US denies Canadian sovereignty at stake in Huawei case
A Vancouver court hearing into the extradition of the chief financial officer of Huawei on fraud charges for breaching Iran sanctions was told by US lawyers that it was not its job to protect Canadian sovereignty.
This directly challenged the defence claim for Meng Wanzhou that the US government’s case against the Huawei executive be denied because Canada should not be required to enforce US national security goals.
But crown lawyer Robert Frater, acting on behalf of the US, told British Columbia Supreme Court justice Heather Holmes in opening arguments that the essence of the US government’s case against Ms Meng was fraud.
“Lying to a bank in order to get banking services that create risk of economic prejudice is fraud,” Mr Frater said, referring to a 2013 power point meeting in Hong Kong with executives of UK-based bank HSBC, when Ms Meng allegedly misrepresented the Chinese telecoms group’s ties with a subsidiary that was operating in Iran. “Fraud is at the heart of this case,” he added.
Mr Frater said the court must consider all the evidence of fraud. “Your job is not . . . to stand up for Canadian sovereignty. Such concerns are for the executive,” he said. He added: “Your job is not to look at jurisdictional issues. That too is a matter for the executive.”
His presentation challenges the defence team’s claims that Ms Meng, who is also the daughter of Huawei’s founder, should not be extradited because the fraud counts were disingenuous and the case was really about Donald Trump’s foreign policy.
The detention of Ms Meng in December 2018 sparked an immediate crisis between Canada and China and is the most contentious flashpoint in the global effort by Mr Trump’s White House to combat Huawei’s growing dominance of 5G mobile technologies. US authorities have argued Beijing can use Huawei equipment to spy on the west.
Mr Frater said the misrepresentations Ms Meng allegedly made were critical because the UK bank made decisions based on them. He noted at the time HSBC was subject to a US deferred prosecution agreement and would have been concerned about dealing with companies operating in Iran. The five-year DPA with the US Department of Justice arose after the bank was fined for money laundering and sanctions breaches. It ended in 2017.
HSBC signed the DPA and paid $1.9bn of fines in 2012 to avoid criminal charges for allegedly laundering at least $881m for Mexican drug barons and handling transactions for countries under US sanctions, such as Iran, Libya and Sudan.
Mr Frater said it did not matter if HSBC in fact suffered any financial loss over the misrepresentation because “every business has to be concerned about its reputation, particularly one on a deferred prosecution agreement”.
“You have to be in a position to know who you are dealing with,” he said.
Unlike the first day of the hearing on Monday, when protesters were camped outside the court carrying signs demanding Ms Meng’s release, no protesters were to be found outside court on Wednesday.
That followed the discovery by local media that many of the young people — some aspiring actors — were offered up to $150 to appear in what they were told would be a film shoot or music video. Some were shocked and surprised when the media peppered them with questions and expressed dismay and embarrassment as they claimed to have been duped.
The hearing continues.