Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Friday, December 8, 2023 | Back issues
Courthouse News Service Courthouse News Service

Huawei CFO to be released after admitting to misleading bank execs

“The Princess of Huawei” admitted to misleading HSBC executives about the company’s dealings in Iran.

BROOKLYN (CN) — The chief financial officer of Huawei Technologies entered a deferred prosecution agreement on Friday in the Eastern District of New York, resolving criminal charges that include bank and wire fraud.

Meng Wanzhou, 49, admitted to misleading a senior bank executive regarding Huawei’s business operations in Iran, securing her release from custody in Canada, where she has been fighting extradition. Detained since 2018, she is expected to return home to China.

Meng was charged with conspiracy to commit bank fraud, conspiracy to commit wire fraud, and with bank and wire fraud. She was indicted in January 2019 along with Huawei and appeared by video conference in front of U.S. District Judge Ann M. Donnelly in federal court.

A translator on the conference call interpreted the court appearance into Mandarin. 

Charges against Meng will be dropped on Dec. 1, 2022, provided she complies with all terms of the agreement. 

Meng, who also goes by the first names Sabrina and Cathy, has been referred to as “The Princess of Huawei” — a technology company founded by her father, Ren Zhengfei.

Meng was a member of the board of directors of Skycom Tech, a Hong Kong-based subsidiary of Huawei. In a statement to the press, Meng referred to the relationship as a “normal business partnership,” inaccurately reflecting the nature of the companies’ relationship, according to a press release from the Department of Justice. 

Similarly, Meng made an August 2013 presentation to the financial institution in question — identified as HSBC by several news outlets — again calling the engagement a partnership. 

The true nature of the subsidiary-parent relationship would have been important to bank executives, federal agents said. 

Meng also claimed that Huawei “operates in Iran in strict compliance with applicable laws, regulations and sanctions,” and that the company did not violate any export control regulations — nor did any third party it worked with. 

Prosecutors said that claim was also untrue because Huawei’s operation of Skycom violated laws of the U.S. Department of the Treasury.

Huawei also caused Skycom to conduct $100 million in transactions through the bank, at least $7.5 million of which was sent to a United Kingdom-based staffing agency to provide engineers in Iran, in violation of U.S. laws, according to the DOJ. 

“In entering into the deferred prosecution agreement, Meng has taken responsibility for her principal role in perpetrating a scheme to defraud a global financial institution,” said acting U.S. attorney Nicole Boeckmann in a press release. “Meng’s admissions confirm the crux of the government’s allegations in the prosecution of this financial fraud — that Meng and her fellow Huawei employees engaged in a concerted effort to deceive global financial institutions, the U.S. government, and the public about Huawei’s activities in Iran.”

Prosecutors said they look forward to continuing their case against Huawei.

“Meng’s admissions are evidence of a consistent pattern of deception to violate U.S. law,” FBI Assistant Director Alan Kohler said. “The FBI will continue to aggressively investigate companies doing business in the United States when there are signs they behave with contempt for our laws.”

Huawei is, in turn, looking ahead to its continued prosecution.  

“We look forward to seeing Ms. Meng returning home safely to be reunited with her family,” the company said in email after the hearing. “Huawei will continue to defend itself against the allegations in the U.S. District Court for the Eastern District of New York.”

Meng's court appearance Friday began nearly an hour after it was scheduled to start, with Donnelly having been busy with another matter in the same building.

Fresh from charging the jury in the criminal case against singer R. Kelly, the judge offered an apology to the parties.

“I was otherwise detained,” she said.

Follow @NinaPullano
Categories / Business, Criminal, Financial, Technology

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.