The ties between Las Vegas-based Remark Holdings and China are causing concern as the company bids to provide facial recognition and other technologies for U.S. infrastructure projects, Protocol reports.

Remark has shared photos of CEO Kai-Shing Tao with Texas Governor Greg Abbott and Chicago Mayor Lori Lightfoot, and has expressly stated that U.S. state and local governments are target customer groups due to the federal Infrastructure Bill.

Florida high-speed rail company Brightline is a client, which Florida Senator Marco Rubio suggested to Protocol is inappropriate if it is benefiting from Chinese state resources, but whether that is the case remains unclear.

The company has acknowledged sourcing “substantially all” of its hardware from an unnamed Chinese supplier in an SEC filing.

The concerns about cybersecurity and data privacy are made all the more acute by the lack of comprehensive federal data protection in the U.S.

Tao said during a recent earnings call that Remark is bidding on contracts with 40 train stations in China to provide its Smart Sentry software, which uses face biometrics to differentiate authorized staff like track workers from people who might pose a danger to themselves or others. Elsewhere in the country, it’s KanKan facial recognition is used in smart city systems.

Protocol delves into Remark’s history and the launch of KanKan, which it describes as a series of shell companies and subsidiaries.

Remark appears to be banking significantly on the opportunity to provide its facial recognition and other AI technologies in the U.S. market. Negative operating cash flow and net losses have added up to $333 million in debt, and a March financial statement showed that $2.6 million out of $11.5 million in payments it is owed from China were late.

The company’s full-time employees have been reduced from 290 to 74 in the past three years.

AI  |  biometrics  |  China  |  cybersecurity  |  data protection  |  facial recognition  |  government purchasing  |  Remark Holdings  |  stocks  |  United States

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