Washington, Aug 26 (IANS) The Republican chairman of the US House Select Committee on China has accused three American financial institutions of helping Chinese-founded fast-fashion company Shein pursue a Hong Kong listing despite allegations linking its supply chain to forced labour.
Congressman John Moolenaar called on the three American financial institutions, JPMorgan, Goldman Sachs and Morgan Stanley, to withdraw their support for Shein’s planned initial public offering, which he said was expected on the Hong Kong Stock Exchange next month.
Moolenaar said Shein had previously failed to secure listings in New York and London because of concerns over forced labour.
“For major U.S. banks to bankroll Shein’s IPO shows these institutions have no regard for human rights or the victims of forced labor who will be forced to pick cotton for Shein’s clothes,” Moolenaar said in a statement.
He accused the banks of being used by the Chinese Communist Party to bring foreign capital into China’s economy and financial markets.
“These American banks are being used as a tool by the CCP to bolster their declining economy and capital markets with outside money, enabling a CCP Ponzi scheme on the rest of the world,” Moolenaar said.
The lawmaker also questioned the banks’ stated commitments to US national security and human rights while supporting the proposed listing.
“It is unconscionable for the American leaders of these institutions to claim they care about U.S. national security and then underwrite a company tied to the CCP and its forced labor and genocide,” he said.
“Enabling the human rights abuses of Shein and the CCP is a stain they will never be able to wash out unless they end their support for this IPO immediately,” Moolenaar added.
The committee’s statement did not provide details about the specific roles being performed by JPMorgan, Goldman Sachs or Morgan Stanley in the proposed offering.
It also did not say how much Shein planned to raise through the listing or provide a precise date for the transaction.
No response from Shein or the three banks was included in the committee’s statement.
The accusations against Shein were made by Moolenaar and have not been presented as findings by a court or regulatory authority in the latest statement.
An initial public offering allows a privately owned company to sell shares to investors through a public stock exchange. Investment banks typically help structure an offering, prepare documentation, assess investor demand and sell shares.
Shein became one of the world’s largest online fashion retailers by offering an extensive range of inexpensive clothing and rapidly changing product lines.
The company’s supply chain and its possible exposure to cotton or other materials originating in China’s Xinjiang region have drawn scrutiny from American lawmakers.
The US government has accused China of committing genocide and crimes against humanity against Uyghurs and other predominantly Muslim minorities in Xinjiang. Beijing has denied allegations of widespread forced labour and human-rights abuses in the region.
–IANS
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