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Huawei executive skirted sanctions against Iran, declared court

Media waits outside of the highest court in British Columbia to cover the trial of Sabawe Meng Wanzhou, Huawei Technologies…

Media waits outside of the highest court in British Columbia to cover the trial of Sabawe Meng Wanzhou, Huawei Technologies chief financial officer. Don Mackinnon / AFP / Getty Images

South China Morning Post

She faces multiple charges, each with a maximum of 30 years in prison, and so is a fugitive, said a Canadian lawyer.

This story is published by POLITICO as part of a content partnership with South China Morning Post. It originally appeared on on December 7, 2018.

Sabrina Meng Wanzhou, chief financial officer of the Chinese telecommunications giant Huawei Technologies, deceivedly represented the Company in or around the United States and EU sanctions against Iran, a packed courtroom in Vancouver , Canada, heard on Friday.

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Meng, a daughter of Huawei founder Ren Zhengfei, was in the British Columbia Supreme Court for a bail hearing about fraud charges. The hearing ended without a decision and will continue on Monday.

The United States is also trying to surrender Meng in relation to Huawei’s alleged use of an unofficial subsidiary, Skycom, to postpone the sanctions, says a lawyer representing the Canadian government. 19659011] Meng was arrested at Vancouver International Airport on December 1, when she changed aircraft and has been detained since.

Meng entered courtroom 20 for her citizen’s hats wearing a green workout film, laughing and laughing when she assigned her lawyer in Vancouver, David J. Martin.

About 100 journalists filled the high security room, built to attempt terrorists involved in the bombing of an Air India flight from 1985 to Delhi, surrounded by collision-proof glass. Some Huawei teams, which apparently consisted of executives and lawyers, had reserved 20 seats in the public gallery, said lawyer Sarah Leamon as she tried to move journalists out of the way.

Scott Bradley, a senior vice president of Huawei who sat in the public gallery, refused to comment on the case. A man wearing a Chinese flagpole in the enamel, who featured prominently among the Huawei team, also refused to comment.

The Canadian government’s lawyer John Gibb-Carsley told the court that the United States sought Meng on “fraud prevention” involving the United States and EU sanctions against Iran.

Huawei used an unofficial subsidiary, Skycom, to run in Iran between 2009 and 2014, Gibb-Carsley told the court, “This was the core of the fraud.” [19659011] Meng “personally represented for banks like Skycom and Huawei were separate,” said the lawyer in 2013 after the banks became aware that Skycom did business in Iran.

A arrest warrant was issued for Meng by a New York judge on August 27, 2018, seeking her to institute fraud trial. Gibb-Carsley described that the United States became aware last month that Meng would soon travel through Canada, traveling from Hong Kong to Mexico.

On November 30, a Canadian judge arrived at a US request for Meng to be arrested and on December 1, she was imprisoned at Vancouver airport when she switched aircraft, Gibb-Carsley said.

It was doubtful whether Meng’s alleged breach of the United States and EU sanctions constituted a Canadian crime, which was required for extradition.

But Gibb-Carsley said that the alleged efforts to fool financial institutions about the character of Huawei’s relationship with Skycom were Canada’s crimes against fraud.

“Meng fooled financial institutions, thus putting their economic and financial interests at risk,” he said.

Gibb-Carsley said that Meng had engaged in an “extensive pattern of dishonesty”, as he opposed the castle and quoted her supposed flygrey. Meng had access to “a large amount of resources” and had “no meaningful connection” to Canada, he said.

He also said that she meets several charges, each of which has a maximum sentence of up to 30 years in prison. “There is an incentive to fly,” he said.

Ren, Huawei founder and Meng’s father are worth $ 3.2 billion, “said Gibb-Carsley, referring to US request for extradition. As he argued to release Meng, he apparently acknowledged that her husband, who was named but later identified by the surname Liu, lived in Canada.

He dismissed the idea that “Citizenship [against Meng fleeing] is her husband … but he is not a prison in society” and said that while Meng owns “two very expensive family homes” in Vancouver, there is no meaningful connection to this jurisdiction. “

The lawyer laughed at the gallery when comparing the defense’s $ 1 billion US $ 752 400 claim to the dollar, saying” we are not in the same universe. “

Meng had shown that she avoided travel to the United States, even though she had a 16-year-old son attending school in Boston, Gibb Carsely said.

Between 2014 and the beginning of 2017, Meng often traveled to the United States, he said. But the US authorities say that in April 2017, she became aware of the investigation when US-based Huawei executives were served as part of a major jury robbery. She had not visited America since then, he said.

After a 15-minute break, defense attorney Martin declared that the referee should be granted the sponsor for “you can rely on her personal dignity” and add: “You can trust her.”

If Meng violates a court order, it would “humiliate and spoil his dad, as she loves,” said Martin.

Martin explained that Meng’s potential deposit, apart from cash security, could contain her two homes in Vancouver, worth a total of about 14 million dollars.

He also portrayed the United States extradition request as incomplete and said: “We have no expense – The United States has not identified a charge in this material.”

He said there were “sharp flaws” in the timelines offered by the United States about Meng’s alleged fraud, and that Meng had been “very open” as Huawei once owned Skycom, and once she sat on the board, but that it had been sold in 2009.

Martin said that bank allegedly fooled by Meng about Huawei’s Iran agreements was “Hong Kong Bank”, which he called “the largest bank in the world.” He then identified it as HSBC, which is the world’s seventh largest bank with total assets and sixth of market capitalization.

