New Huawei Indictment Alleges Trade-Secret Theft, Secret Surveillance

BROOKLYN, N.Y. (CN) — Prosecutors unsealed a superseding federal indictment Thursday that puts the Chinese tech company Huawei at the center of a conspiracy to steal trade secrets and to do business with the globally sanctioned countries Iran and North Korea.

As detailed in the Eastern District of New York filing, Huawei’s projects included domestic surveillance in Iran, a country that like North Korea faces sanctions from the United Nations, European Union and United States.

A staff member works on a mobile phone production line during a 2019 media tour in Huawei factory in Dongguan, China’s Guangdong province. (AP Photo/Kin Cheung, File)

“Huawei assisted the government of Iran by installing surveillance equipment, including surveillance equipment used to monitor, identify and detain protestors during the anti-government demonstrations of 2009 in Tehran, Iran,” the new indictment states.

Skycom, a subsidiary of Huawei, also allegedly employed at least one U.S. citizen, who is not named in the court papers.

The indictment continues that Huawei was involved in multiple projects in North Korea, but its representatives repeatedly denied and concealed that information.

Prosecutors also accuse Huawei of siphoning goods and services through local affiliates in sanctioned countries, using code words such as “A2” for Iran and “A9” for North Korea. Huawei employees also misrepresented their subsidiary Skycom as unaffiliated with their company, according to the indictment.

For products sent to North Korea in 2013, Huawei allegedly included the instructions “No HW logo,” abbreviating its own name. Huawei employees also misrepresented their subsidiary Skycom as unaffiliated with their company, according to the indictment.

As for the trade-secret theft, prosecutors say six U.S. technology companies were targeted for various intellectual property, including source code and user manuals for internet routers, as well as technology for antennas and robot testing.

“Huawei’s efforts to steal trade secrets and other sophisticated U.S. technology were successful,” prosecutors said in a statement. “As a consequence of its campaign to steal this technology and intellectual property, Huawei was able to drastically cut its research and development costs and associated delays, giving the company a significant and unfair competitive advantage.”

Meng Wanzhou, the company’s chief financial officer, is already under indictment in the case following her arrest in December 2018. She is currently in Canada fighting her extradition to the U.S. to face the charges of possible violations of Iran sanctions.

The first three counts in Thursday’s indictment — racketeering conspiracy, conspiracy to steal trade secrets and conspiracy to commit wire fraud — are fresh charges.

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