The Departments of Education and State have established a new partnership to examine foreign funding in American universities and to identify risks to sensitive research. This relaunch of the Department of Education’s foreign funding tracker reflects a growing recognition that foreign governments can use money to gain access to research, data, and academic programs to influence policy and future elites. Such access can threaten the U.S. economy and national security. Tracking foreign funding by source is an important first step. But it is not enough. The federal government still lacks a clear authority responsible for tracing how foreign money moves through universities and what influence it buys.
Foreign influence in American higher education moves through funding, research partnerships, talent pipelines, and informal knowledge exchange. One of the government’s main tools for addressing this risk is Section 117 of the Higher Education Act of 1965, which requires colleges and universities to report to the Department of Education any foreign gifts, funding, or contracts valued at $250,000 or more. According to the Department’s data, universities have self-reported $67.6 billion in foreign funding so far. Under the Biden administration, the enforcement of these requirements was conspicuously neglected. Under the second Trump administration, federal oversight resumed, with the Departments of Education and State coordinating their efforts.
The new cooperation between the Departments of Education and State shows renewed executive-branch attention to foreign funding in higher education. Still, Congress holds the authority to set national priorities and link academic security to national defense. In recent years, Congress has treated higher education as part of the U.S.-China Strategic Competition. This paradigm shift became more visible when Chairman Moolenaar, head of the House Select Committee on China, led efforts to incorporate the SAFE Research Act—a legislation designed to protect federally funded research from adversarial foreign influence—into the annual national defense bill, the National Defense Authorization Act (NDAA). The SAFE Research Act would have tied access to federal research funding to disclosure of ties to hostile foreign entities. By advancing the proposal through the NDAA, lawmakers signaled that academic research is a national security issue. Although the SAFE Research Act did not become law, it joined Section 117 and the Education–State partnership as part of a broader, multi-branch response to foreign influence. Chairman Moolenaar’s role positions Congress to connect agency-level transparency efforts to a broader national strategy.
The foreign funding tracker shows where the money comes from, but it is not very useful in identifying or mitigating strategic risk. First, universities report the data themselves, and the tracker only captures transactions above $250,000, leaving smaller or fragmented payments undetected. Of the $67.6 billion in reported foreign funding, 74.6 percent came through contracts, which typically do not reveal their terms or purpose to the public. The ten largest recipients of foreign funding are private universities, including Harvard, MIT, Stanford, Yale, Columbia, and Carnegie Mellon, meaning the public cannot access their records under the Freedom of Information Act (FOIA). Second, the tracker does not disclose how the foreign funds are used. Thus, the public can see that a university received foreign funds, but not whether it supported sensitive research, technical training, data access, or routine academic programs.
The tracker’s gaps matter because it cannot distinguish between normal academic cooperation and access sought for strategic or security purposes. When money comes from countries that openly work against U.S. interests, not knowing what the funding supports or who ultimately controls it creates real risk. China and Qatar rank among the top donor countries, and China in particular seeks access to dual-use technologies with both civilian and military applications. The National Association of Scholars (NAS) has documented cases where Chinese-linked partnerships involved sensitive research areas. For example, Georgia Tech and Alfred University had concerning ties to Chinese entities while working on hypersonic missile technology research, and the University of Michigan has faced scrutiny over biological materials and access by Chinese nationals. Yet the tracker cannot show whether foreign funding supported these sensitive activities or something entirely unrelated. The same opacity affects funding routed through intermediary jurisdictions. For instance, Bermuda appears as the source of more than $752 million to Carnegie Mellon University and $87 million to Columbia University, while Guernsey is listed as the source of $446 million to Yale. These are obvious evasions of U.S. law. Guernsey, with a population of about 67,000, appears to be funneling funds from some other entity or entities. Who? And why? The NAS has previously reported that universities frequently fail to report the foreign funds they receive.
The tracker’s design and real-world funding practices reveal a clear institutional oversight gap. No federal agency is responsible for tracking how foreign money moves through universities, how it is structured, or how influence builds over time. The Departments of Education and State can collect disclosures and assess diplomatic risk, but they do not investigate financial flows. By contrast, financial oversight agencies such as the Treasury Department and the Internal Revenue Service (IRS) already monitor complex funding structures, identify intermediaries, and flag suspicious patterns across the economy. Yet their tools appear to be absent in overseeing foreign funding in higher education.
Section 117 should require universities to explain how they use foreign funding, not just that they received it. Current reports list dollar amounts and source countries, but omit the details needed to judge risk. At a minimum, universities should report whether the funds are a gift or a contract, which department or program receives them, and whether they support research, teaching, training, or access to data in sensitive fields. Lawmakers should also revisit the $250,000 threshold to prevent foreign entities from avoiding disclosure by splitting funding into smaller payments. The NAS has also encouraged Congress to lower the reporting threshold to $50,000. A quarter of a million dollars is more than enough to seed a university with maligned influence or set up a lab to steal secrets in the open under the guise of “fundamental research.” Aggregation rules could require universities to report related payments together instead of treating them as separate transactions. These changes would not restrict academic collaboration, but they would make disclosure more than just a bureaucratic duty.
Foreign funding rules should identify who ultimately provides and controls the money, not just the immediate donor. Disclosure systems that stop at intermediaries show where money moves, but not who ultimately controls it. Section 117 should require universities to report the ultimate origin of foreign funds when money passes through third countries, foundations, or financial centers. Distinguishing funding by source country and structure would help policymakers separate routine academic activity from access sought for strategic reasons. At the same time, Congress should adopt the SAFE Research Act and apply its core principle: universities should not receive federal research funding if they maintain undisclosed or high-risk ties to adversarial governments. Without this information, funding tied to adversarial strategies can look no different from benign contributions, defeating the purpose of transparency.
Oversight of foreign funding in higher education should be assigned to a financial enforcement authority, specifically the Internal Revenue Service, working with the Treasury Department. The Departments of Education and State can collect disclosures, but they lack the tools to investigate complex funding structures, trace ownership, or detect patterns of financial influence. The Treasury Department and the IRS already do this work across the rest of the economy. Applying these tools to university funding would close major transparency gaps. Institutional accountability should work alongside federal oversight and public visibility. Universities that accept foreign funding should maintain independent compliance officers who operate outside university leadership and monitor foreign financial relationships. Like financial intelligence units in banks, these offices would track who provides funding and what that funding supports. Without a financial watchdog, foreign money can enter universities with little scrutiny of its source or purpose, leaving national security risks hidden behind paperwork.
In addition, Congress should adopt a ratio-funding rule that links federal support to the amount of foreign funding a university receives for sensitive research and workforce training. Federal dollars should not be matched or outweighed by foreign money from adversarial or high-risk sources. Under this approach, universities would face proportional reductions in federal support based on the volume of foreign funding they take on. Such a mechanism would protect educational independence and prevent taxpayer dollars from subsidizing institutions that also advance foreign strategic interests.
Recent reforms show that the U.S. government is moving in the right direction. The Education–State partnership and renewed enforcement of Section 117 reflect a growing awareness that foreign funding in universities raises real economic and security concerns. But transparency alone does not solve a problem unless it helps policymakers understand what is actually happening. When disclosure focuses on filing requirements instead of the substance of funding—namely, how foreign money is used, who ultimately controls it, and why it flows where it does—it risks becoming just another administrative exercise.
https://mindingthecampus.org/2026/02/27/dont-just-track-foreign-funding-of-u-s-universities-police-it/
