Chi­nese exec lied to evade sanc­tions on Iran, U.S. charges

Pittsburgh Post-Gazette - - International - By Emily Rauhala and Anna Fifield

Nearly a week af­ter her ar­rest at a Cana­dian air­port, the U.S. charges against Chi­nese tech ex­ec­u­tive Meng Wanzhou fi­nally took shape Fri­day as a prose­cu­tor out­lined al­leged ef­forts to con­ceal the own­er­ship of a com­pany sus­pected of try­ing to skirt U.S. sanc­tions on Iran.

The fraud case dis­closed in a court in Van­cou­ver, Bri­tish Columbia, has rel­a­tively nar­row lines. At its heart are U.S. claims that the heir ap­par­ent to Huawei Tech­nolo­gies — one of China’s big­gest tech em­pires —— mis­led banks about Huawei’s sus­pected fi­nan­cial links to a Hong Kong­based com­pany called Sky­com. Ms. Meng could face up to 30 years in prison if con­victed.

But the fall­out from Ms. Meng’s ar­rest and pos­si­ble ex­tra­di­tion spills far be­yond the charges at hand.

The case has in­creased un­cer­tainty in global fi­nan­cial mar­kets, bring­ing an­other day of sharp losses from Asia to Wall Street be­fore a week­end breather. There also are wor­ries about pos­si­ble Chi­nese re­tal­i­a­tion for tar­get­ing Ms. Meng, the daugh­ter of Huawei’s founder and a ris­ing star among China’s busi­ness elite.

For the mo­ment, China in­sists the pros­e­cu­tion will not de­rail ef­forts to end the tar­iff­s­ling­ing trade bat­tles with the Trump ad­min­is­tra­tion.

Yet there is much to still play out.

Ms. Meng, wear­ing a green sweater, lis­tened in court as Crown Prose­cu­tor John Gibb-Cars­ley ar­gued that she poses a flight risk and should be de­nied bail as the ex­tra­di­tion process be­gins. That will give her at­tor­neys an­other chance to fight her trans­fer to the United States.

Ms. Meng was ar­rested at Van­cou­ver’s air­port as she trav­eled from Hong Kong to Mex­ico on Dec. 1, the same day that Pres­i­dent Don­ald Trump met Chi­nese Pres­i­dent Xi Jin­ping on the side­lines of the Group of 20 sum­mit in Ar­gentina.

There had been spec­u­la­tion that the charges were, in some way, linked to al­leged vi­o­la­tions of sanc­tions on Iran. Then, in a packed Van­cou­ver court­room, a prose­cu­tor for Canada’s Jus­tice Depart­ment of­fered up the first de­tails of the U.S. charges.

Ms. Meng is ac­cused of com­mit­ting fraud in 2013 by telling U.S. fi­nan­cial in­sti­tu­tions that Huawei had no con­nec­tion to Sky­com, which was re­port­edly sell­ing goods man­u­fac­tured in the United States to Iran in vi­o­la­tion of Amer­i­can sanc­tions on Tehran. Ms. Meng has con­tended Huawei sold Sky­com in 2009.

The United States claims Huawei uses Sky­com to do busi­ness in Iran to work around U.S. sanc­tions.

“Ms. Meng per­son­ally rep­re­sented to those banks that Sky­com and Huawei were sep­a­rate, when in fact they were not sep­a­rate,” Mr. Gibb-Cars­ley told the court. “Sky­com was Huawei.”

Meng Wanzhou

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