US Accuses Huawei of Stealing Trade Secrets, Defrauding Banks

An anonymous reader quotes a report from Bloomberg: U.S. prosecutors filed criminal charges against Huawei, China's largest smartphone maker, alleging it stole trade secrets from an American rival and committed bank fraud by violating sanctions against doing business with Iran. Huawei has been the target of a broad U.S. crackdown, including allegations it sold telecommunications equipment that could be used by the China's Communist Party for spying. The charges filed Monday also mark an escalation of tensions between the world's two largest economies, which are mired in a trade war that has roiled markets. In a 13-count indictment in Brooklyn, New York, the government alleged Huawei, two affiliated companies and its chief financial officer of fraud and conspiracy in connection with deals in Iran. A 10-count indictment in Washington state accused the company of stealing trade secrets from T-Mobile and offering bonuses to employees who succeeded in getting technology from rivals.

T-Mobile sued Huawei and its U.S.-based unit, Huawei Device USA Inc., in 2014, and three years later, a federal jury in Seattle found Huawei liable for both breach of contract and misappropriation of trade secrets. A person familiar with the case, who sought anonymity because they weren't authorized to speak, said T-Mobile's claims regarding the theft of its technology caught the attention of federal authorities in the Western District of Washington. T-Mobile said Huawei sent its engineers to T-Mobile's Bellevue, Washington, facility to see a robot, called 'Tappy,' which simulates smartphone use. T-Mobile said in its lawsuit that Huawei was able to use stolen parts from the robot to 'develop, improve and troubleshoot its own robot.' Separately, Huawei CFO Meng Wanzhou was arrested in Canada on allegations that she committed fraud to sidestep sanctions against Iran. 'The U.S., which had requested Canadian authorities arrest Meng, must submit a formal extradition request for her by Jan. 30,' Bloomberg reports. 'Canada's justice minister then has up to 30 days to assess it. If she issues an 'authority to proceed,' that means Canada is officially moving to extradition hearings. If so, they would likely be scheduled months later.'

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