London court kicks out Huawei CFO’s appeal for bank document

London court kicks out Huawei CFO’s appeal for bank documents  

19 February 2021 | Alan Burkitt-Gray

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Huawei’s CFO has lost her court application in London to have bank records used as evidence in her Canadian extradition hearings.

The US wants Meng Wanzhou, who was arrested at Vancouver airport in December 2018, extradited from Canada to the US to be tried for fraud. She wanted the High Court in London to order access to bank documents from HSBC for use in those extradition proceedings.

The judge, Michael Fordham QC, said this morning: “The application is refused.” The case was heard via Microsoft Teams a week ago, with Meng’s lawyers citing the Bankers’ Books Evidence Act of 1879, legislation that treats banks’ records as valid for evidence in trials.

A Huawei spokesperson told Capacity after the judgment, “Huawei is disappointed by today’s court ruling. The pursuit of justice benefits from access to relevant information and clarity of fact. Huawei remains confident in Meng Wanzhou’s innocence and will continue to support her pursuit of justice and freedom.”

At the heart of the case is the US prosecuting authorities’ position in Vancouver, that HSBC was Huawei’s most important international bank with relationships in over 40 countries. US-dollar denominated transactions are required to be processed through the US, whose laws and regulations contain certain prohibitions on banks providing such transactions if related to Iran. HSBC Group cleared US dollar transactions through its US-based subsidiary HSBC US.

Crucially for Meng, a company called Skycom Tech, based in Hong Kong, was used to sell equipment to Iran, contrary to US law — as the equipment included US-originated hardware and software. Reuters revealed in articles published in December 2012 and January 2013 that Skycom, far from being independent, was closely associated with Huawei.

The US is alleging that Meng gave a PowerPoint presentation to HSBC in August 2013 that the US is saying “involved untrue representations” she made about the control of Skycom. The US says Huawei controlled Skycom’s operations in Iran until at least 2014.

But HSBC, says the US, “relied on those and other misrepresentations in deciding to continue the banking relationship with Huawei”.

HSBC “cleared more than $100 million worth of transactions related to Skycom through the United States between 2010 and 2014”, says the US.

Meng, on the other hand, is saying that the US case is “manifestly unreliable” and “deliberately misleading” because the US is “deliberately” withholding or misstating evidence.

She says that the PowerPoint presentation to HSBC contained “no misrepresentation” if its contents are “are fairly considered”.

She also says that people within HSBC “were aware of the relationship” between Huawei and Skycom, “not just at what has been portrayed [by the US] as ‘junior’ level”. HSBC had carried out other inquiries, she is saying, and was not just relying on the PowerPoint.

Meng is saying that the US has access to HSBC’s documents, which include, she says, references to Huawei, Skycom and other companies. Her lawyer, James Lewis QC, told the court in London: “It is clear beyond argument that the United States of America undoubtedly has the relevant documents but will not allow the applicant to have them notwithstanding she needs them for her defence in Canada.”

In a long judgment from Fordham, he appears to take issue with Meng’s position on a number of accounts. First, whether the UK law applies to Canadian proceedings; second whether it applies to wider information a bank has about a customer, rather that accounts, which is implied by the term “bankers’ books”; and whether the London court has the discretion to give Meng access to the records.

With the application refused, Meng will have to pay costs that the judge assessed at £80,000.

Meanwhile, the extradition case itself is due to start in Vancouver in March.