Staff Reports
The House Select Committee on China just dropped a bombshell: big Wall Street banks allegedly helped firms tied to the Chinese Communist Party and the People’s Liberation Army raise billions. The committee says JPMorgan, Bank of America, and Morgan Stanley underwrote deals for companies with military links and forced labor concerns. If true, this is not just bad judgment. It is a national security problem.
What the Select Committee found
The committee’s investigation says JPMorgan and Bank of America moved ahead with underwriting the Hong Kong IPO of CATL, even after U.S. officials flagged the company as tied to China’s military. The report lists business links between CATL and defense entities, research ties to China’s military universities, and ownership stakes in shipyards that build naval vessels. Separately, the committee says Morgan Stanley sponsored the IPO of Zijin Gold even though its parent and Xinjiang subsidiaries are on the Uyghur Forced Labor Prevention Act entity list. The files the committee reviewed include due diligence and internal risk memos that raise real questions about why these deals went forward.
Why this matters to national security and labor rights
Underwriting an IPO does more than move money. It gives a company legitimacy and access to global capital markets. When U.S. banks help firms tied to China’s military-industrial complex raise billions, that money can free up resources for PLA modernization. And when the same deals involve companies with forced labor links, Americans are bankrolling abuse. That is not hypothetical. It is exactly what the committee says happened.
What should happen next
Congress and regulators must move beyond headlines. The committee has already issued subpoenas and laid out policy recommendations. Now the Justice Department, Treasury, and SEC should audit these deals and enforce the rules. Banks that ignored red flags should face penalties, tighter licensing rules, and limits on underwriting for high-risk foreign firms. If private banks want to play in geopolitics, they should expect oversight — and lost business when they violate U.S. national security.
Americans should demand answers, and Republicans in Congress should press for accountability with teeth, not press releases. This is about more than reputations and fines. It is about who gets funded and who gets empowered — and whether U.S. financial power will be used to strengthen friends or bankroll foes. If the allegations hold up, the people who approved those deals should pay a price. No more excuses, no more safe deniability, and no more underwritings that read like a balance sheet for Beijing’s next move.
