US unseals two indictments against China's Huawei

By Michael Hernandez

WASHINGTON (AA) - The U.S. on Monday unsealed two indictments tied to alleged illegality by Chinese tech firm Huawei, including alleged theft of trade secrets.

A 13-count indictment charges Huawei, two Huawei affiliates — Huawei Device USA and Skycom Tech Co. — as well as Chief Financial Officer Meng Wanzhou with financial fraud related to attempts to evade U.S. sanctions on Iran.

U.S. prosecutors are attempting to extradite Meng from Canada, where she has been released on bail after being taken into custody at Vancouver International Airport last month.

She is accused of being behind an elaborate scheme to deceive financial institutions and the U.S. government about Huawei's operations in Iran.

The U.S. accuses Huawei of doing business in Iran using a Hong Kong-based shell company, Skycom, and lying about its ties to the company. Meng allegedly sat on Skycom's board of directors and was integral to the plot.

"Chinese firms have broken our export laws and undermined sanctions, often using U.S. financial systems to facilitate their illegal activities," Commerce Secretary Wilbur Ross said in a statement announcing the charges. “This will end."

Huawei is one of China's largest telecommunications companies.

A separate 10-count indictment charges the company with stealing trade secrets from U.S.-based telecommunications company T-Mobile and then attempting to obstruct justice when the company threatened to sue Huawei.

The alleged theft dates back to 2012, when Huawei began efforts to steal information about a robot T-Mobile uses to test phones, according to the indictment.

The effort included Huawei employees clandestinely taking photos of the robot, taking its measurements and stealing one of its pieces in a bid to reverse engineer it. All of the alleged impropriety violated confidentiality and non-disclosure agreements.

After T-Mobile sought to file a legal challenge, Huawei sought to blame rogue actors in a bid to diffuse the blame.

“To the detriment of American ingenuity, Huawei continually disregarded the laws of the United States in the hopes of gaining an unfair economic advantage," FBI Director Christopher Wray said.

The indictments come as trade talks between Washington and Beijing are slated to take place later this week from Jan. 30-31.

They come amid a 90-day pause in the bilateral trade war between the countries agreed to on Dec. 1. A U.S. delegation traveled to Beijing from Jan. 7-9 for the last round of talks.