US brings new charges against Chinese tech giant Huawei

The Justice Department has added new criminal charges against Chinese tech giant Huawei and two of its United States subsidiaries, accusing the company in a plot to steal trade secrets. (AP)
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Updated 14 February 2020

US brings new charges against Chinese tech giant Huawei

  • The company issued a statement Thursday evening disputing the allegations and calling them “without merit”
  • The new allegations come as the Trump administration raises national security concerns about Huawei

WASHINGTON: The Justice Department has added new criminal charges against Chinese tech giant Huawei and several subsidiaries, accusing the company of a brazen scheme to steal trade secrets from competitors in America, federal prosecutors announced Thursday.

The new indictment also alleges the company provided surveillance equipment to Iran that enabled the monitoring of protesters during 2009 anti-government demonstrations in Tehran, and that it sought to conceal business that it was doing in North Korea despite economic sanctions there.

The company issued a statement Thursday evening disputing the allegations and calling them “without merit.”

The new allegations come as the Trump administration raises national security concerns about Huawei, the world’s largest telecommunications equipment manufacturer, and aggressively lobbies Western allies to bar the company from wireless, high-speed networks.

The superseding indictment, brought by federal prosecutors in Brooklyn, adds to the company’s legal woes in the US It adds charges of racketeering conspiracy and conspiracy to steal trade secrets to an existing criminal case in New York, where the company already faces charges of lying to banks about deals that violated economic sanctions against Iran.

Federal prosecutors in Seattle have brought a separate trade secrets theft case against the company. Meng Wanzhou, a senior Huawei executive and the daughter of the company’s founder, is accused of making false representations to banks about Huawei’s relationship with its Iran-based affiliate. She was arrested in
Vancouver, British Columbia, and has yet to be extradited to the US.

The latest indictment, an update of a case first filed last year, accuses Huawei of plotting to steal the trade secrets and intellectual property of rival companies in the US.

In some instances, prosecutors said, Huawei recruited employees of competitors to steal intellectual property. The company also provided incentives to its own employees by offering bonuses to those who brought in the most valuable stolen information, and it used proxies, including professors at research institutions, in the pursuit of inside information, prosecutors said.

The stolen information included antenna and robot testing technology as well as user manuals for Internet routers. One goal of the theft, the Justice Department said, was to allow Huawei to save on research and development costs. The indictment details efforts to steal from a half dozen companies.

In one May 2013 episode, according to the indictment, a Huawei engineer removed a robot arm from the laboratory of a rival company based in Washington state, stashing the item in a laptop bag. The engineer emailed photographs and measurements of the arm to others at Huawei before the arm was returned to the company, which had discovered the theft.

At a 2004 trade show in Chicago, a Huawei employee was found in the middle of the night in the booth of a technology company, “removing the cover from a networking device and taking photographs of the circuitry inside,” prosecutors said. The employee wore a badge that listed his employer as “Weihua,” or Huawei spelled with its syllables reversed.

The indictment also lays out steps that the company to conceal its business dealings with Iran and North Korea, including by referring to both countries in internal documents by their code names.

In a statement, Huawei called the new indictment “part of the Justice Department’s attempt to irrevocably damage Huawei’s reputation and its business for reasons related to competition rather than law enforcement.”

“These new charges are without merit and are based largely on recycled civil disputes from last 20 years that have been previously settled, litigated and in some cases, rejected by federal judges and juries,” it said. “The government will not prevail on its charges, which we will prove to be both unfounded and unfair.”

Trump administration officials, including Cabinet secretaries, have recently leveled national security allegations against Huawei in an effort to encourage European nations to ban the gear from next-generation cellular networks.

Secretary of State Mike Pompeo and Defense Secretary Mark Esper made the pitch to Western allies during a trip to Munich this week. Attorney General William Barr, in a speech last week, lamented what he said was China’s aspiration for economic dominance and proposed that the US invest in Western competitors of Huawei.

The administration’s national security adviser, Robert O’Brien, asserted this week that Huawei can secretly tap into communications through the networking equipment it sells globally. The company disputes that, saying it “has never and will never covertly access telecom networks, nor do we have the capability to do so.”


East China cities quarantine arrivals as virus spreads in S. Korea, Japan

Commuters wearing protective face masks amid fears of the spread of the COVID-19 coronavirus ride an elevated train in Bangkok. (AFP)
Updated 26 February 2020

East China cities quarantine arrivals as virus spreads in S. Korea, Japan

  • South Korea has reported 10 deaths and almost 1,000 infections, while Japan has 159 confirmed cases, not including 691 on a cruise ship that was quarantined near Tokyo

BEIJING: The eastern Chinese city of Qingdao is imposing a 14-day quarantine on all arrivals, state media reported on Tuesday, as China moves to address the threat of a rise in coronavirus cases in neighboring South Korea and nearby Japan.
People with suspected virus symptoms arriving in Qingdao, a major Northeast Asian transport hub in Shandong province, should be isolated in designated hospitals, while others are required to stay at their residences or designated hotels, the official Xinhua news agency said.
The rule came into force on Monday, Xinhua added, citing a local government statement.
“Apparently 100,000 South Koreans live in Qingdao, and there are normally over 300 flights a week between Seoul and Qingdao,” Michael Pettis, a finance professor at Peking University, said on Twitter. “This is likely to be disruptive to both economies.”
Another Shandong city, Weihai, said it would quarantine arrivals from Japan and South Korea from Tuesday — the first country-specific compulsory quarantine requirement by China, which has criticized travel restrictions implemented by other countries.
The measures comes as the virus, which started in China’s Hubei province, takes hold beyond the country.
South Korea has reported 10 deaths and almost 1,000 infections, while Japan has 159 confirmed cases, not including 691 on a cruise ship that was quarantined near Tokyo.
Weihai is also home to a sizeable Korean expatriate community. It lies near the eastern tip of the Shandong peninsula across the Yellow Sea from South Korea, and its quarantine rules apply both to Chinese and foreign nationals arriving in the city.
They will be put up in hotels free of charge for a 14-day quarantine period, according to a notice on the city’s official Wechat account.

HIGHLIGHTS

● Qingdao imposes 14-day quarantine on all arrivals.

● Shandong city Weihai singles out S. Korea, Japan arrivals.

● S. Korea has almost 1,000 cases; Japan cases up.

People who arrived in Weihai from South Korea or Japan from Feb. 10 onwards have already been contacted by the Weihai government, the statement said, adding it had “appropriately handled” cases of fever.
The government of a third Shandong port city, Yantai, on Tuesday said all business travelers and short-term visitors should stay in designated hotels.
Further north in China’s Liaoning province, the city of Liaoning — home to both North Korean and South Korean communities — is tightening screening of inbound passengers and will check the temperature of all arrivals, state broadcaster CCTV reported.
Sweden’s health agency said it would not introduce airport controls that take up resources but are “ineffective” because infected people may not show symptoms.
Ukraine International Airlines onboard personnel will wear rubber gloves and masks on flights from Italy.
Meanwhile, the drugmaker Moderna has shipped a potential coronavirus vaccine for humans to government researchers for testing.
Shares of the biotech company soared, a day after the company said it sent vials to the National Institute of Allergy and Infectious Diseases for early-stage testing in the US.