ADVERTISEMENT
ADVERTISEMENT
Top US banks helped China military-linked firm raise billions, alleges Congressional probe
CATL, the world’s largest battery manufacturer, was placed on the Pentagon’s Section 1260H list in January 2025 over alleged participation in China’s military-civil fusion strategy.
-
IANS - Fri, 22, May 2026
- 04:30 EDT
- 34
U.S. flag / IANS
Two American banks helped Chinese battery giant raise billions of dollars months after the U.S. government designated it a “Chinese military company”, according to a new congressional investigation that accused major Wall Street banks of putting profits ahead of national security concerns.
The report by the House Select Committee on the Chinese Communist Party said the two American banks (JP Morgan Chase and Bank of America) underwrote Contemporary Amperex Technology Co. Ltd. (CATL)’s initial public offering on the Hong Kong Stock Exchange in May 2025 despite warnings from the Department of War and bipartisan concerns over the company’s alleged links to China’s military and forced labour networks in Xinjiang.
“My committee’s investigation calls for serious policy changes to ensure what JPMorgan and Bank of America did never happens again. American banks must not help Chinese military companies raise money, because in doing so, they provide not only access to funding, but also legitimacy and credibility to companies that are helping our adversary build up its military,” Select Committee Chairman John Moolenaar said in a statement.
CATL, the world’s largest battery manufacturer, was placed on the Pentagon’s Section 1260H list in January 2025 over alleged participation in China’s military-civil fusion strategy, it said.
Also Read: Trump immigration hurting US innovation says expert
The report alleged both banks relied heavily on CATL’s assurances that the designation was “erroneous” and accepted the company’s denial that it had links to the Chinese military. Congressional investigators said CATL failed to fully answer due diligence questions regarding ties to the People’s Liberation Army, dual-use technologies and military-linked entities.
According to the report, Bank of America’s third-party due diligence relied on unnamed sources, including “a China-based ‘new energy academic’” and “a Chinese EV data provider”, while JPMorgan concluded CATL did not have transactions involving “military items or ‘dual use’ goods or technology”.
The Select Committee also alleged CATL maintained corporate and commercial ties with several Chinese entities already under U.S. restrictions, including Huawei, China State Shipbuilding Corporation, NORINCO and China Mobile. Investigators further claimed CATL held a stake in Wuhu Shipyard, described in the report as a defence-linked Chinese shipbuilder serving China’s naval sector.
The report further accused the banks of ignoring evidence linking CATL’s supply chain to forced labour concerns in Xinjiang. Investigators said CATL refused to provide full supply chain audits, but the banks still accepted the company’s assurances that there were “no connections to forced labour”.
In a separate case, the committee examined Morgan Stanley’s role in sponsoring the Hong Kong IPO of Zijin Gold International, a subsidiary of Zijin Mining Group, whose parent company and subsidiaries had been added to the Uyghur Forced Labor Prevention Act Entity List.
The report said Morgan Stanley internally acknowledged the UFLPA designation but proceeded after senior executives approved the transaction because “it was legal”. Congressional investigators said Morgan Stanley estimated fees from the deal at between $15.5 million and $23.1 million.
The committee recommended legislation prohibiting U.S. financial institutions from underwriting or sponsoring capital raising for blacklisted entities linked to foreign adversaries. It also called for CATL and its subsidiaries to be added to the Treasury Department’s Non-SDN Chinese Military-Industrial Complex list.
Discover more at New India Abroad.
Related
.JPG)
ADVERTISEMENT
ADVERTISEMENT
E Paper
Video
Comments
Start the conversation
Become a member of New India Abroad to start commenting.
Sign Up Now
Already have an account? Login