VANCOUVER, British Columbia (CN) – Huawei CFO Meng Wanzhou was back in B.C. Supreme Court Monday morning in downtown Vancouver after spending the weekend in jail as she continues her bid for bail on charges of defrauding international banks in connection with Huawei’s business dealings in Iran.
Ahead of the day’s proceedings, however, documents released by the court to the media shed light on the reasons for Meng’s arrest.According to an affidavit by Royal Canadian Mounted Police Constable Winston Yep, an officer with the force’s foreign and domestic liaison unit, the U.S. government requested Meng’s arrest on a provisional warrant based on allegations that “starting in at least 2009, Meng and others conspired to make misrepresentations to numerous financial institutions.”
“The motivation for these misrepresentations stemmed from Huawei’s need to move money out of countries that are subject of U.S. or EU sanctions – such as Iran, Syria, or Sudan – through the international banking system,” the warrant states.
According to the affidavit, U.S. authorities uncovered a conspiracy between Meng and others at Huawei to misrepresent to banks – including Hong Kong-based HSBC – the company’s control of Skycom between 2009 and 2014. Specifically, the affidavit says Meng and others lied about Skycom being operated as Huawei’s Iran affiliate in order to obtain and keep banking services from multinational institutions despite sanctions by the U.S. and the European Union.
The original warrant, according to Yep, was issued Aug.22, 2018, by U.S. District Judge Roanne L. Mann in the Eastern District of New York. Canada’s attorney general authorized the arrest after the U.S. learned Meng was traveling through Vancouver en route to Mexico on Dec. 1, the day she was arrested.
After dealing with procedural issues Monday, Meng’s lawyer David J.Martin picked up where he left off Friday, asking for his client’s release under strict conditions that include hiring a private investigation firm run by former police officers and GPS monitoring.
First on the stand was Scott Filer, chief executive officer of Lions Gate Risk Management, a former Royal Canadian Mounted Police officer and founder of Lions Gate. Meng’s lawyer Tamara Duncan led Filer through his company’s history and areas of expertise. He said Lions Gate is staffed primarily by former law enforcement and military personnel and hired by corporate clients for security services above and beyond what a company’s internal staff would typically handle. Duncan asked Filer if he was confident that Lions Gate could handle Meng should she be released on bail.
“There’s never any guarantees to these situations,” he said. “Security is not an exact science.”
But he said the combination of technology and a “human element” would likely be effective to keep tabs on Meng. Filer said his staff would refuse to allow Meng to enter situations they couldn’t control and would be prepared to make a citizen’s arrest if she fell out of line. Filer then walked the court through how his company along with a GPS monitoring firm would use surveillance technology in the case.
Crown prosecutor John Gibb-Carsley then questioned Filer,asking first how Lions Gate determined itself to be a “leading” firm in the field of risk management.
“You’ll agree with me that it’s not risk elimination,” Gibb-Carsley said.
Filer agreed, acknowledging this would be his company’s first time providing services to someone on bail.
Gibb-Carsley then asked whether Flier could guarantee that Meng wouldn’t flee under his company’s watch.
“There’s never a guarantee for anything in this business,” Filer said.
After a break, the court heard from Stephen Tan from Recovery Science Corp. which monitors subjects in the justice system with ankle bracelets. Tan spoke of “inclusion” and “exclusion” zones for defendants and said monitoring Meng would be possible using the company’s technology.
“These zones can be any size, any shape,” Tan said. “Violations are detected within seconds.”
The company is currently monitoring more than 100 subjects and Tan said the company’s obligations are to law enforcement rather than the subjects they monitor. Of the 500 cases the company has been involved in, he said, fewer than 50 defendants have been arrested during monitoring and only one has fled to his knowledge.
Prosecutor Gibb-Carsley pointed out GPS monitoring”doesn’t restrict physical movement.” Tan said technology is supplemented by human eyes watching dots on a screen where violations are monitored in real time and the court violations are detected nearly instantaneously.
After Tan’s testimony, Meng’s lawyers took the judge through case law involving bail and electronic monitoring before Martin began his closing arguments. He said Meng has an unblemished record and is rising to become a “social leader and role model” in her home country China.
“I hope I have demonstrated to you that she is a woman of character and dignity,” he said, adding Meng would not “throw her life’s work away” by breaching the court’s order and has no motive to do so.
He also said evidence to support the allegations is “far from overwhelming.” Meng, he said, would vigorously defend herself if extradited to “clear her good name.”
Meng’s husband also agreed to put up the couple’s two homes and cash for a total of $15 million as surety for his wife’s bail. Martin said it would be “inconceivable” for his client to flee.
“Given her unique profile as the face of a Chinese corporate national champion, if she was to flee or breach your order in anyway, she would embarrass China itself,” Martin said.
The “community custody plan,” Martin said, should give the court total confidence of Meng’s compliance with bail conditions if released. He said the combination of the services of Lions Gate Risk Management and Recovery Science would ensure Meng would comply with the court’s restrictions.
After Martin finished, Justice William Ehrcke asked about Meng’s husband’s immigration status since he proposed to live in Vancouver with his wife should she be released. He said it may not be appropriate to name someone who isn’t ordinarily a resident of Canada as surety, since they’d be effectively acting as Meng’s jailer.
Martin said Meng’s team was prepared to justify her husband taking on that role, before the judge brought up the argument that she has actively avoided the United States since March 2017, an issue briefly mentioned during Friday’s proceedings. Martin again told the court Meng and others from the company stopped going to the U.S. when it became clear the company wasn’t welcome to do business there, and then the court broke for lunch.
After the break, Martin told the court Meng’s husband has a visa allowing him to stay in Canada for six months which makes him a resident of British Columbia – a requirement to become a surety for bail. The judge expressed concern extradition cases can drag on for months or even years because Meng’s husband is on a temporary visa would not allow him to stay should the case face delays. Moreover, he said a surety’s responsibility is to function as a subject’s “jailer in the community,” and not just someone who assumes a financial risk.
“He is an adequate and appropriate surety at this stage,” Martin said, but the judge disagreed.
“Somebody who is here on a visitor’s visa is not a resident of British Columbia,” Ehrcke said. “It would be a frustrating and unfortunate exercise if I were to make an order and you find there is no suitable surety.”
Gibb-Carsley said Canada’s attorney general has”issues” with Meng’s husband being appointed as surety because of a”lack of connection” to Vancouver. The prosecutor said Martin’s attacks on the strength of the case are unfounded and Canadian extradition law calls for “expeditious” proceedings.
He also attacked the idea Meng and her family have any “meaningful” connection to Vancouver, having only spent weeks here every year as tourists, and none of the character references provided and sureties proposed had connections to Vancouver either.
“This underscores the lack of connection,” Gibb-Carsley said, “and heightens the risk.”
The proceedings will continue Tuesday morning.