The Treasury Department is weighing whether or not it has the authority to launch an investigation into Elon Musk’s recent acquisition of Twitter, The Washington Post reported Tuesday evening.
Under the terms of the deal, foreign investors, including a member of the Saudi royal family, could potentially have access to confidential financial and user data, according to The Washington Post, citing anonymous sources familiar with the deal.
Treasury Department officials are examining their legal options to investigate the deal, but whether they were aware of this potential information sharing was unclear and the Department’s Committee on Foreign Investment in the United States (CFIUS) typically investigates foreign nationals, not U.S. citizens like Musk.
In the past, White House officials have considered launching an investigation of the deal on national security grounds, the Post reported, citing an anonymous source.
Two anonymous sources told the Post that the FBI had investigated the possible counterintelligence risks of the deal in the spring, but it was not clear if those initiatives were still underway or if they were ever elevated to the most senior officials in the organization.
White House Press Secretary Karine Jean-Pierre last week denied a report that the U.S. was considering national security reviews of Musk’s holdings, in particular Twitter and the satellite internet network known as Starlink, Reuters reported.
“CFIUS is committed to taking all necessary actions within its authority to safeguard U.S. national security,” a Treasury spokesperson told the Post. “Consistent with law and practice, CFIUS does not publicly comment on transactions that it may or may not be reviewing.”
CFIUS can investigate minority stakes by foreign investors in critical industries, not just full acquisitions, the Post reported. The Biden administration has faced pressure from a growing cohort of allies who are demanding an investigation of the Twitter deal, particularly over the $1.89 billion investment by the Saudis, making the royal family the second largest investor in the $44 billion deal after Musk himself.
“We should be concerned that the Saudis, who have a clear interest in repressing political speech and impacting US politics, are now the second-largest owner of a major social media platform,” Democratic Sen. Chris Murphy of Connecticut tweeted Monday in a thread calling for a CFIUS investigation of Musk’s acquisition.
Murphy further went on to note that between TikTok, which is owned by the Chinese firm ByteDance, and Twitter, two of the largest social media platforms in the country were owned “in whole or in part” by China or Saudi Arabia, a trend he characterized as “dangerous.”
The Treasury Department performing a cursory review of large deals is a fairly routine practice, and most such preliminary examinations do not result in a full investigation, the Post reported.