Blumenthal delivered his harsh criticism during a three-hour hearing where two PGA Tour officials testified about the U.S.-based circuit's framework agreement with the Public Investment Fund (PIF), which controls LIV Golf.
Saudi Arabia's PIF governor, Yasir Al-Rumayyan, will be the chairman of the new entity, called NewCo in the framework, while PGA Tour Commissioner Jay Monahan will serve as CEO.
"Today's hearing is about much more than the game of golf," said Blumenthal. "It is about how a brutal, repressive regime can buy influence – indeed even take over – a cherished American institution simply to cleanse its public image.
"A regime that has killed journalists, jailed and tortured dissidents, fostered the war in Yemen, and supported other terrorist activities," added Blumenthal, who spoke of a feeling of "betrayal."
The Justice Department, which has been investigating the PGA Tour for trying to keep its players from defecting to LIV, could opt to sue to block the deal. It could also be reviewed by the Committee on Foreign Investment in the United States, or CFIUS, a Treasury-led committee that assesses mergers to determine whether they harm national security.
Critics have accused LIV Golf of being a vehicle for Saudi Arabia to improve its reputation, or "sports-washing," as it faces criticism of its human rights record, including the 2018 murder of Washington Post journalist Jamal Khashoggi, as well as its record on women's rights and gay rights.
The Saudi embassy in Washington did not immediately respond to Reuters when asked to comment.
The PGA Tour's shocking agreement with the PIF has raised concerns in Washington from lawmakers who are mistrustful of the kingdom and critical of its human rights record. They have vowed to take a deep look into the deal.
PGA Tour Chief Operating Officer Ron Price and board member Jimmy Dunne on Tuesday testified before the Senate Permanent Subcommittee on Investigations, which was chaired by Blumenthal.
"The PGA Tour is not that big in terms of players. If (LIV) takes five players a year, in five years they can gut us," Dunne said while detailing the threat LIV Golf would have been to the tour if a deal had not been reached.
Pressed on the amount of Saudi financial involvement, Price said: "There have been discussions. It would be a significant amount. North of $1 billion."
Blumenthal told Price and Dunne they still have a chance to stand up against sportswashing, against the Saudi monarch, and to stand up for America.
"There is something that stinks about this path that you're on right now because it is a surrender and it is all about the money and that's the reason for the backlash that you see,” the senator said.
The Senate committee also released a 276-page memo that included new correspondence on how the framework deal between the PGA Tour and Saudi-funded LIV Golf came together.
In the memo, it was revealed that the PGA Tour requested a side agreement with the PIF that LIV Golf CEO Greg Norman, a former world number-one golfer who has been the public face of the breakaway circuit, would be fired upon completion of a final agreement.
It also revealed a proposal for both Tiger Woods and Rory McIlroy, two of the sport's biggest names, to own LIV Golf teams and participate in at least 10 events on the breakaway circuit.
Members of 9/11 Families United, whose family members were victims of the September 11th, 2001, attacks, attended the hearing, and the advocacy group also submitted a statement for the official record.
"Today we are watching a truly bizarre spectacle, as the PGA Tour is effectively turning over the game of golf to the Kingdom of Saudi Arabia. We know why the PGA Tour is doing it — it’s for the money. But that isn’t why the Saudis are doing it," wrote Terry Strada, national chair of 9/11 Families United.
"They’re doing it as a public relations strategy to distract from their authoritarian past and present, and especially their unacknowledged culpability for supporting al Qaeda and the hijackers of September 11," Strada said.
The Saudi government has long denied involvement in the attacks, in which airplanes hijacked by al Qaeda crashed into New York's World Trade Center, the Pentagon outside Washington, and a Pennsylvania field. Nearly 3,000 people died.
