A Hong Kong and Shanghai Banking Corporation (HSBC) probe into Huawei helped the U.S. Department of Justice’s (DOJ) case against Huawei’s global CFO Meng Wanzhou.
An exclusive Reuters report revealed that the documents, which have not been made public, showed HSBC probed Huawei in late 2016 to 2017 to try and get the DOJ to dismiss criminal charges against the bank’s own misconduct with U.S. sanctions.
The documents, which was presented to the DOJ, were used to file the case against Meng, who was arrested in December 2018 in Vancouver.
Reuters reported Meng was accused of conspiring to defraud HSBC by not revealing Huawei’s relationship with Skycom, a telecom equipment seller that operates in Iran and is an unofficial subsidiary that helps transact business in the country.
Meng has said that Huawei has no connection to Skycom.
The DOJ accused Meng, Huawei and Skycom 13 counts of bank and wire fraud. The department also alleges that Huawei deceived HSBC and other banks to clear more than $100 million of transactions that were related to Skycom. These transactions have potentially violated economic sanctions against doing business with Iran.
Robert Sherman, a spokesperson for HSBC, said to Reuters: “Information provided by HSBC to the Justice Department was provided pursuant to formal demand, including grand jury subpoena or other obligation to provide information pursuant to a Deferred Prosecution Agreement or similar legal obligation.”
Reuters reported that these HSBC documents show financial details of Huawei’s relationship with Skycom. The probe also found that HSBC and the other banks relied on Huawei’s word in that it had not violated sanctions to do business with Iran and that it was not tied to Skycom.
The documents also reveal that investigators conducted more than 100 interviews, read through more than 292,000 emails, and analyzed numerous financial transactions, Reuters reported. It added that in the months after the probe, HSBC had thought about whether or not to continue doing business with Huawei. Eventually, the bank kept its relationship with the Shenzhen-based telecommunications equipment giant.
Meng is on bail in Vancouver and currently faces extradition to the U.S.
Canada has faced a frosty relationship with China since the arrest, and the federal government is conducting a review to decide whether or not to ban Huawei from providing 5G network equipment in the country.
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