BlackRock whistleblower alleges cover-up of search engine to spot Chinese investments

BlackRock whistleblower alleges cover-up of search engine to spot Chinese investments

By Jonathan Stempel

NEW YORK (Reuters) – BlackRock was sued for $20 million by a whistleblower former vice president who said the asset manager fired him after shutting down a search engine that could track discussions of clients on illegal investments, particularly in China.

In a complaint filed Saturday, Hamdan Azhar said BlackRock ordered him in March 2022 to stop working on Trend Spotter, which he developed, and transfer his projects to Rightpoint, where his former boss Tiffany’s husband worked Perkins-Munn.

The Brooklyn resident said he was fired two months later after persistently objecting to a $2 million contract that BlackRock awarded to Rightpoint before Perkins-Munn resigned, calling him ” illegal personal transaction.”

He also said his new boss, Riaz Hakkim, declined to raise concerns about illegal investments Trend Spotter may have tracked and whether its revelations matched BlackRock’s public disclosures to investors and regulators.

Azhar said he began developing Trend Spotter in March 2021 as a “hackathon” project, and that it received “broad attention within BlackRock.” The New York-based firm ended March with $10.5 trillion in assets under management.

BlackRock had no immediate comment Monday.

Last summer, the Chinese Communist Party’s bipartisan screening committee began seeking information on whether BlackRock and index provider MSCI had facilitated investments in blacklisted Chinese companies.

In April, the committee found that Wall Street, through investments in index funds, funneled $6.5 billion in 2023 to 63 Chinese companies flagged by the U.S. government for supporting the Chinese military or its violations human rights.

BlackRock and MSCI have denied any wrongdoing and said they comply with U.S. laws.

Azhar said he joined BlackRock in February 2020 as head of data science for global marketing.

His lawsuit in a New York state court in Manhattan seeks $10 million each in compensatory damages and punitive damages for violations of state labor law.

Perkins-Munn and Hakkim are also accused, and according to the complaint, they now work at JPMorgan Chase and Fidelity Investments, respectively.

Neither company immediately responded to requests for comment. Azhar’s lawyer did not immediately respond to a similar request.

The case is Azhar v. BlackRock Inc et al, Supreme Court of the State of New York, County of New York.

(Reporting by Jonathan Stempel in New York; editing by Marguerita Choy)

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