US lawmakers are reportedly subpoenaing the heads of JPMorgan Chase and Bank of America for their roles in the initial public offering (IPO) of a global Chinese battery supplier.
The lawmakers are demanding JPMorgan Chase CEO Jamie Dimon and Bank of America boss Brian Moynihan produce documents related to the Hong Kong listing of Contemporary Amperex Technology (CATL), which supplies batteries to Tesla and other electric-vehicle makers, reports the Wall Street Journal.
The politicians making the demands of the two US banks serve on the House of Representatives’ Select Committee on the Chinese Communist Party, which focuses on the national security threat posed by China.
In April, the congressional committee urged JPMorgan and Bank of America to cease their involvement in CATL’s listing since the U.S. Department of Defense (DOD) added CATL to its list of “Chinese military companies,” and the committee warned of “serious regulatory, financial, and reputational risks” if they did not.
Despite the warning, JPMorgan and Bank of America helped underwrite CATL’s IPO.
Says Rep. John Moolenaar (R-Michigan), the committee chair, in the subpoena,
“CATL’s industry-leading role in battery manufacturing – a sector explicitly targeted by China’s state-driven military-civil fusion policy – poses significant US investor and national security risks.”
The committee says in its subpoenas that the banks failed to produce previously requested information on the IPO matter.
Meanwhile, Dimon defended underwriting CATL’s IPO in a May interview on Bloomberg TV.
“We and other investment banks did a lot of due diligence around all the issues that people raised. If we thought it was wrong, we wouldn’t do it.”
Meanwhile, a Bank of America spokesman says the bank will continue to work with the committee.
Contemporary Amperex Technology says in its public documents that it believes the DOD incorrectly added it to the list and is “engaging with DOD to address the false designation.”
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