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U.S. insurers seeking to wed non-U.S. suitors could face more scrutiny from a secretive national security review panel, not less.

Witnesses and lawmakers raised that possibility Tuesday, at a hearing organized by the House Financial Services monetary policy and trade subcommittee on the future of the Committee on Foreign Investment in the United States (CFIUS).

CFIUS reviews international mergers and acquisitions involving U.S. targets for potential national security concerns.

For life and health insurance agents, CFIUS may be best known as a federal agency slowing efforts by China Oceanwide Holdings Group Co. Ltd. to acquire Richmond, Virginia-based Genworth Financial Inc. Genworth — a major issuer of life insurance, annuities and long-term care insurance — has reported, in general statements included in documents filed with the U.S. Securities and Exchange Commission, that CFIUS, that CFIUS has expressed concerns about control over policyholders’ personally identifiable information.

(Related: Genworth Says China Oceanwide Deal Is Moving Forward)

At the House subcommittee hearing, lawmakers and witnesses focused mainly on matters such as changes in control over U.S. infrastructure and information technology.

But the participants also touched on other matters, such as whether Chinese deals for U.S. movie theaters could limit the kinds of films U.S. filmmakers can get distributed.

Derek Scissors, an analyst at the American Enterprise Institute, talked briefly about the concerns related to control over consumers’ personal information.

“A number of Chinese companies are now legitimately interested in acquiring U.S. counterparts which hold personal data for thousands of Americans or more,” Scissors said.

The problem is that, even if a Chinese company is privately owned, the Chinese government can get the personal data from the Chinese company, Scissors said.

The CFIUS is overloaded and takes a long time to rule on deals, Scissors said.

He said companies involved in deals often take use the delays as an excuse to withdraw, revise and re-file their applications, in some cases to try to get around CFIUS consumer data control concerns.

“The U.S. needs a clear and durable policy stance to protect personal data, not stalling by CFIUS until the companies ‘figure it out,’” Scissors said.

Several lawmakers at the hearing expressed a strong interest in protection of consumer data, and on the rules Congress could set to protect consumer data.

“This is going to be hard,” Scissors said.

Scissors said that any almost any deal involving any organization that does business with U.S. consumers could involve concerns about protection of personally identifiable information.

A Chinese deal for a U.S. sports team might not seem to involve any national security concerns, but, if a Chinese company did acquire the Washington Redskins, it could end up with a large amount of information about the ticket buyers, Scissors said.

“Not everything involving personal data is a threat to national security,” Scissors said.

But “there is a potential national security risk there” when personal data is involved, he said.

He said defining when a proposed change in control over personal information poses a potential national threat will be difficult.

Information about the hearing, including a link to a video recording of the hearing, is available here.

—Read Genworth and China Oceanwide Hint at U.S. Panel National Security Concerns on ThinkAdvisor.

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