grand Forks Air Force Base, N.D., on June 6, 2022. A Chinese business purchased 300 acres of farmland 12 miles from Grand Forks Air Force Base in North Dakota in 2022. (U.S. Air Force photo by Senior Airman Ashley Richards)
That left Grand Forks Mayor Brandon Bochenski and the city council to act after the U.S. Air Force voiced concerns.
In February of 2023, the city council voted against connecting industrial infrastructure to the Fufeng facility and denied building permits.
During a city video showing the vote, the audience applauded loudly and residents began chanting “USA.”
A Fufeng USA official publicly dismissed the idea that it could conduct surveillance on the nearby base, according to CNBC.
Afterward, the Treasury Department’s Office of Investment Security made a rule change in 2023 that expanded CFIUS’s powers to include two of the air bases at the center of past controversies—Laughlin in Texas and Grand Forks in North Dakota—along with six other military installations.
The other bases are: Air Force Plant 42, located in Palmdale, California; Luke Air Force Base, located in Glendale, Arizona; Ellsworth Air Force Base, located in Box Elder, South Dakota; Iowa National Guard Joint Force Headquarters, located in Des Moines, Iowa; and the Texas-based Dyess Air Force Base, located in Abilene and Lackland Air Force Base, located in San Antonio.
Fufeng Group USA did not immediately respond to a request for comment when contacted by The Epoch Times.
States Take a Stand
While federal lawmakers have failed to pass laws against land purchases by adversarial foreign nations or their agents, states have done just that.
Almost half the states have laws in some way restricting ownership or investments in private agricultural land, according to the National Agricultural Law Center.
This year, Indiana and Georgia passed laws barring foreign adversaries’ ownership of land near military facilities and banning the acquisition of agricultural land in their states.
A sign opposing a corn mill project in Grand Forks, N.D., on Dec. 25, 2023. Many residents oppose a corn mill investment by a Chinese company with suspected ties to the Chinese Communist Party. (Allan Stein/The Epoch Times)
South Dakota banned foreign governments—China, Cuba, Iran, North Korea, Russia, and Venezuela—and entities from those countries from owning state agricultural land.
Florida’s version of the law has been challenged in federal court.
A similar bill was blocked in Texas, though the Republican-led state legislature is expected to try to pass it again in 2025.
In 2023, the CCP conducted “information warfare” against the Texas bill banning land sales to adversarial nations and their agents, according to a military document obtained by The Epoch Times.
The CCP-controlled media platform WeChat was flooded with false information immediately after the session began, the document stated.
WeChat, owned by Tencent, was developed by the Chinese as a social media, messaging, and mobile payment app that has more than 1 billion users.
Michael Lucci is the founder and CEO of State Armor Action, a nonprofit group that helps states assess global security threats.
Mr. Lucci told The Epoch Times that his company found the same Fufeng Group that was blocked in North Dakota had attempted to buy land in other states, such as Indiana.
Fufeng was negotiating to build a grain processing plant 9.7 miles from a National Guard base, according to Indiana lawmakers.
Mr. Lucci said at the forefront of national security concerns is foreign land ownership near infrastructure such as power, electrical, and water plants.
He said the federal government sent a letter to governors on March 18 detailing cases in which Iran and China have attempted to sabotage water infrastructure in states.
“We’ve got to start protecting against this,” he said.
An Orange County Water District staff member walks through the Groundwater Replenishment System in Fountain Valley, Calif., on July 20, 2022. At the forefront of national security concerns is foreign land ownership near infrastructure such as power, electrical, and water plants, according to Mr. Lucci. (Mario Tama/Getty Images)
Mr. DeVore told The Epoch Times that Americans should remember the CCP’s objective to create a new world order.
About four years ago, people began to notice an increase in Chinese purchases of ranches, farmland, and food operations.
The most benign explanation for these purchases is food security for the Chinese people, which means security for the CCP, he said.
Mr. DeVore said other reasons could be intellectual property theft, espionage, and biological warfare.
Taking over food operations in the United States allows China to reverse engineer how the U.S. food production system works, giving them an advantage in building their systems, he said.
Chinese ownership of farmland would make it easier for bad actors to sabotage America’s food supply, Mr. DeVore said.
Devastating diseases could be released into the cattle, hog, and chicken populations and blight or mold could be introduced into the commercial food production system to destroy crops, he said.
