Ernst Calls to Ban Funding for American Consulting Firm Working for CCP

WASHINGTON – U.S. Senator Joni Ernst (R-Iowa) joined Chairman John Moolenaar (R-Mich.) of the House Select Committee on the Chinese Communist Party and U.S. Senator Marco Rubio (R-Fla.) in exposing new evidence of an American consulting firm working for the Chinese military and Chinese Communist Party and calling on Attorney General Merrick Garland and Defense Secretary Lloyd Austin to initiate a criminal investigation and debar McKinsey & Company from receiving Department of Defense (DoD) contracts.

The lawmakers reveal how McKinsey failed to disclose consulting work for the Chinese government and lied about working for the Chinese government under oath, all while receiving over $480 million to consult for the U.S. military since 2008. In their letter, the lawmakers outline the details of McKinsey’s work to advance the Chinese Communist Party and Chinese military, its work to shape the Chinese Communist Party’s five-year plans to surpass the United States, and its failure to report its China work, as required by U.S. law.

McKinsey’s work on sensitive U.S. national security matters occurred as the company failed to disclose its similar work for China – while it is seeking to capably threaten the U.S. military and American troops. The risk that McKinsey leveraged sensitive American programs and secrets to benefit the Chinese state is grave and merits an investigation and future consequences.

“It is deeply disturbing that McKinsey, which has a history of undermining the interests of the U.S. government in favor of another client, engaged in sensitive government contracts with DoD while failing to disclose its work with the PRC [People’s Republic of China] government and its state-owned enterprises on issues of national importance,” the lawmakers wrote.

“McKinsey not only failed to make necessary disclosures but actively concealed its sensitive work for the PRC government in sworn testimony before Congress. In describing McKinsey’s Chinese contracts, McKinsey’s Global Managing Partner testified under oath before Congress this year that the company never worked for the central government of the PRC,” they continued.

The lawmakers also highlighted the massive discrepancies in McKinsey’s Managing Partner’s testimony before Congress in February 2024. They concluded by requiring a briefing from both Attorney General Garland and Defense Secretary Austin by Dec. 1 about McKinsey's criminal implications and its status as a DoD contractor.

Background:

Ernst has led the bipartisan CONSULT Act to prohibit DoD from contracting with consulting firms like McKinsey for national security matters when those firms also provide consulting services for sanctioned entities or foreign adversaries, like China, Russia, or Iran.

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