The idea that a 2013 PowerPoint presentation to HSBC by Meng – as claimed by the United States represented fraud – could have allowed the bank to provide incorrect financial services “is preventive,” said Martin and told the court that the evidence presented by the United States as Huawei had secret control over Skycom did not cover the crucial element at the time.

Martin proved that Huawei maintained control over Skycom, which was probably disclosed in corporate stationery shared by companies and in Huawei’s e-mail addresses, once used by Skycom executives.

“A lot of people have logos of Apple on their documents,” he said. “That does not mean they’re Apple.”

He said that Meng had told bank governors that Huawei had done everything in order to maintain consistency in its relations with Iran and that nothing given to Iranian customers differed from products usually shared with other

Martin, who identifies HSBC like the bank in question, also said: “If there is an alleged conspiracy [involving Meng and a financial institution] I ask rhetorically, why has that company not been charged?”

He also rejected the idea that Meng had deliberately avoided the United States to avoid seizures. He said instead that her travel plans were dictated to a great extent by the US-China trade war.

“A device would have to be deaf deaf in order not to understand that the United States had become a hostile place for Huawei to do business,” he said. Huawei’s operations had thus been settled in the United States and there was little reason for her to go there, he said.

Martin left information about Meng’s private life and quoted an affidavit where she said she and her other husband, surname Liu, had a 10-year-old daughter.

She also has three sons from a previous marriage, he said. One, who is 14 living in Hong Kong; another 16, studying at Andover, near Boston, Massachusetts; and Meng has a 20-year-old son who works as a computer technician.

Martin read from Meng’s defense, Martin quoted her and said, “For a certain period, I was permanently resident in Canada.” This had expired in 2009, Martin said, but Meng retained extensive links to Canada and Vancouver, which should weigh to her favor to seek the sponsor.

Two of her children had completed some of her schooling in Vancouver. or three weeks in the city each year.

Meng’s memorandum said she had two passports, one from China and the other from Hong Kong, used to enter Canada on Saturday and had been seized. “I will give up both passages,” Meng said in her sworn statement, to support her pursuit of sponsorship.

The defense lawyer also said that Meng was not fit for imprisonment and cited a “carcinoma problem” as well as a blood pressure condition.

Martin stressed the size of Huawei and said it had gross revenues in 2017 of $ 19.2 billion and a gross profit of $ 7 billion. “Companies in Iran are marginal to this company,” he said.

The company had a special place in the Chinese business, and Meng would not counteract it by flying for granted the castle, Martin said.

“Her father would not recognize her,” he said. Her colleagues would contempt her. she would be a pariah. “

Martin offered as a letter of reference a letter from the principal of a private school in Massachusetts who participated in one of her sons. Meng was” a person with highest professional and moral norms, “the letter says.

The evidence of Meng’s arrest and the reasons for it had previously been subject to a publication ban issued at her request. However, it was raised as the first order of procedure at the hearing on Friday morning.

Martin did not oppose the action of William Ehrcke and said “the horse has left the barn.” The lift had been sought by a lawyer for various media organizations.

Despite the court’s suspension of the ban on publishing, the US Department of Justice refused to comment or leave any details about the order of Meng’s extradition.

Meng’s arrest, which became publicly available on Wednesday, sparked a boast from China, which demanded an explanation. Beijing has protested against both Ottawa and Washington.

The situation has explained among investors and US multinational companies worried about the potential impact that their leaders in China could face because of Meng’s arrest.

Questioned by South China Morning Post on Friday if China would be revenge against foreign business leaders in China, Chinese Foreign Ministry spokesman Geng Shuang said that China “has always protected the legitimate rights and interests of foreign citizens in China and should follow Chinese laws [when they are in China] “.

On Friday, Trump Administration’s highest economic advisor, Larry Kudlow, states that American companies should not change their business. “I would not stop business or disturb business just on the basis of Huawei,” said Kudlow, head of the National Economic Council, CNBC.

Instead, Kudlow suggested that US companies that have relations with China should play a role in advocating on behalf of the US Government, as it confront Beijing with trade and technology issues.

“If I were they, I would try to help us with all Chinese officials regarding these trade negotiations and trade opening and tariff reduction, non-tariff barriers of course technology issues,” he says. “So they should be with us.”

On Thursday, The US Republican Sen. Marco Rubio, a National Security Hook in China, said: “If Huawei has helped us to violate US sanctions by transferring US technology to Iran, they should be barred from acting in the United States or from buying American technology. “

Such a ban would harm Huawei due to the highly interconnected supply chain between Chinese telecom and their US component companies in the US, buying Huawei from various US companies, including Qualcomm, as it is developing its 5G technology.

Just in the spring another Chinese telecommunications equipment giant ZTE released over supply chain problems when the US Commerce Department said it failed to make promises to punish employees involved in unused sales to Iran and North Korea. The department imposed a seven-year ban on the sale of US companies to ZTE, a move that led ZTE to close its main business within a few weeks.

After Chinese President Xi Jinping asked US President Donald Trump to intervene, the ban was lifted and ZTE agreed instead to pay fines of up to 1.4 billion dollar, replace the board and install an American surveillance officer. But the ban was an alarm clock for China to realize that even its largest telecom company could barely survive without US suppliers.

The technically heavy Nasdaq Composite Index has lost more than 6 percent since Monday’s closing, partly as a result, worrying that Meng’s arrest will track talks between Washington and Beijing to resolve a bilateral trade war that started in July.

The case continues.

Owen Churchill and Jodi Xu Klein contributed to this report. ] This article was tagged in:

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