US ends case against Huawei CFO who holed up in Canada for three years
- Reference: 1670200154
- News link: https://www.theregister.co.uk/2022/12/05/us_doj_ends_wanzhou_meng_case/
- Source link:
Judge Ann M. Donnelly last Friday dismissed the case after the US Department of Justice sought that action on grounds that Meng had complied with a deferred prosecution agreement. The deal was part of the long and complex dispute that arose over her role in Huawei's sales to Iran.
The matter started in 2018, when Meng was arrested in Canada after an extradition request from US authorities, who alleged that Huawei had done business in Iran through a subsidiary called Skycom that helped to ship HPE and Huawei products to the Islamic Republic. Meng was accused of making the deal possible, hampering investigations into Huawei's Iran ties, and hiding the role of financial institution HSBC in making it all possible.
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As US sanctions prohibit doing business with Iran, the accusations were serious.
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But the matter took on greater significance because Meng is the daughter of Huawei founder Ren Zhengfei, and at the time of her arrest was a director of the company. China considered Canada's arrest of Meng an affront that elevated the affair from the legal to the diplomatic sphere. Beijing charged a pair of Canadian nationals with espionage in a case all-but linked to Meng's plight.
Meng lived under house arrest in Canada during the resulting complex and lengthy legal action, before eventually [4]admitting to lying about the Iran deals, in return for being freed and allowed to return to China.
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That deal included entering into a deferred prosecution agreement (DPA) that saw some charges against her put on hold in exchange for taking responsibility for her principal role in perpetrating a scheme to defraud HSBC – provided she not to commit further crimes for four years from the date of her arrest.
Which was last Thursday, December 1.
The DoJ therefore last week filed a submission in which it observed an "absence of information that defendant Wanzhou Meng has violated any terms of the DPA through December 1, 2022." Absent further offending, the feds felt the remaining indictment against her should be dismissed without prejudice, meaning the matter cannot return to court.
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Which is why Judge Donnelly dismissed the case.
[7]Will Chinese giants defy US sanctions on Russia? We asked a ZTE whistleblower
[8]UK bans Chinese CCTV cameras on 'sensitive' government sites
[9]Federal bans aren't stopping US states from buying forbidden Chinese kit
[10]Xiaomi India names Qualcomm as destination for allegedly illegal payments
[11]Oracle and Huawei clouds the big movers on Gartner's conjured quadrilateral
Upon release, Meng was [12]made Huawei's chair and remains its CFO.
The USA, meanwhile, has moved on to broader sanctions against Huawei and China – most recently making it all-but-impossible for Huawei products to [13]win approval from regulators for stateside sales .
The US has also imposed numerous bans on Russia, which The Register mentions as they mean Vladmir Putin's regime has few likely sources of telecoms kit other than Chinese providers like Huawei.
Earlier this year, former ZTE USA employee Ashley Yablon [14]told The Register he thinks Chinese companies won't be able to resist selling to Russia despite sanctions.
Huawei now has almost nothing to lose by doing so, and execs like Meng know that staying away from nations that have extradition treaties with the US should mean they can go about their business with impunity. ®
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[4] https://www.theregister.com/2021/09/25/huawei_cfo_meng_wanzhou_agreement/
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y4169RRQZehrtZ-XJ3f2-wAAAE4&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
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[7] https://www.theregister.com/2022/03/28/ashley_yablon_zte_whistleblower_interview/
[8] https://www.theregister.com/2022/11/25/uk_government_china_cctv_ban_/
[9] https://www.theregister.com/2022/10/28/federal_bans_china_law/
[10] https://www.theregister.com/2022/10/04/india_xiaomi_qualcomm/
[11] https://www.theregister.com/2022/11/01/gartner_cloud_magic_quadrant_2022/
[12] https://www.theregister.com/2022/04/04/meng_wanzhou_huawei_rotating_chair/
[13] https://www.theregister.com/2022/11/27/fcc_china_equipment_authorization_ban/
[14] https://www.theregister.com/2022/03/28/ashley_yablon_zte_whistleblower_interview/
[15] https://whitepapers.theregister.com/
China fucked with Canada for years over this costing billions of dollars in trade and held a few citizens hostage in retaliation. All for doing America's thankless bidding.
On the plus side it forced Canada to invest in processing canola domestically instead of exporting raw seed. Downside, I think a lot of that is destined for biodiesel, not human consumption.
The view from Canada was a bit different.
As I pointed out in the comments in the comments to the previous story (which El Reg references in this one), the whole story was very badly reported on by the international press, who mainly just reprinted US official spin. The Canadian press attended the actual trials and their reports gave a very different picture.
To summarize a few points, the reason the US charges were constructed as "fraud" was to get around Canadian extradition law ("dual criminality"). Sanctions charges would have been tossed out by the court in Vancouver immediately, as Canada was still part of the European deal with Iran so no sanctions laws were violated in Canada. The US therefore constructed a very convoluted argument that "fraud" was committed because fraud is illegal in Canada, and they knew the judge in Vancouver was not able to take into consideration whether there was a genuine fraud case against Meng, just that fraud was also a crime in Canada and the US was charging her with that.
Meng's lawyers were able to obtain copies of documents directly from HSBC which contradicted versions provided by the US as evidence (they needed to show that they had some sort of evidence). The US versions of the documents turned out to have been edited by the US to remove significant exculpatory evidence. However, the extradition judge didn't consider these documents, as they were evidence of Meng's innocence and Meng's guilt or innocence could play no part in an extradition hearing which was only concerned with whether the right paperwork had been filled out and whether Canadian officials had behaved legally.
Canada is in the process of revising its extradition laws due to systematic abuse of the extradition processes by allies. This was already on the agenda before the Meng case and so had nothing to do with that. France in particular were notorious for extradition cases which turned out to lack substance upon actual trial. The extradition review is now back on the table after having been sidelined by the pandemic.
The Meng extradition case seemed to be on the point of collapse on abuse of process grounds when the US suddenly reversed course and decided they wanted a "deal" instead. Meng's strongest arguments against extradition had always been on abuse of process grounds, and the hearings on that were about to start when the deal to drop the extradition was reached. The evidence before the court showed that Canadian police and immigration officials had been doing illegal favours for their US counterparts, police were suddenly reversing their testimony and contradicting their written notes, and one of the key senior police witnesses had left the country (to go to Macau!) and had hired a lawyer to try to fight having to testify. There were a lot of people who may have found to have been involved in a lot of unsavoury activities if the hearings had proceeded. This sort of thing probably goes on all the time, the police just weren't used to dealing with someone who had the money to hire the lawyers to fight it.
A series of senior retired Canadian diplomats and cabinet ministers had advised Ottawa that they had sufficient grounds to toss the case on final review (this would have followed a judges decision). Trudeau however was desperate to avoid getting dragged into the issue because he had just taken a major kicking at the polls over the SNC legal scandal and wanted to avoid anything which might remind people of that, regardless of whether it was justified or not.
Canada had been pressing the US to make some sort of "deal". Trump however was not willing to accommodate him, although Trump's offer to China to release Meng in return for a good trade deal would likely by itself have provided grounds for Canada to refuse extradition at a later point in the process.
However, Trump was gone, and Biden was apparently more willing to be accommodating to Canada and so a deal was finally done. It was widely suspected that this was a quid pro quo in return for Canada not making a fuss over the cancellation of the Keystone XL pipeline.
Primary or secondary?
Can anyone clear this up for me - was Wanzhuo Meng accused of breaking primary or secondary US sanctions?