Overview
- The bipartisan House Select Committee on China released a report on Wednesday that concluded Webull’s ownership, technology and workforce arrangements are “tied in structural ways” to the People’s Republic of China and could pose national‑security and data‑exposure risks.
- The report cites a Cayman‑and‑U.S. holding company structure, a Singapore tech entity, a mainland China subsidiary that provided R&D and a dual‑class voting structure that concentrates founder control as key sources of exposure.
- Lawmakers flagged October 2025 as an inflection point because Webull began carrying U.S. customer cash directly, a change the committee says increases the potential exposure of billions in American capital.
- Webull strongly disputed the findings, saying U.S. customer data is stored and access is controlled in the United States, while markets reacted with an immediate roughly 18–20% intraday drop in the company's shares and multiple investor‑lawyer inquiries opened.
- The committee recommended concrete steps—expanding SEC cross‑border work, new inspectability and data‑protection rules for broker‑dealers, and CFIUS coverage for foreign‑controlled broker‑dealers—that could raise compliance costs and trigger further regulatory or enforcement reviews.