Huawei Hit With New Charges; CFO Named as Defendant

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U.S. prosecutors have charged the Chinese tech giant Huawei with racketeering and conspiracy to steal trade secrets.

The three new allegations, which add to earlier charges the company engaged in bank fraud and violated U.S. sanctions against Iran, were unsealed Thursday by a U.S. District Court in New York.

Prosecutors cited Huawei’s, “long-running practice of using fraud and deception to misappropriate sophisticated technology from U.S. counterparts.”

Huawei Chief Financial Officer Meng Wanzhou, the daughter of Huawei founder Ren Zhengfei, is named as a defendant in the case. Canada is determining whether to seek extradition of Meng.

Huawei CFO Meng Wanzhou

The company said it was, “not aware of any wrongdoing by Meng, and believes the U.S. courts will ultimately reach the same conclusion.” It accused the U.S. of seeking to “irrevocably damage” its reputation.

“This new indictment is part of the Justice Department’s attempt to irrevocably damage Huawei’s reputation and its business for reasons related to competition rather than law enforcement,” Huawei said.

“The ‘racketeering enterprise’ that the [U.S.] government charged today is nothing more than a contrived repackaging of a handful of civil allegations that are almost 20 years old and that have never been the basis of any significant monetary judgment against Huawei. The government will not prevail on these charges, which we will prove to be both unfounded and unfair.”

Prosecutors said a company called Skycom, a telecom equipment vendor that acted as an unofficial subsidiary of Huawei, assisted the Iranian government in domestic surveillance during demonstrations in Tehran in 2009. The U.S. accuses Huawei employees of lying about the relationship between the two companies.

“When confronted with evidence of wrongdoing, the defendants allegedly made repeated misstatements to U.S. officials, including FBI agents and representatives from the U.S. House Permanent Select Committee on Intelligence, regarding their efforts to misappropriate trade secrets,” prosecutors said in a statement.

Huawei pleaded not guilty to the first set of charges last March.

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