Case against Meng ‘not complex,’ Crown says

VANCOUVER • Lawyers representing the Canadian attorney general say the fraud case against Huawei executive Meng Wanzhou is not complicated and a judge should commit the woman for extradition to the U.S.

The Crown delivered arguments Wednesday at a British Columbia Supreme Court hearing focusing on the legal test of double criminality, or whether the allegations against Meng are also a crime in Canada.

The U.S. has charged her with fraud over accusations she lied to an HSBC executive about Huawei’s relationship with Iran-based subsidiary Skycom, putting the bank at risk of violating American sanctions.

The defence has argued that the alleged conduct doesn’t amount to fraud in Canada because the country has no such sanctions and the bank wouldn’t have faced any financial risk.

However, Crown counsel Robert Frater said the judge does not necessarily need to consider American sanctions law to understand why Meng’s alleged misrepresentations put HSBC in peril.

“Ours is not a complex theory of this case. Lying to a bank in order to get banking services, (creating) a risk of economic prejudice, is fraud,” Frater said. “Fraud, not sanctions violations, is at the heart of this case.”

Frater said HSBC contacted Huawei in 2013 because it was concerned about news reports that Skycom was doing business in Iran, and Meng offered false assurances that Huawei no longer held a shareholding interest in the company.

HSBC faced significant reputational risk for processing Iran-related transactions because it was already operating under a deferred prosecution agreement for doing business in Libya, Sudan and Myanmar, he said.

The defence has noted that Canada withdrew sanctions against Iran in 2016, prior to Meng’s arrest in 2018. But Frater said what the Canadian government wants is of no interest to a bank.

“The bank has to ask: Is doing this business going to cause us to lose other business?” he said.

At the same time, Frater argued that case law does allow the judge to apply American sanctions law in a limited way as part of the relevant context.

The defence’s position that Justice Heather Holmes must completely ignore the foreign context is an “absolutist” one, and previous cases instead indicate she can use common sense, he said.

Meng’s lawyers argued the principle of double criminality is meant to uphold Canadian independence and values, ensuring that no one is surrendered for conduct that is not criminal locally.

But Frater countered that the judge’s job is not to stand up for Canadian sovereignty.

Justice Minister David Lametti will make the final decision on whether to surrender Meng to the U.S. Meng denies the allegations and is free on bail in Vancouver.

The case has fractured Canada-china relations. Following Meng’s airport arrest, China detained two Canadian citizens and restricted some imports.