Wall Street banks helped Chinese military-linked firm raise billions despite red flags, lawmakers find

By Fox News · Fox News

FIRST ON FOX: Congressional investigators are accusing major U.S. banks of helping a Chinese battery giant the Pentagon labeled a "Chinese military company" raise billions of dollars from global investors despite unresolved national security concerns. A new report from the House Select Committee on the Chinese Communist Party alleges JPMorgan Chase and Bank of America underwrote CATL’s Hong Kong IPO — helping the company raise money from investors through stock offerings — after the Pentagon designated the company under its Section 1260H list of Chinese military-linked firms in January 2025. The report also says JPMorgan, Bank of America and Morgan Stanley later participated in a second CATL offering. The report places Wall Street at the center of a growing debate in Washington over whether American financial institutions should continue helping companies the Pentagon has identified as linked to China’s military or military-civil fusion strategy raise money from global investors, even when those activities remain legal under current U.S. law. OUR ADVERSARIES ARE EVEN USING THE US BANKING SYSTEM. HERE’S HOW THEY GET AWAY WITH IT The Pentagon’s Section 1260H list identifies companies the War Department determines are linked to China’s military or military-civil fusion strategy, though the designation itself does not broadly prohibit U.S. investment or commercial activity. The committee argues the transactions exposed a major gap in U.S. policy because the designation carried reputational consequences but did not prohibit Wall Street firms from helping the company raise capital. "To be clear, the banks broke no U.S. law and the transactions were not prohibited by U.S. law," the report states. "But each bank made the choice to essentially disregard the U.S. government’s Chinese military company designation to make millions of dollars." "The banks trusted CATL’s representations over the considered judgment of the U.S. government," the report states. The report alleges J…