Exclusive: New documents link Huawei to suspected front companies in Iran, Syria

The U.S. case against the chief financial officer of China’s Huawei Technologies, who was arrested in Canada last month, centers on the company’s suspected ties to two obscure companies. One is a telecom equipment seller that operated in Tehran; the other is that firm’s owner, a holding company registered in Mauritius.

U.S. authorities allege CFO Meng Wanzhou deceived international banks into clearing transactions with Iran by claiming the two companies were independent of Huawei, when in fact Huawei controlled them. Huawei has maintained the two are independent: equipment seller Skycom Tech Co Ltd and shell company Canicula Holdings Ltd.

But corporate filings and other documents found by Reuters in Iran and Syria show that Huawei, the world’s largest supplier of telecommunications network equipment, is more closely linked to both firms than previously known.

The documents reveal that a high-level Huawei executive appears to have been appointed Skycom’s Iran manager. They also show that at least three Chinese-named individuals had signing rights for both Huawei and Skycom bank accounts in Iran. Reuters also discovered that a Middle Eastern lawyer said Huawei conducted operations in Syria through Canicula.

The previously unreported ties between Huawei and the two companies could bear on the U.S. case against Meng, who is the daughter of Huawei founder Ren Zhengfei, by further undermining Huawei’s claims that Skycom was merely an arms-length business partner.

Huawei, U.S. authorities assert, retained control of Skycom, using it to sell telecom equipment to Iran and move money out via the international banking system. As a result of the deception, U.S. authorities say, banks unwittingly cleared hundreds of millions of dollars of transactions that potentially violated economic sanctions Washington had in place at the time against doing business with Iran.

Articles published by Reuters in 2012 here and 2013 here about Huawei, Skycom and Meng figure prominently in the U.S. case against her. Reuters reported that Skycom had offered to sell at least 1.3 million euros worth of embargoed Hewlett-Packard computer equipment to Iran's largest mobile-phone operator in 2010. At least 13 pages of the proposal were marked "Huawei confidential" and carried Huawei's logo. Huawei has said neither it nor Skycom ultimately provided the U.S. equipment.

Reuters also reported numerous financial and personnel links between Huawei and Skycom, including that Meng had served on Skycom’s board of directors between February 2008 and April 2009.

Several banks questioned Huawei about the Reuters articles, according to court documents filed by Canadian authorities at the request of the U.S. for Meng’s bail hearing in Vancouver last month.

According to the documents, U.S. investigators allege that in responding to the banks, which weren’t named, Meng and other Huawei employees “repeatedly lied” about the company’s relationship with Skycom and failed to disclose that “Skycom was entirely controlled by Huawei.” U.S. authorities also allege that at a private meeting with a bank executive, in or about August 2013, Meng said Huawei had sold its shares in Skycom, but didn’t disclose that the buyer was “a company also controlled by Huawei.”

The court documents allege that Huawei told the executive’s bank that the Chinese company had sold its shares in Skycom in 2009 - the same year Meng stepped down from Skycom’s board. Skycom’s buyer wasn’t identified in the documents.

JUNE 5, 2018 : (RON HANSEN IS ARRESTED -— See DIA, CHINA, ESPIONAGE/SPIES/SPOOKS)
Ron Rockwell Hansen, a DIA operations officer until 2006, was arrested June 5 and pleaded guilty on Friday in Utah to attempting to sell national defense secrets to China. He faces 15 years in prison under a plea deal. Sentencing is set for Sept. 24. —— “Former DIA Officer Who Spied for China Hated Trump, Court documents reveal Chinese intelligence targets ,” Free Beacon, March 20, 2019 4:59 am | Bill Gertz

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