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Huawei Has Suspected Ties To Front Companies In Iran and Syria, New Documents Reveal (reuters.com)

Posted by BeauHD on from the behind-the-scenes dept.

An anonymous reader quotes a report from Reuters: The U.S. case against the chief financial officer of China's Huawei Technologies, who was arrested in Canada last month, centers on the company's suspected ties to two obscure companies. One is a telecom equipment seller that operated in Tehran; the other is that firm's owner, a holding company registered in Mauritius. U.S. authorities allege CFO Meng Wanzhou deceived international banks into clearing transactions with Iran by claiming the two companies were independent of Huawei, when in fact Huawei controlled them. Huawei has maintained the two are independent: equipment seller Skycom Tech Co Ltd and shell company Canicula Holdings Ltd. But corporate filings and other documents found by Reuters in Iran and Syria show that Huawei, the world's largest supplier of telecommunications network equipment, is more closely linked to both firms than previously known.

The documents reveal that a high-level Huawei executive appears to have been appointed Skycom's Iran manager. They also show that at least three Chinese-named individuals had signing rights for both Huawei and Skycom bank accounts in Iran. Reuters also discovered that a Middle Eastern lawyer said Huawei conducted operations in Syria through Canicula. Huawei, U.S. authorities assert, retained control of Skycom, using it to sell telecom equipment to Iran and move money out via the international banking system. As a result of the deception, U.S. authorities say, banks unwittingly cleared hundreds of millions of dollars of transactions that potentially violated economic sanctions Washington had in place at the time against doing business with Iran.

12 of 108 comments (clear)

  1. This is something to be proud of in China by butchersong · · Score: 2, Insightful

    Chinese see getting away with this as an admirable trait. If you get caught you lose face but... setting up a situation like this is like chum in the water to chinese businesses.

    1. Re:This is something to be proud of in China by times05 · · Score: 2, Insightful

      Getting away with what? Trading with with Iran, country that China has no sanctions against?

      Why should China give a frog's fart about US sanctions? Especially after US unilaterally broke its treaty with Iran.

      It's like a bully trying to pick on someone, then he glances back and sees all his "flunkies"/"followers"/"buddies" are staying out of it. He's on his own. Feeling a bit of panic, maybe some cold sweat coming on bully?

    2. Re:This is something to be proud of in China by fred6666 · · Score: 4, Informative

      China can (and does) trade with Iran. The problem is corporations/individuals doing so can't also trade with the USA. Huawei did. The other execs shouldn't step a foot in any country with extradition treaty with the USA.

    3. Re:This is something to be proud of in China by times05 · · Score: 4, Insightful

      If China wants to do something that's perfectly legal for them, US law doesn't "trump" it, even if that happens to be US president's name.

      If it's any consolation, US retains the right to be salty about it, maybe break some agreements or something with China, but common.... we all know agreements with US aren't worth the ink or paper they're written with/on, as evidenced by their breaking of agreement with Iran anyway.

    4. Re:This is something to be proud of in China by times05 · · Score: 2

      Why does US try to do business and travel through China if they sanction Chinese trade partners? What gives them the right?

      Go ahead, tell me about your superiority and how you can do things that others aren't allowed to do Adolf.

    5. Re:This is something to be proud of in China by tlhIngan · · Score: 3, Insightful

      If China wants to do something that's perfectly legal for them, US law doesn't "trump" it, even if that happens to be US president's name.

      Depends on the technology licenses. If that equipment contained any US export controlled technology, then yes heads will roll.

      After all, ZTE was basically given the death sentence by being barred from buying US technology for re-selling the technology to restricted countries. At least, until the President was handed some half billion dollars of "investment" and China granting them rare and valuable trademark protection. Not just one, but several more later on.

    6. Re:This is something to be proud of in China by WindBourne · · Score: 4, Informative

      This was not about America telling them that they were under sanctions.
      This was about Huawei buying American parts after promising to NOT sell them to a number of nations, including Iran/Syria.
      Then they turned around and have worked hard to hide the fact that they are not just selling the parts to Iran, but working with them and syria, etc to use it against the west.

      --
      I prefer the "u" in honour as it seems to be missing these days.
    7. Re: This is something to be proud of in China by WindBourne · · Score: 2

      I agree with you, except that the woman is in the crux of it all. She signed the paper work saying that they were not working with iran and then it turns out she is controlling the very company. I do not agree with our arresting her, but ....
      I will say that instead of going after her, I think that we just need to cut off Huwei and ZTE and prohibit anybody from giving them western parts. If China complains about it, too bad. The Chinese gov is obviously using these 2 to attack the west with.

      --
      I prefer the "u" in honour as it seems to be missing these days.
    8. Re:This is something to be proud of in China by Anonymous Coward · · Score: 2

      My understanding is that if they DID defraud an entity, it wasn't a US entity, but rather HSBC. Unless Meng was speaking with an HSBC US entity, I'm not sure this can be considered "trading" with the US, but simply an international entity.

      But none of this really matters, but it's simply not normal to seek criminal prosecution for what she supposedly did... A large fine, yes, but not jail time.

      ------------
      "Meng is charged with violating US sanctions on Iran. Yet consider her arrest in the context of the large number of companies, US and non-US, that have violated US sanctions against Iran and other countries. In 2011, for example, JP Morgan Chase paid $88.3 million in fines in 2011 for violating US sanctions against Cuba, Iran, and Sudan. Yet Jamie Dimon wasn’t grabbed off a plane and whisked into custody.

      And JP Morgan Chase was hardly alone in violating US sanctions. Since 2010, the following major financial institutions paid fines for violating US sanctions: Banco do Brasil, Bank of America, Bank of Guam, Bank of Moscow, Bank of Tokyo-Mitsubishi, Barclays, BNP Paribas, Clearstream Banking, Commerzbank, Compass, Crédit Agricole, Deutsche Bank, HSBC, ING, Intesa Sanpaolo, JP Morgan Chase, National Bank of Abu Dhabi, National Bank of Pakistan, PayPal, RBS (ABN Amro), Société Générale, Toronto-Dominion Bank, Trans-Pacific National Bank (now known as Beacon Business Bank), Standard Chartered, and Wells Fargo.

      None of the CEOs or CFOs of these sanction-busting banks was arrested and taken into custody for these violations. In all of these cases, the corporation – rather than an individual manager – was held accountable. Nor were they held accountable for the pervasive lawbreaking in the lead-up to or aftermath of the 2008 financial crisis, for which the banks paid a staggering $243 billion in fines, according to a recent tally. In light of this record, Meng’s arrest is a shocking break with practice. Yes, hold CEOs and CFOs accountable, but start at home in order to avoid hypocrisy, self-interest disguised as high principle, and the risk of inciting a new global conflict."

  2. Take out the hostage card! by hackingbear · · Score: 2

    Looks like someone can't get any succession from trade talks in Beijing.

    In the other news, Iraq is suspected to possess large amount of Weapons of Mass Destruction.

  3. The Chinese communist party by WCMI92 · · Score: 3, Insightful

    Is the real owner here. Any company that does business with China is subsidizing one of the most evil governments of all time. The ChiCom government is responsible for the mass murder of millions.

    --
    Corporatism != Free Market
  4. Ermagerd, international corp sells internationally by Uberbah · · Score: 3, Insightful

    Just imagine if this critical eye was aimed at, say, American arms dealers. Or the Bush and Clinton families. Or all the high profile politicians like Howard Dean and Tom Ridge who have been PR flacks for groups on the State Department's list as terrorists:

    https://www.salon.com/2012/02/...