Huawei chief financial officer Meng Wanzhou, who is out on bail and remains under partial house arrest after she was detained last year at the behest of American authorities, carries an umbrella to shield herself from rain as she leaves her home to attend a court hearing, in Vancouver, Thursday, Oct. 3, 2019. THE CANADIAN PRESS/Darryl Dyck

Huawei chief financial officer Meng Wanzhou, who is out on bail and remains under partial house arrest after she was detained last year at the behest of American authorities, carries an umbrella to shield herself from rain as she leaves her home to attend a court hearing, in Vancouver, Thursday, Oct. 3, 2019. THE CANADIAN PRESS/Darryl Dyck

Meng Wanzhou’s misrepresentations to bank would be crime in Canada: Crown

Huawei CEO denies allegations, ahead of a hearing on a double-criminality test

The Department of Justice says the allegations against Huawei executive Meng Wanzhou would be a crime in Canada and she should be extradited to the United States on fraud charges.

The department says in documents filed in B.C. Supreme Court that the allegations meet the crucial extradition test of “double criminality,” meaning if they had occurred in Canada they would be criminal under Canadian law.

The U.S. alleges Meng lied about Huawei’s relationship with its Iran-based affiliate Skycom to one of its bankers, HSBC, putting the financial institution at risk of violating U.S. sanctions against the country.

“Simply put, there is evidence she deceived HSBC in order to induce it to continue to provide banking services to Huawei,” says the Justice Department in the court documents released Friday.

The Huawei chief financial officer denies the allegations and is free on bail, living in one of her two multimillion-dollar homes in Vancouver, ahead of a hearing set to begin Jan. 20 that will focus on the double-criminality test.

Her legal team has argued the alleged misrepresentations do not amount to fraud. It says the case is really about the U.S. trying to enforce its sanctions against Iran even though Canada does not have the same sanctions.

However, lawyers for the Department of Justice say in the court documents that Meng’s alleged conduct put HSBC at risk of economic loss and is sufficient to make a case of fraud in Canada.

“To establish HSBC’s deprivation, there is no need to consider American sanctions law,” they say.

The documents say Huawei controlled the operations of its affiliate Skycom in Iran from at least 2007 to 2014. Skycom employees used Huawei email addresses and access badges and the company’s bank accounts were controlled by Huawei, the documents say.

At the same time, they say HSBC was Huawei’s most important international bank. HSBC and its U.S. subsidiary cleared more than US$100 million worth of transactions related to Skycom through the U.S. between 2010 and 2014, the Justice Department alleges.

It alleges that Meng met with a senior HSBC executive in 2013 and assured them in a PowerPoint presentation that Huawei no longer held a shareholding interest in Skycom and she had resigned from Skycom’s board. She also told them Huawei subsidiaries in Iran would not have business transactions with HSBC, the court documents say.

HSBC has a long-standing policy prohibiting relationships with Iran-based clients and processing Iran-related transactions through the U.S. to avoid exposure to American civil and criminal liability, the documents say.

“Had HSBC known of Huawei’s activities that breached American sanctions against Iran, HSBC would have re-evaluated its relationship with Huawei,” they say.

The bank risked fines and penalties for violating Iranian sanctions law by doing business with Skycom, both as a result of violating a previous deferred prosecution agreement and attracting additional penalties, the documents add.

The Department of Justice also says there is precedent for the court to consider a foreign legal context in a limited way in an extradition proceeding. Doing so would only reinforce the conclusion that the allegations meet the double-criminality test, it says.

“Consideration of American sanctions law only serves to assist this court to better understand why HSBC’s economic interests were at risk.”

Meng’s arrest at Vancouver’s airport on Dec. 1, 2018, has fractured Canada-China relations. Beijing detained two Canadians, Michael Kovrig and Michael Spavor, in a move widely seen as retaliation and restricted some imports including canola.

