GOOG Alphabet Inc

By Sarah E. Needleman 

President Trump said the U.S. government would look into national-security concerns raised by billionaire investor and Facebook Inc. board member Peter Thiel about Google's ties to the Chinese government.

The statement, tweeted by Mr. Trump on Tuesday morning, came after Mr. Thiel, in a keynote speech Sunday at the National Conservatism Conference in Washington, D.C., called for the FBI and CIA to investigate Alphabet Inc.'s Google unit, which he has claimed is working with China's government instead of the U.S. military.

"Billionaire Tech Investor Peter Thiel believes Google should be investigated for treason," Mr. Trump said in the tweet, adding "The Trump Administration will take a look!"

Mr. Thiel, an influential venture capitalist and co-founder of PayPal Holdings Inc., has long stood out in Silicon Valley as its most prominent conservative. He drew heavy criticism from many of his industry peers when he backed Mr. Trump's presidential campaign and later served as an adviser on his White House transition team.

Mr. Thiel didn't respond to a request for comment.

In an interview Monday with Fox News Channel's Tucker Carlson, Mr. Thiel suggested Chinese intelligence agents are likely to have infiltrated Google as it works on an artificial-intelligence project in the country. Mr. Thiel, in the interview, didn't offer evidence that backed his claims.

"If you say you're building a Manhattan Project for AI, don't you think that would attract the interest of foreign intelligence agents?" Mr. Thiel said, referring to the World War II-era project that led to the development of the world's first atomic bombs.

"As we have said before, we do not work with the Chinese military," Google said in a statement.

Google made a major retreat from China in 2010 when it pulled its search engine from the market in protest of the government's efforts to censor content and attempts to hack into email accounts of human-rights activists. Yet like Facebook and other tech giants, Google has tried to maintain a foothold in China in case that massive market ever opens up for business more broadly. It opened an artificial-intelligence lab in Beijing in 2017, a move aimed at attracting the country's tech talent.

Google Chief Executive Sundar Pichai has said the company has cautiously approached ramping up business in the country and in October said plans for a Chinese search engine were at a "very early" stage and that the company hadn't committed to moving forward with the project.

The Trump administration's trade dispute with China and its tougher scrutiny of the national-security risks from companies like Huawei Technologies Co. have made Google's efforts around China all the more fraught.

Mr. Trump's comments came only hours before executives from Amazon.com Inc., Apple Inc., Facebook and Google are poised to appear on Capitol Hill for a range of hearings. Google's parent and its U.S. peers have been grappling in recent months with increased scrutiny in Washington over issues including privacy, security and alleged anti-competitive practices.

Tuesday, a House panel is examining whether the companies' practices are stifling competition while a Senate panel will hear comments from a Google executive and critics of the company regarding alleged censorship through its search engine.

Earlier this year Mr. Trump said Google's CEO had expressed the company's commitment to the U.S. military and not the Chinese military during a White House meeting. The remarks followed comments at a March Senate hearing from Sen. Josh Hawley (R., Mo.) -- which Marine Gen. Joe Dunford reiterated in support -- alleging that Google is working indirectly or even counter to U.S. interests in its efforts to increase business in China.

Last year, Google decided not to seek renewal of a Pentagon cloud-computing contract that had drawn criticism from some employees. The company also said it wouldn't allow its artificial-intelligence products to be used in any military weapons.

Speaking on Fox Business Network on Monday, Larry Kudlow, director of the National Economic Council, said he doesn't believe Google is treasonous. "I meet with Google's CEO on a regular basis. I think they're working for America, for our military, not for China," he said.

"Peter Thiel's a good man. He's been a great supporter of the Trump administration. He's a very smart guy," Mr. Kudlow said. "I'm just not sure where he's going on this, so I have my doubts, but one never knows."

Rob Copeland contributed to this article.

Write to Sarah E. Needleman at sarah.needleman@wsj.com

(END) Dow Jones Newswires

July 16, 2019 11:24 ET (15:24 GMT)

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