HSBC aware of Huawei’s ties with Iran unit before arrest of founder’s daughter, documents show
Huawei founder Ren was quoted by the Financial Times on July 1 last year as saying that HSBC had known “from the beginning” that a Huawei affiliate called Skycom had business interests in Iran and that the bank “understood Skycom’s relationship with Huawei”.
He said in the FT report that “This can be proven by emails between the bank and Huawei, which have the bank’s logo on them. From a legal perspective, they can’t claim they were deceived or knew nothing, because we have evidence.”
Canadian prosecutors have said that “[Meng’s] misrepresentations put HSBC’s economic interests at risk by preventing the bank from accurately assessing the risks of maintaining a business relationship with Huawei”.
The documents, however, raise questions over the assertion that HSBC was in the dark over Huawei’s ties with Skycom and was solely relying on a presentation by Meng to decide its business relations with the Chinese tech giant.
Meng told the bank that Huawei operates in Iran in compliance with applicable US laws and Skycom was a normal business partner.
At the same time, the key point of the case is whether Meng accurately provided information to HSBC in her August 2013 presentation about Huawei’s relationship with Skycom and activities in Iran, said a source familiar with the matter, who declined to be identified.
According to Meng’s 17-slide PowerPoint presentation dated July 2013 and revealed by the court, she told HSBC that Huawei conducts “normal business activities in Iran … in line with global standards and export control requirements of the US and the EU”.
Meng noted in the presentation that Huawei has sold all its shares in Skycom and she has quit her position on the Skycom board.
The US Department of Justice has alleged that Meng and other Huawei employees “lied” about the company’s relationship with Skycom and failed to disclose that “Skycom was entirely controlled by Huawei”.
As the case caused a worsening in bilateral ties, China arrested two Canadians, Michael Kovrig, a former diplomat, and Michael Spavor, a businessman, on charges of espionage, actions that are widely seen as Beijing’s retaliation against Canada. China’s government has repeatedly requested that Canada release Meng.
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