Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Analysis-Huawei CFO's admissions likely won't help U.S. in case against company

Stock MarketsSep 28, 2021 11:51AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
2/2 © Reuters. FILE PHOTO: Huawei Technologies Chief Financial Officer Meng Wanzhou speaks to media outside the B.C. Supreme Court following a hearing about her release in Vancouver, British Columbia, Canada September 24, 2021. REUTERS/Jesse Winter 2/2

By Karen Freifeld

(Reuters) -The admission by Huawei's chief financial officer that she misled a bank about the company's business dealings in Iran likely won't help the United States as it continues to prosecute Huawei for the same charges.

While Meng Wanzhou's admissions last week https://www.reuters.com/technology/huawei-cfo-meng-appear-court-expected-reach-agreement-with-us-source-2021-09-24 go to the heart of the financial fraud charges, legal experts say it will be difficult and perhaps impossible for prosecutors to use them against Huawei Technologies Co Ltd at trial.

And if the government were to try to use her admissions as leverage in any negotiations aimed at avoiding a trial, experts said, Huawei would likely say what she admitted was the result of extortion, or even a fabrication.

A spokesman for the U.S. Attorney's office in Brooklyn declined to comment, as did a Huawei spokeswoman.

A U.S. judge in Brooklyn on Friday accepted a deferred prosecution agreement between Meng and U.S. prosecutors to end the case against her. Meng appeared via video from Canada, where she had been fighting extradition since her arrest in 2018 on a U.S. warrant.

Meng's arrest was a key source of discord between Beijing and Washington https://www.reuters.com/world/china/white-house-xi-raised-case-huawei-cfo-recent-call-with-biden-2021-09-27, and also had repercussions for Canada. Within hours of the U.S. agreement and Meng's release, two Canadians who were detained shortly after Meng was taken into custody were freed from Chinese jails and flown home.

As part of the agreement, Meng acknowledged that Huawei controlled a company that operated in Iran, that its employees were Huawei employees, and that she had made false statements about the company at a 2013 meeting with an executive at a global bank, earlier reported as HSBC Holdings (NYSE:HSBC) PLC.

CROSS-EXAMINATION

The statement of facts laid out in the agreement could be seen as an admission by a high-level officer of Huawei, said Roland Riopelle, a New York white-collar defense lawyer not involved in Meng's case, "but if she is not available for cross-examination, it is almost certainly not admissible."

Meng https://www.reuters.com/business/huawei-heir-apparent-prepares-life-after-three-years-canada-court-battle-2021-09-24 flew home to China on Friday and is unlikely to return to the United States to help the government in its case against the company founded by her father, Ren Zhengfei.

In other cases, prosecutors typically call individuals like Meng to the witness stand to testify about their agreements with the government. But if Meng does not appear in court, Huawei cannot exercise its right to confront her as provided by the 6th Amendment of the U.S. Constitution. "If she does not come back, and no one has the opportunity to cross-examine her, it is inadmissible," said Charles Stillman, another New York defense lawyer.

The statement of facts identified Skycom Tech Co Ltd as a Hong Kong company that operated in Iran but was controlled by Huawei. It noted that Skycom was not a business partner, as Meng had claimed, and that Meng had falsely stated Huawei operated in compliance with applicable laws, regulations and sanctions.

Prosecutors said the deception by Meng and colleagues was intended to obtain banking services from global financial institutions in violation of U.S. sanctions against Iran.

The statement of facts also could be raised by the U.S. Department of Justice in talks with the company's lawyers in an effort to avoid trial, experts said, even if it would not be allowed in as evidence.Washington lawyer Juan Morillo, who often handles high-profile white collar and cross-border cases, said it "gives them some additional leverage in negotiations with Huawei."

But Morillo said the company could argue Meng's agreement was also the "product of extortion" because she may have felt forced to sign it to gain her freedom. So ultimately, he said, the value would be minimal.

Huawei can also note that it did not sign the agreement and is not bound by it. In fact, a Chinese foreign ministry spokesperson on Saturday said "the so-called 'fraud' charges against" Meng were "purely fabricated." "I've been in cases similar to this, and that's what the strategy is going to be with Huawei," said Morillo. "They'll say, 'This is a fabrication. This is the product of extortion and it has no binding effect on us at all.'"

Huawei faces wire fraud, bank fraud and conspiracy charges that included Meng. It also faces other charges, including for violating sanctions on Iran, obstructing justice, and conspiring to steal trade secrets from U.S. technology companies. It has pleaded not guilty.

Analysis-Huawei CFO's admissions likely won't help U.S. in case against company
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
milena villa escobar
milena villa escobar Sep 28, 2021 12:28PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Biden takes a knee to china.  Submit or be crushed Joey
Randy Randy
randy00 Sep 28, 2021 8:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
China wins again, darnit.
milena villa escobar
milena villa escobar Sep 28, 2021 8:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Get used to it my friend
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email