Rep. Jim Banks introduces bill to increase American universities' transparency regarding foreign gifts

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FIRST ON FOX: Rep. Jim Banks, R-Ind., introduced a bill Friday that would force American universities to be more transparent about foreign gifts and contracts.

The Education Department in 2019 and 2020 began cracking down on schools’ acceptance of foreign gifts under Section 117 of the Higher Education Act in an effort to track the scope of money from countries like China and Qatar in the U.S. education system.

That changed when President Biden took office. U.S. schools reported $1.6 billion in foreign gifts between July 1, 2020, and Jan. 20, 2021. Between Jan. 20, 2021 and November 2021, however, schools reported just $4.3 million in gifts over a longer time period, prompting questions from lawmakers about reporting requirements.

Representative Jim Banks, a Republican from Indiana, listens during a news conference in Washington, D.C., on Tuesday, July 27, 2021. (Al Drago/Bloomberg)

"Democrats are trying to trick Americans into another decade of cozy relations with the [Chinese] Communist Party. Their fake China bill does nothing to stand up to China. It’s legislative fraud," Banks told Fox News Digital in a statement, referencing Democrats’ China competitiveness bill, the America COMPETES Act, which includes a number of Democratic provisions that critics say do not belong in such a piece of legislation and could lead to abuse by Chinese nationals.

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"Speaker Pelosi’s CONCEDES Act uses a classic sleight of hand to avoid standing up to China. It proposes a ‘review’ of gifts from Chinese nationals, but if they are illicit, it doesn’t actually do anything to stop them," the Indiana Republican continued. "My bill provides a simple solution to hostile foreign influence at universities. Unlike Democrat’s bill, my bill recognizes that American citizens can act on behalf of hostile foreign governments too and reviews and then blocks all gifts from bad actors."

Banks' bill, called the Safeguard Our Universities From Foreign Influence Act, would reduce the reporting threshold for disclosure of foreign gifts and contracts from $250,000 to $50,000. It also requires the Department of Education to post comprehensive disclosure-related documents online for the public to review, subjects gifts related to critical technology to increased scrutiny and defines donors who generate substantial revenue or income from a foreign source as "foreign sources."

Representative Jim Banks, a Republican from Indiana, right, speaks during a news conference following an all member House briefing on Afghanistan at the U.S. Capitol in Washington, D.C., U.S., on Tuesday, Aug. 24, 2021. Photographer: Stefani Reynolds/Bloomberg

Additionally, the legislation establishes an office at the Department of Education to review foreign gifts and contacts with the Committee on Foreign Investment in the United States (CFIUS) and allows that office to block and undo foreign gifts and contracts deemed to compromise U.S. competitiveness or national security.

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Former President Trump proposed a change to Section 117 that could expand foreign gift reporting requirements during his first year in office. President Biden withdrew those changes and has not initiated his own modifications to Section 117 since taking office. 

The nonprofit Defense of Freedom Institute for Policy Studies, Inc., previously told Fox News Digital that it noticed a spike in reported foreign gifts to the University of Pennsylvania after the establishment of the Biden Center for Diplomacy and Global Engagement in 2017. DFI claims that the university received $21 million in reported foreign gifts between February 2017 and September 2020. 

University campus with few students during Fall 2020, University of Pennsylvania, in Philadelphia. (Jumping Rocks/Education Images/Universal Images Group via Getty Images)

DFI wrote in a FOIA request that after the Biden Center officially opened in 2018, the next year "UPenn received an astonishing 389% higher reportable foreign contributions 2019 compared to 2018."

In addition, a 2020 investigation by the Philadelphia Inquirer found that Penn received a staggering $258 million in foreign gifts since 2013, mostly from Chinese sources. University spokesperson Stephen MacCarthy told The Daily Pennsylvanian last year that the "Penn Biden Center has never solicited or received any gifts from any Chinese or other foreign entity."

Some lawmakers and political watchdogs have taken issue with hefty donations from China to U.S. educational entities, arguing that the donations could make U.S. education a target for Chinese propaganda.

In a Jan. 31 speech on threats posed by Chinese influence in the U.S., FBI Director Christopher Wray warned that the Chinese Communist Party was exerting influence on U.S. students and Chinese students studying in America from abroad.

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"In a recent incident at one Midwestern university, for example, a Chinese-American student posted online praise for those students who were killed in the Tiananmen Square massacre in 1989," Wray remarked. "And almost immediately, his parents called from China, saying that Chinese intelligence officers had shown up to threaten them because of his post.

Rep. Mike Gallagher, R-Wis., pressed Education Secretary Michael Cardona on the issue last year. 

The Education Department did not respond to his questions at the time, but said "records of foreign gifts and contracts reported to the Department by institutions are available in a searchable format here: https://sites.ed.gov/foreigngifts."

Fox News' Adam Shaw and Timothy H.J. Nerozzi contributed to this report.