Latest news on US indictments against Huawei

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Updates on US indictments against Huawei Jan 31

Earlier this week, Chinese tech manufacturer Huawei was charged with 23 indictments by the United States Department of Justice. This comes after a long history of U.S. suspicion surrounding the company, and brings another layer of tension to the ongoing trade war with China.

The charges themselves range from the theft of trade secrets to the obstruction of justice to wire fraud. Huawei has denied these claims, setting the stage for the latest international feud regarding the future of the tech industry.

Allegations against Huawei

Out of the indictments given, a few allegations stand out as particularly severe. Here’s an overview of some of the most notable charges against Huawei.

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Evading Iran sanctions

Huawei allegedly lied on multiple accounts to the FBI about conducting business in Iran through their unofficial subsidiary Skycom, violating U.S. trade sanctions.

Related allegations recently led to the arrest of Huawei’s CFO, Meng Wanzhou, who is accused of lying about the company’s relationship with Iran in multiple presentations to U.S. banks. She is currently under house arrest in Canada (where she was apprehended), and a formal request for her extradition to the U.S. has been made. Her next appearance in court is being held in Vancouver on February 6.

Incentivizing company theft

Huawei allegedly awarded bonuses to their employees for stealing information from rival technology companies.

According to the indictments, a group within the company was assigned the role of assessing information which employees stole, and giving payouts for the most valuable intel.

Stealing from T-Mobile’s “Tappy”

Huawei allegedly instructed U.S.-based employees to steal information on a T-Mobile robot that tested phones, nicknamed “Tappy,” between 2012 and 2014.

At the time, Huawei was reportedly having difficulty developing its own similar technology. The indictments claim employees violated T-Mobile non-disclosure agreements by secretly taking photographs, measurements, and in one reported instance, parts for replication.

What this Means on Both Ends

It’s no secret that the United States has maintained a tense relationship with Huawei over the years, and that both parties have some self-serving biases behind their actions.

Huawei

On one hand, there’s Huawei expressing that it is an innocent employee-owned company without any knowledge of the asserted illegal practices.

Huawei Founder, Ren Zhengfei, even spoke to foreign press for the first time in three years to refute the allegations against his company. He lamented how the U.S. is setting a poor precedent for international business, claiming this action deprives his company of the right to avoid politics and focus on tech and its market.

As usual, despite continued U.S. resistance against Huawei products, the Chinese tech giant doesn’t intend to halt its efforts in expanding overseas.

The United States

On the other hand, there’s the U.S. expressing that it only seeks to defend against foreign espionage and business misconduct.

For years, the U.S. has reported suspicious activity from Huawei. When coupled with U.S. fears of spying from the Chinese government, these combined factors could warrant some valid concerns.

However, it’s also impossible to ignore the U.S.’ obvious self-interest in preventing Huawei’s smartphones from entering the nation’s market, which would undoubtedly create unwanted competition for Apple and Samsung.

The Take-Away

The charges against Huawei are significant. There is no denying this. However, at the same time, it is clear that other forces may be afoot in this entire procedure. The U.S. has a vested interest in telecommunications on a large scale, and there are many players in the room (including Apple and Samsung).

Will things be resolved in the near future? Probably not, especially in light of statements made by the former (as of Sunday) Canadian ambassador to China. This has caused tensions not only to rise between the U.S. and China, but Canada as well.

All anyone can do right now is watch this latest trade war battle as it plays out, and prepare for the many more likely to come.