READ MORE: China-Canada relations hang in the balance as Meng extradition case to heat up

The double-criminality hearing starting Jan. 20 is scheduled for five days.

If the judge rules the test has not been met, Meng will be free to leave Canada, though she’ll still have to avoid the U.S. if she wants to evade the charges.

Laura Kane, The Canadian Press

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Former Vancouver Giants forward Evander Kane is seen here in Game 7 of the second round of the 2009 WHL playoffs against the Spokane Chiefs (Sam Chan under Wikipedia Commons licence)
Gambling debts revealed in details of bankruptcy filing by hockey star Evander Kane

Sharks left winger and former former Vancouver Giants player owes close to $30 million

A virtual marketplace and food concierge service has been launched by Willowbrook Shopping Centre in Langley (Special to Langley Advance Times)
Willowbrook Shopping Centre in Langley launches virtual marketplace and food concierge service

Customers can go online to shop product assortment assembled from centre’s food and beverage tenants

Fraser Health has included Brookswood Secondary School to its list of COVID-19 school exposures, alongside exposure events at Aldergrove Community Secondary and Betty Gilbert Middle schools. (Google Maps)
8 Langley schools now on COVID exposure list, 3 added on Tuesday

Public Health has initiated contact tracing

THROUGH YOUR LENS: Frosty came for a visit this past weekend to Sharon Vose’s South Langley home. Her grandchildren erected the snowman in her backyard. (Special to Langley Advance Times)
SHARE: Frosty returned for a short visit

Send us your photo showing how you view Langley, and it could be featured in a future edition

Langley RCMP say they arrested two suspected mail thieves Tuesday morning. (Black Press Media files)
Aldergrove mail thieves caught with letters scattered in Jeep

Both suspects were violating probation orders, police say

Dr. Penny Ballem, a former deputy health minister, discusses her role in leading B.C.’s COVID-19 vaccination program, at the B.C. legislature, Jan. 22, 2021. (B.C. government)
B.C. holds steady with 407 new COVID-19 cases Tuesday

14 deaths, no new outbreaks in the health care system

A Cessna 170 airplane similar to the one pictured above is reported to be missing off the waters between Victoria and Washington State. Twitter photo/USCG
Canadian, American rescue crews searching for missing aircraft in waters near Victoria

The search is centered around the waters northeast of Port Angeles

Jonathon Muzychka and Dean Reber are wanted on Canada-wide warrants. (Courtesy of Victoria Police Department)
Convicted killer, robber at large after failing to return to facility: Victoria police

Dean Reber, 60, and Jonathon Muzychka, 43, may be together

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

B.C. Premier John Horgan listens during a postelection news conference in Vancouver on Sunday, Oct. 25, 2020. THE CANADIAN PRESS/Darryl Dyck
30% of B.C. recovery benefit applications held up in manual review

The province says 150 staff have been reassigned to help with manually reviewing applications

Adam Dergazarian, bottom center, pays his respect for Kobe Bryant and his daughter, Gianna, in front of a mural painted by artist Louie Sloe Palsino, Tuesday, Jan. 26, 2021, in Los Angeles. (AP Photo/Jae C. Hong)
Kobe Bryant’s presence remains strong a year after his death

Tuesday marks the grim anniversary of the crash that took their lives

Surrey RCMP are investigating after a pedestrian was struck and killed at 183 Street and Highway 10 Friday night. (File photo)
Modelling of predicted transmission growth from the B117 COVID-19 variant in British Columbia. (Simon Fraser University)
COVID-19 variant predicted to cause ‘unmanageable’ case spike in B.C: report

SFU researchers predict a doubling of COVID-19 cases every two weeks if the variant spreads

RCMP officers wearing face masks to curb the spread of COVID-19 stand by. (THE CANADIAN PRESS/Darryl Dyck)
RCMP appeal for witnesses after hit-and-run leaves girl, 17, in critical condition

The Metro Vancouver teenager was found unconscious and critically injured after being hit: police

Most Read