Members of the House and Senate are calling on the United States Department of Justice and Department of Defense to investigate consulting firm McKinsey & Company. In an open letter, lawmakers revealed that the company had concealed its provision of advisory services to the Chinese Communist government and military, potentially violating federal laws.
According to a statement released by the U.S. House Select Committee on the Chinese Communist Party on Friday, Chairman John Moolenaar, along with Senators Marco Rubio and Joni Ernst, jointly wrote to Defense Secretary Lloyd Austin and Attorney General Merrick Garland.
The lawmakers are urging an investigation into McKinsey’s misconduct and evaluating whether the company is still qualified to secure contracts with the Pentagon involving sensitive U.S. national security matters.
The call for an investigation into McKinsey has escalated political pressure on the consulting firm. In a 17-page open letter, members of Congress detailed the latest evidence of McKinsey’s work for the Chinese government and military, outlining the specifics of the company’s engagements with the CCP and its military.
They pointed out that McKinsey’s work in China could pose a serious threat to U.S. national security.
The open letter exposed that McKinsey had strategized for China’s “Made in China 2025” industrial plan and the “13th Five-Year Plan” (2016-2020).
Information from a promotional site operated by McKinsey in China indicated that the company had provided services to over twenty different central, provincial, and municipal government agencies, covering a wide range of issues in economic planning, urban redevelopment, and social sectors. This website has since been removed from the internet.
The letter stated, “McKinsey has put the interests of another client ahead of those of the United States government, signing sensitive government contracts with the Department of Defense without disclosing its collaboration with the Chinese (CCP) government and its state-owned enterprises on critical national issues, which is deeply concerning.”
Since 2008, McKinsey has received over $480 million in revenue from its consulting work for the U.S. Department of Defense. Procurement laws and specific contract requirements mandate the disclosure of potential conflicts of interest.
McKinsey has yet to respond to requests for comment from the media. The company previously stated that its policy of disclosing conflicts of interest complies with federal laws.
Lawmakers also questioned the testimony given by McKinsey Global Managing Partner Bob Sternfels during a congressional hearing in February, where he refuted claims of the company ever cooperating with the CCP or Chinese central government.
Finally, the lawmakers requested responses from the Department of Justice and Department of Defense by December 1, including an investigation into McKinsey’s misconduct and its qualification as a Pentagon contractor.
In May of this year, Rubio and Republican Senator Josh Hawley released a public letter accusing McKinsey of lying about its ties to the Chinese government.
On the other hand, McKinsey has been significantly reducing its operations in China. According to a report by The Wall Street Journal on Thursday, the company has cut about 500 positions. Currently, McKinsey still employs over 1,000 staff in the Greater China region.