(Adds details)
By Karen Freifeld and Kenneth Li
Sept 24 (Reuters) - Huawei Chief Financial Officer Meng
Wanzhou has reached an agreement with U.S. prosecutors to
resolve the bank fraud case against her, according to sources
familiar with the matter, in a process that should allow her to
leave Canada and relieve a point of tension between the world's
two super powers.
The U.S. government said it will appear in Brooklyn federal
court to discuss a resolution of charges against Meng, according
to a Friday court filing.
Meng was arrested https://www.reuters.com/article/us-usa-china-huawei/top-huawei-executive-arrested-on-u-s-request-clouding-china-trade-truce-idUSKBN1O42S1
at Vancouver International Airport in December 2018 on a U.S.
warrant, and was indicted on bank and wire fraud charges for
allegedly misleading HSBC about the telecommunications
equipment giant's business dealings in Iran, a story reported
first https://www.reuters.com/article/us-iran-huawei-hp/exclusive-huawei-partner-offered-embargoed-hp-gear-to-iran-idUSBRE8BT0BF20121230
by Reuters.
The deferred prosecution agreement, a Reuters exclusive https://www.reuters.com/technology/huawei-cfo-meng-appear-brooklyn-federal-court-2021-09-24
earlier on Friday, pertains only to Meng and U.S. charges
remain against the company, according to two other people
familiar with the matter.
Beyond solving a dispute between the United States and
China, the agreement could also pave the way for the release of
two Canadians, businessman Michael Spavor and former diplomat
Michael Kovrig, who are held in China after being arrested
shortly after Meng was taken in custody in 2018. In August, a
Chinese court sentenced https://www.reuters.com/article/china-canada-spavor-idCNL1N2PI07Y
Spavor to 11 years in prison for espionage.
A spokeswoman for Huawei declined to comment. A spokesman
for the U.S. Attorney's office in Brooklyn declined to comment.
An attorney for Meng could not be immediately reached for
comment.
Meng, who has also used the English first names "Cathy" and
"Sabrina," has said she is innocent and has been fighting
extradition to the United States from Canada. She is confined to
Vancouver and monitored 24/7 by private security that she pays
for as part of her bail agreement.
"HUAWEI CONFIDENTIAL"
Articles published by Reuters in 2012 https://www.reuters.com/article/us-iran-huawei-hp/exclusive-huawei-partner-offered-embargoed-hp-gear-to-iran-idUSBRE8BT0BF20121230
and 2013 https://www.reuters.com/article/uk-huawei-skycom/exclusive-huawei-cfo-linked-to-firm-that-offered-hp-gear-to-iran-idUKBRE90U0CA20130131
about Huawei, a Hong Kong-registered company Skycom and Meng
figured prominently in the U.S. criminal case against her.
Reuters reported that Skycom had offered to sell at least 1.3
million euros worth of embargoed Hewlett-Packard computer
equipment to Iran's largest mobile-phone operator in 2010. At
least 13 pages of the proposal were marked "Huawei confidential"
and carried Huawei's logo.
Reuters also reported numerous financial and personnel links
between Huawei and Skycom, including that Meng had served on
Skycom’s board of directors between February 2008 and April
2009.
Huawei was placed on a U.S. trade blacklist in 2019
that restricts sales to the company for activities contrary to
U.S. national security and foreign policy interests. The
restrictions have hobbled the company, which suffered its
biggest ever revenue drop in the first half of 2021, after the
U.S. supply restrictions drove it to sell a chunk of its
once-dominant handset business and before new growth areas have
matured.
The criminal case against Meng - the daughter of Huawei
founder, Ren Zhengfei - and Huawei is cited in the blacklisting.
Huawei is charged with operating as a criminal enterprise,
stealing trade secrets and defrauding financial institutions. It
has pleaded not guilty.
Judicial hearings in her extradition case in Vancouver
wrapped up in August, with the date for a ruling to be set on
Oct. 21.
A Canadian government official said Ottawa would be making
no comments until the U.S. court proceedings were over.
?Kovrig’s wife declined to comment.
CHINA vs USA
Huawei has become a dirty word in Washington, with a
knee-jerk reaction by China hawks in Congress to any news that
could be construed as the United States is going soft, despite
Huawei being hobbled by U.S. trade restrictions.
President Trump politicized the case when he told Reuters
soon after her 2018 arrest that he would intervene if it would
serve national security or help secure a trade deal. Meng's
lawyers have said she was a pawn in the political battle between
the two super powers.
Senior U.S. officials have said that Meng's case was being
handled solely by the Justice Department and the case had no
bearing on the U.S. approach to ties with China.
During U.S. Deputy Secretary of State Wendy Sherman’s July
trip to China, Chinese Vice Foreign Minister Xie Feng insisted
that the United States drop its extradition case against Meng.
U.S. officials have acknowledged that Beijing had linked
Meng's case to the case of two detained Canadians, but insisted
that Washington would not be draw into viewing them as
bargaining chips.
(Reporting by Karen Freifeld, Kenneth Li, Jon Stempel and
Michael Martina; editing by Chris Sanders and Edward Tobin)
HSBC Holdings (HSBA)