WASHINGTON – Sen. John Kennedy (R-La.), a member of the Senate Banking Committee, published this op-ed in the Baton Rouge Business Report on December 11, 2020. 

Below are key excerpts from the piece, which examines the threat posed by foreign companies that are listed on U.S. stock markets but refuse to submit to the same auditing rules as other firms:

“Luckin Coffee, known as ‘China’s answer to Starbucks,’ has a casual relationship with the truth. In April, the company was forced to disclose that its chief operating officer, Jian Liu, inflated its 2019 sales by $310 million. The revelation caused Luckin Coffee’s shares to fall by 80%, and its value to drop from $12.7 billion to less than $800 million.

. . . 

“Luckin Coffee was finally delisted from the American NASDAQ stock exchange, but the damage was done. Americans who invested in the Chinese company had already suffered tremendous financial damage.

“The problem is that Luckin Coffee is just one of almost 200 Chinese companies listed in America not subject to inspection by the federal Public Company Accounting Oversight Board (PCAOB). These companies claim that Chinese secrecy laws prevent them from sharing ‘sensitive’ paperwork for auditing by the PCAOB.

. . .

“To combat this threat, Congress just unanimously passed a measure with two main provisions: First, the bill requires foreign companies to certify that they are not owned or controlled by a foreign government—like Communist China. The provision also requires companies to disclose any involvement by Chinese Communist Party (CCP) officials. Second, any foreign company that does not open its books for PCAOB auditing for three consecutive years will be banned from trading stocks on U.S. markets.  

“That’s key to how this bill, the Holding Foreign Companies Accountable (HFCA) Act, will protect investors at home. Many Louisianians and their fellow Americans rely on their stock portfolios for their retirement and education savings. It’s past time we safeguarded them from fraud by kicking bad actors off our markets.

. . .

“The HFCA Act passed without a single ‘nay’ vote because it will strengthen the credibility of U.S. stock markets, ensuring everyone plays by the same rules. As we recover from the economic challenges of a pandemic, the HFCA Act gives Louisiana investors peace of mind. 

. . .

“China’s deception has gone on for long enough. With bipartisan agreement already forged, the HFCA Act is now on the president’s desk, where he can sign it into law before more good people get hurt. Americans deserve accountability from foreign companies, and it’s finally within reach.”

The full op-ed is available here.

WASHINGTON – Sen. John Kennedy (R-La) gave a speech honoring Diane Deaton, a weather forecaster in Baton Rouge, who announced she will retire after 37 years on the job.

Ms. Deaton has worked for WAFB-TV, serving on both 9News This Morning and on Early Edition. She is also widely known for her humanitarian work in Baton Rouge, having built homes for Habitat for Humanity, tutored first and second-graders, and visited young patients at Our Lady of the Lake Children’s Hospital.

“I’m glad to hear that Diane will not be leaving our great state—I want to emphasize that—she is going to retire in Louisiana. And I hope she enjoys every moment, every single moment, she gets to sleep in after December 18. No one can argue, no fair-minded person can argue, that she hasn’t earned a rest, even though her familiar weather casts will be sorely missed in a state that takes more than our fair share of beatings from Mother Nature,” said Kennedy.

“I thank you for the chance to honor Diane Deaton for all of her hard work on behalf of everyone who relies on WAFB-TV for news, and for everyone in Louisiana and Baton Rouge whom her volunteer work has touched—and that numbers in the hundreds of thousands. Diane, may the years ahead bring as much joy to you as you have brought to our state and our community. God bless you,” concluded Kennedy.

Video of the speech is available here.

WASHINGTON – Sen. John Kennedy (R-La.) today introduced legislation to protect jobs and drilling opportunities in the Gulf of Mexico and the conservation efforts they fund. Sens. Cindy Hyde-Smith (R-Miss.), Bill Cassidy (R-La.), Ted Cruz (R-Texas), John Cornyn (R-Texas) and Roger Wicker (R-Miss.) are original cosponsors of the Conservation Funding Protection Act.

The Conservation Funding Protection Act would ensure that American oil producers would retain access to critical energy reservoirs on the Outer Continental Shelf. That energy production funds conservation, coastal restoration, hurricane preparedness, wetland mitigation and public land maintenance.

“Louisianians and other energy producers help keep America running and keep America safe. If Americans aren’t allowed to use U.S. resources to fuel our economy, we’ll be dependent on nations that don’t share our values and that even oppose our interests. We can’t afford to lose the energy independence our country has earned, the Louisiana jobs that make it possible or the coastland conservation that it funds,” said Kennedy.

“The Conservation Funding Protection Act is important to help ensure Mississippians continue to have access to well-paying jobs, while also continuing to provide the state with oil and natural gas revenues for vital conservation projects in Mississippi and on a national level,” Hyde-Smith said.

“Many Louisiana families depend on energy production and the jobs it produces. This bill keeps the Gulf open for business and ensures these workers won’t be threatened by radical environmental agendas,” said Cassidy.

“The preservation of energy production in the Gulf of Mexico is vital to the economic and national security of the United States. Not only does offshore drilling employ thousands of Americans and help fuel our economy and energy needs, but it contributes millions of dollars to environmental conservation projects on land and reduces our reliance on foreign powers. I am proud to support this legislation to ensure that that United States remains a global leader in energy production for years to come,” said Cruz.

“Ensuring continued access to energy resources in the Gulf of Mexico is critical to funding conservation efforts and important storm mitigation projects along the Texas coast. This bill would help keep us from a return to the days of relying on our adversaries to meet our energy needs,” said Cornyn. 

“The Gulf of Mexico’s bountiful natural resources have been a cornerstone in the resurgence of American energy independence. Revenues generated from federal leases have also supported a multitude of critical conservation and restoration projects along the Mississippi Gulf Coast. The Conservation Funding Protection Act would guarantee our valuable resources are managed responsibly and that states can continue to invest in projects that will sustain their coastlines for generations to come,” said Wicker.

