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UPenn pocketed $3m donation from mysterious Hong Kong shell company linked to Chinese government

The University of Pennsylvania is alleged to have received $3 million from a company owned by a businessman with links to the Chinese Communist Party.

The prestigious Ivy League school, which is based in Philadelphia claims that the cash came from a Chinese citizen named Xin Zhou who was a ‘large client’ of UPenn’s business school.

Zhou runs a company called E-House and participated in a University of Pennsylvania Wharton Business School event in Shanghai last year. 

However the Washington Free Beacon claims the money actually came from an alleged shell company, the Nice Famous Corp., which is connected to Shanghai real estate developer Xu Xeuqing.

Xeuqing, who has no connection to the university whatsoever is in turn, alleged to have links with the CCP.

Spokesman for the university, Stephen McCarthy has not explained why the university has decided to attribute the donation to Zhou. 

However, Beacon states claims the funds ended up flowing through the Hong Kong-registered Nice Famous Corporation Limited company, which Xu reportedly owns but despite there being no obvious connection between Xu and Nice Limited. 

The Nice Famous Corporation Limited appears to belong to another business, which is owned by Xeuqing, according to the Free Beacon. 

Xu is said to have faced corruption allegations in 2011 after allegedly bribing a Shanghai official with a Cartier watch. 

The official who received the item ended up being sentenced to life in prison yet Xu was not charged with a crime and was never prosecuted. 

Michael Sobolik who is a China expert at the American Foreign Policy Council, a non-profit group and not a government entity, told the Free Beacon that Xu’s non-prosecution could indicate close ties to the Chinese Communist Party.

‘The fact that Xu escaped prosecution in Tao Xiaoxing’s trial, and especially his survival of President Xi Jinping’s ‘anti-corruption campaign,’ suggests that Xu may have Party connections,’ Sobolik opined.  

‘Businessmen with high-level CCP connections can play by a different set of rules, as long as they are connected to the right Party faction,’ he said. 

But it is not the only donation that the university received from China in recent years as the country has tried, in part, to buy influence on American campuses.

UPenn has received $61 million ‘in gifts and contracts’ from Chinese donors between March 2017 and December 2019, according to the Free Beacon. 

In the four years prior, from 2013, the university received $19 million from Chinese donors. 

There are no allegations that UPenn received the money improperly. 

‘It is difficult to determine whether Chinese businesses are ‘truly independent of the government,’ Ben Freeman, director of the Foreign Influence Transparency Initiative at the Center for International Policy said to the Beacon. 

‘Even some of the contributions that we’re seeing ostensibly coming from Chinese businesses or Chinese charitable institutions, to some degree or another they are still connected to the Chinese government.

‘Unequivocally they’re using the money they’re providing the universities to garner influence there. It’s not the sole motive, but it’s one of a variety of motives.’  

Recently the Trump administration has sought to take action against Chinese influence at US universities, including the barring of graduate students with links to the Chinese military from studying in the US. 

The State Department has said that China uses such students to steal technical information.  

Relations between China and the U.S. appear to be at a low point with frequent clashes between the two countries.

Earlier this year, President Trump accused the Chinese of deceiving the west over early data on the coronavirus before it spread.

Last week Trump said he will ban the popular TikTok in the U.S. – a Chinese-owned social media network.

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