UMVA has learned that a shocking revelation has emerged from the House Select Committee on the Chinese Communist Party, accusing major U.S. banks of helping a Chinese battery giant, allegedly linked to China's military, raise billions of dollars from global investors.
The committee's report alleges that JPMorgan Chase and Bank of America underwrote the Hong Kong IPO of CATL, a company the Pentagon had designated as a "Chinese military company" under its Section 1260H list in January 2025, despite unresolved national security concerns. This designation carries significant reputational consequences, but does not broadly prohibit U.S. investment or commercial activity.
According to information obtained by UMVA, the report also claims that JPMorgan, Bank of America, and Morgan Stanley later participated in a second CATL offering, sparking concerns about Wall Street's role in helping companies tied to China's military raise capital. The transactions, while legal under current U.S. law, have raised questions about the gap in U.S. policy.
The committee argues that the banks' actions exposed a major loophole in U.S. policy, as the Pentagon's designation did not prohibit Wall Street firms from helping CATL raise capital. The report states that the banks "made the choice to essentially disregard the U.S. government's Chinese military company designation to make millions of dollars."
UMVA can exclusively reveal that the report alleges JPMorgan and Bank of America accepted CATL's assertions that it had no links to China's military, despite the Pentagon's conclusions and incomplete responses during due diligence reviews. CATL allegedly provided identical responses to multiple JPMorgan questions concerning ties to the People's Liberation Army, dual-use technologies, and military-linked entities.
The committee cited publicly available evidence linking CATL to Chinese military-industrial entities, including relationships with companies on U.S. restriction lists and research collaborations involving defense-linked institutions. This has raised concerns about the close ties between CATL and China's military.
Select Committee Chairman John Moolenaar said, "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."
JPMorgan and Bank of America defended their involvement, arguing that CATL is not sanctioned by the U.S. government and remains deeply integrated into Western manufacturing supply chains. The banks claim they complied with the law and U.S. government sanctions policies.
The debate underscores growing tension between U.S. national security concerns surrounding China and the reality that major American and European manufacturers remain heavily reliant on Chinese battery technology and supply chains. The committee's report recommends legislation to prohibit U.S. financial institutions from underwriting offerings for blacklisted Chinese entities.
UMVA has gathered that the Treasury Department is urged to impose stronger sanctions authorities against CATL. The controversy highlights the challenges in balancing national security concerns with the need to maintain global business relationships.