In order to ensure that the Gulf region can steward the shelf’s resources, the Conservation Funding Protection Act would require at least two area-wide lease sales per year on available acreage in the Western and Central Gulf of Mexico. The Outer Continental Shelf Lands Act currently directs the Secretary of Interior to establish a schedule for lease sales on the Outer Continental Shelf but does not mandate the number of lease sales the department is required to hold.

This bill would maintain all current environmental laws and ensure that the Department of Interior conducts the environmental reviews required by law within clear time frames. The legislation does not alter environmental regulations for lease sales, rig operations or exploration.

Background:

With the recent extension of a drilling moratorium off Florida waters lasting until 2032, there is growing concern that access to leasing opportunities on the Outer Continental Shelf could evaporate, at great cost to American jobs and energy independence.

Some projections estimate that a permitting ban on natural gas and oil leasing and development projects on federal lands and waters—such as the Outer Continental Shelf—would result in the loss of nearly 1 million oil and gas related jobs within the first 12 to 24 months of the ban. Louisiana is home to 48,000 of those jobs. Such a ban would decrease offshore oil production by 44 percent and natural gas production by 68 percent within the next decade.

Support for this legislation includes the Louisiana Mid-Continent Oil and Gas Association, American Petroleum Institute, National Ocean Industries Association, International Association of Drilling Contractors, Consumer Energy Alliance, International Association for Geophysical Chemistry, Petroleum Equipment and Service Association and others.

“We applaud Senators Kennedy and Hyde-Smith for introducing this bill that will protect so many benefits for the Gulf region. The Conservation Funding Protection Act is critical to protecting existing energy production in the Gulf of Mexico and the livelihoods of thousands of hardworking citizens across the Gulf coast. Oil and gas leasing and production in the Gulf of Mexico is also the primary source of funding for conservation projects across the country, and, importantly, for Louisiana's hurricane protection systems and coastal restoration efforts,” said Tyler Gray, Louisiana Mid-Continent Oil and Gas Association President.

“The Conservation Funding Protection Act is critical for maintaining energy development in the Gulf of Mexico, the primary revenue driver for America’s largest federal conservation program. Royalties from offshore oil and natural gas development fund most of the Land and Water Conservation Fund, supporting and protecting national parks and wildlife habitat. Continued support for oil and natural gas production on federal lands and waters is imperative for maintaining these vital conservation programs,” said Lem Smith, American Petroleum Institute Vice President of Upstream Policy.

The bill text is available here.

WASHINGTON – The House of Representatives today passed Sens. John Kennedy (R-La.) and Chris Van Hollen’s (D-Md.) bill to protect American investors and their savings from foreign companies that operate on U.S. stock exchanges while refusing to submit to Securities and Exchange Commission (SEC) oversight. The Senate passed the bill unanimously in May.

“Communist China is right now using U.S. stock exchanges to exploit American workers and families—people who put their retirement and college savings in public companies. U.S. policy is letting China flout rules that American companies play by, and it’s dangerous. Today, the House joined the Senate in rejecting a toxic status quo. I’m thankful to Sen. Van Hollen and my colleagues on both sides of the aisle for supporting this commonsense solution to a threat that’s never been more urgent. President Trump has led the way in calling Chinese Communist dishonesty to account, and I’m glad to see this bill head to his desk,” said Kennedy.

“Millions of American families rely on modest investments to retire, send their kids to college, and weather financial emergencies. But many have been cheated out of their money after investing in seemingly-legitimate Chinese companies that are not held to the same standards as other publicly listed companies. This bill rights that wrong, ensuring that all companies on the U.S. exchanges abide by the same rules. I’ve been proud to work with Senator Kennedy on this bipartisan legislation, and I’m glad to see it pass the House with such strong support. I urge the President to sign this bill into law immediately,” said Van Hollen.

The Holding Foreign Companies Accountable Act prohibits securities of a company from being listed on any of the U.S. securities exchanges if the company has failed to comply with the Public Company Accounting Oversight Board’s (PCAOB) audits for three years in a row.

The bill would also require public companies to disclose whether they are owned or controlled by a foreign government, including China’s communist government. 

Many Americans invest in U.S. stock exchanges as part of their retirement and college savings, and dishonest companies operating on the exchanges put Americans at risk, as Luckin Coffee did. This legislation protects the interest of hardworking American investors by ensuring that foreign companies traded in America are subject to the same independent audit requirements that apply to their competitors in America and other countries.

“ASA applauds Senators Kennedy and Van Hollen, and congressional leaders on both sides of the aisles, for coming together to protect American investors and retirement savers from fraudulent companies controlled by the Chinese Communist Party (CCP). For far too long, the CCP has exploited American investors to finance its cyber army, its technology-driven elimination of civil liberties, its human rights abuses, and its destruction of the environment,” said American Securities Association CEO Chris Iacovella. 

Background:

Congress established the PCAOB to inspect audits of public companies, ensuring the information companies provide to the public is accurate, independent and trustworthy.

Currently, China’s communist government refuses to allow the PCAOB to inspect audits of companies registered in China and Hong Kong. Such companies represent a keen risk to American investors as nearly 11 percent of all securities class action lawsuits in 2011 were brought against Chinese-owned companies accused of misrepresenting themselves in financial documents.

According to the SEC, 224 U.S.-listed companies are located in countries where there are obstacles to PCAOB inspections. These companies have a combined market capitalization of more than $1.8 trillion.

In the last 10 years, the number of Chinese companies listed on U.S. stock exchanges has increased significantly, as those firms take advantage of the capital available in America.

The bill text is available here.