Revealing Report Uncovers Hidden Foreign Funding in American Colleges

Silhouette of hands exchanging money in dim light.

American colleges are failing to report billions of dollars in foreign funding, according to a new report.

At a Glance

  • The National Association of Scholars (NAS) published a report titled “Shadows of Influence: Uncovering Hidden Foreign Funds to American Universities”.
  • From 2010 to 2016, universities did not disclose 54% of reportable foreign gifts.
  • During the Trump administration, disclosures increased after an ED investigation found $6.5 billion in unreported foreign funds.
  • Under the Biden administration, underreporting resumed with at least 39% of gifts not disclosed.
  • The NAS has created a “Foreign Donor Database” to monitor and address these hidden funds.

Billions in Foreign Funding Undisclosed

A recent report by the National Association of Scholars (NAS) reveals that American colleges have not disclosed billions of dollars in foreign funding. Authored by NAS Fellow Neetu Arnold, the report indicates that from 2010 to 2016, 54% of these funds were not reported. The Trump administration saw improved transparency, but underreporting has resumed under Biden.

According to the report, these undisclosed funds present significant national security risks. The influx of foreign money, particularly from adversarial nations like China, could sway American policy and research directions. Section 117 of the Higher Education Act mandates disclosure of foreign gifts to the Department of Education (ED), yet many universities fail to comply.

https://mobile.twitter.com/EdWorkforceCmte/status/1721946437527699947

Trump Administration’s Push for Transparency

Under the Trump administration, an ED investigation uncovered $6.5 billion in unreported foreign funds, leading to increased disclosure rates. This improved transparency, uncovering previously hidden funds that are crucial to protecting national interests. However, under the Biden administration, the trend reversed, with at least 39% of gifts going undisclosed. Moreover, some universities ceased reporting altogether following the Biden ED’s decision to close a public portal for disclosures.

Foreign Donor Database

The NAS has created a “Foreign Donor Database” to address the issue of hidden funds. This database, formed through public records requests, aims to improve the monitoring of foreign gifts. The report offers four key recommendations to enhance transparency: making donor names and gift purposes public, auditing universities for compliance, and penalizing non-compliance. The NAS emphasizes the risks foreign funding poses from nations like Qatar, Saudi Arabia, Iran, China, and Russia.

The report also highlights how transparency failures, indirect foreign contributions, and the influence of foreign student tuition compromise the integrity of American institutions. A historical context of increased foreign student enrollment further underscores this concern.

Policy Recommendations

The report makes extensive policy recommendations, advocating for expanded and strengthened disclosure requirements, prohibitions on certain foreign financial supports, and enforcement of the Foreign Agents Registration Act (FARA). It also backs policies in the DETERRENT Act, which suggests reducing the disclosure threshold for foreign gifts and contracts, making a $0 threshold for countries posing threats to U.S. interests.

To summarize, the NAS report has shone a light on the opaque practices of American colleges in handling foreign funding. Enhanced transparency measures and stricter policy adherence are critical to safeguarding American education and national security.

Sources:

  1. Report: Billions in Foreign Gifts to American Universities Go Unreported
  2. ‘Ghost dollars:’ Universities secretly take billions in foreign money, report says
  3. Congress Asks Dept of Education to Enforce Foreign Gift Disclosure Laws

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