On Senate floor, LIV Golf’s ‘takeover of American golf’ faces more scrutiny
PIF governor Yasir Al-Rumayyan and PGA Tour commissioner Jay Monahan announcing their parternship on CNBC in June.
CNBC
In a Wednesday hearing, U.S. Senator Richard Blumenthal (D-Conn.) made multiple statements about the Saudi Arabia Public Investment Fund, which underwrites LIV Golf. First came a subpoena of the PIF itself, demanding “documents related to PIF’s takeover of American golf and related investments throughout the United States.”
Blumenthal’s most definitive declaration about the PIF came a couple hours later when he closed the hearing by pointing to the lack of free speech and relative lack of free press in Saudi Arabia. “That’s why we’re using compulsory process,” Blumenthal said from the Dirksen Senate Building in Washington D.C. “Sunlight is the best disinfectant.”
In between the statements came a 100-minute hearing in front of the U.S. Senate Subcommittee on Investigations, of which Blumenthal is the chairman. The session, though it ebbed and flowed in various directions, was centered on the influence and power a foreign government like Saudi Arabia can hold (and theoretically buy) through investments it makes in American companies, including organizations such as the PGA Tour, which is negotiating with the PIF to begin a for-profit entity that oversees men’s professional golf.
An unknowable question, at least for now: How much does that matter?
Golf fans know the terminology well at this point, as the battle for the future of men’s pro golf has intersected with a cultural battle known as sportswashing. Critics see the billions of dollars the Saudi PIF has invested in pro golf — much of it poured into upstart league LIV Golf — as a reputation-laundering scheme for the Saudi government.
As Ben Freeman, a director of democratizing foreign policy at the Quincy Institute for Responsible Statecraft, cited in written testimony, “there is no business rationale that can explain the PIF’s extraordinary spending on the game of golf.”
“If the Saudi government is not buying into a profitable investment, what are they buying?” Freeman’s testimony continued. “In short, silence. They want to muzzle Americans critical of the regime. And they want to rebrand themselves. They want Americans to associate Saudi Arabia with golf rather than the brutal murder of Saudi dissident Jamal Khashoggi.”
Freeman was one of three witnesses testifying in front of senators who presented various facts about the PIF and its investments in the United States. In the last eight years, the PIF’s staff has grown by a factor of more than 30. The fund itself has grown to an estimated figure of $780 billion, five times what it was in 2015.
This has come largely during the reign of Saudi Prince Mohammed bin Salman (known as MBS), who enlisted his close friend Yasir Al-Rumayyan as governor of the PIF, and who reshaped the management of the PIF to sit on its board and the board that oversees it.
“In that respect, he has had overall control of the PIF since March 2015,” said Joey Shae, a Saudi Arabian researcher for Human Rights Watch. According to Shear, this level of power over a nearly trillion-dollar fund should bring an increased level of scrutiny as Saudi Arabia has “undergone one of the worst periods for human rights in the country’s modern history” under MBS.
As Senate digs in, PGA Tour’s star dealmaker slides into spotlight
As Wednesday’s hearing unfolded, several topics were raised, including the redacted nature of central American intelligence on Saudi involvement with 9/11. Ron Johnson (R-Wis.), the Senate minority leader, cut to the chase with a simple question to the witnesses:
What do you want us to do about it?
After all, it’s lawmakers like himself who could work to establish different regulatory practices that would help viewers understand, say, the business motives behind billions of dollars of investment in professional sports.
Ultimately, he’s talking about greater transparency. That’s largely what the subcommittee has been chasing since June, when two warring entities — the PGA Tour and the PIF — announced a framework agreement to come together and merge business interests. More transparency of foreign investment — that extends beyond simply the required disclosures of SEC filings from publicly-traded companies — would simplify the information disseminated to American audiences about the intentions of foreign governments.
A lack of this transparency, Freeman argued, would create a blueprint for authoritarian regimes to “garner influence in the U.S.” and gain “broader foreign influence over our government, our media, and the American public.”
It would limit disinformation, too, argued Brian Murphy, the third witness, who is the managing director of Logically AI, which identifies “hostile influence operations occurring on the internet.”
“Sportswashing is a form of disinformation to promote or demote stories about a country through U.S. athletes and their parent organizations,” Murphy wrote in his testimony. “Additionally, to bolster their activities in one area of influence operations, both [Saudi Arabia and China] have utilized social media to create accounts that appear to be Americans, but in reality, their respective governments operate to disseminate disinformation.”
The U.S. legal system has theoretically been in pursuit of transparency from the PIF for more than a year, since Aug. 3, 2022, when 11 LIV golfers filed a lawsuit against the PGA Tour. That suit eventually implicated Al-Rumayyan as the PGA Tour countersued and earned the right to name both as defendants.
Attempts to procure deposition have routinely been stonewalled, dating to 2022 when Al-Rumayyan asserted in a written declaration that being deposed would conflict with Saudi law and make him susceptible to a 20-year prison sentence. Al-Rumayyan was invited by the Subcommittee to testify at the July hearing that featured Jimmy Dunne and Ron Price on behalf of the PGA Tour, but he declined, citing scheduling conflicts. In the months since, according to Blumenthal, the PIF has struggled to provide availability for Al-Rumayyan and has declared him “an inappropriate witness.”
Hence Blumenthal’s subpoena. It’s the next step in a series of steps with uncertain efficacy. Which is how Blumenthal ended the hearing Wednesday afternoon, promising that hearings like the two we’ve heard thus far will continue. The letter Blumenthal issued to the subcommittee Wednesday explaining the subpoena concluded with a reiterated statement from an Aug. 16 letter he sent to Al-Rumayyan:
“PIF cannot have it both ways,” Blumenthal wrote. “If it seeks to reap the benefit of commercial engagement with United States markets and entities, it must be subject to the laws and oversight of Congress.”
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