The US has agreed to drop its extradition request for Huawei CFO Wanzhou Meng after she admitted to misleading banks over the company's sales in Iran. As a result, she was able to leave Canada and fly to China, after being under house arrest for nearly three years in Vancouver.
Meng entered into a deferred prosecution agreement with US Department of Justice officials and was arraigned on charges of conspiracy to commit bank fraud and conspiracy to commit wire fraud, as well as bank fraud and wire fraud. She confirmed she made "multiple material misrepresentations" to a senior executive of a financial institution regarding Huawei’s business operations in Iran in an effort to preserve Huawei’s banking relationship with the bank, the DoJ said in a statement. The lender may have otherwise ended business with Huawei due to US sanctions against doing business in Iran.
Under the DPA, Meng agrees to commit no further federal, state or local crimes. If she breaks the agreement, she may be prosecuted for the sanctions case as well.
Skycom: partner or subsidiary
The case dates back to 2013, when Huawei was questioned over sales by the company Skycom in Iran. Skycom was previously a subsidiary of Huawei and transferred to another company in 2007; Meng continued to serve on its board until 2009. Reporting in 2012-13 by Reuters showed that Huawei continued to exercise control over Skycom, and Huawei's lenders raised concerns about the relationship. The company claimed that Skycom was only a partner and Huawei complied with the sanctions.
In December 2018, Meng was arrested by Canadian officials while flying through Vancouver. They were acting on behalf of a US extradition request for the executive and her role in misleading the banks. She has been under house arrest in Vancouver while the extradition request was heard. The case had been expected to resume in October, after hearings were completed earlier this year.
