B.C. judge grants bail for Huawei executive wanted by U.S. over Iran sanctions

VANCOUVER — A top executive at Chinese tech giant Huawei who was arrested in Vancouver has been granted bail.

Meng Wanzhou, 46, is wanted by the United States on allegations that the company skirted trade sanctions against Iran.

Justice William Ehrcke of the Supreme Court of British Columbia said Tuesday he is satisfied Meng, a well-educated businesswomen with letters of reference, does not pose a flight risk. He placed 16 conditions on her release, including that she wear an electronic monitor to track her location.

Meng was arrested on a warrant that alleges she committed fraud because Huawei used unofficial subsidiary Skycom to do business with Iranian telecommunications companies between 2009 and 2014 in violation of international sanctions.

The chief financial officer of Huawei has denied the allegations through her lawyer in court, promising to fight them if she is extradited to face charges in the United States.

Meng’s lawyer, David Martin, found a number of friends and associates to vouch for his client’s character and to offer financial guarantees that she will not flee.

Additional sureties were needed after Ehrcke questioned whether her husband, Liu Xiaozong, could sign a guarantee.

Court heard Liu is living in Vancouver on a six-month visitors visa and Ehrcke said the form to provide a financial guarantee must be provided by a resident of B.C.

John Gibb-Carsley, a federal prosecutor representing the attorney general of Canada, asked the judge to deny Meng’s request for bail, saying she has the financial means to flee and has no connection to Vancouver, despite owning two homes in the city.

Martin said although Liu’s visa is set to expire in February, he has come and gone from Canada over the last 15 years, has a record of compliance and could apply for an extension to stay in the country.

“He’s a rich capitalist, he can do his functions anywhere he is,” said Martin.

Along with the independent sureties, Martin also proposed his client be monitored by a firm that employs former police and military personnel and by another company that monitors people with an electronic bracelet.

Ehrcke said Meng is being held on a provisional warrant and the United States has 60 days to make an extradition request.

Huawei was founded by Meng’s father, Ren Zhengfei. The company has projected 2018 sales of more than US$102 billion and has overtaken Apple in smartphone sales.

The bail hearing began Friday with Gibb-Carsley outlining the allegations against Meng. According to court documents filed by the U.S. Department of Justice, Meng faces “multiple criminal charges” and each charge carries a maximum sentence of 30 years in prison, if she were convicted.

None of the allegations has been proven in court.

Gibb-Carsley said Meng is alleged to have said Huawei and Skycom were separate companies in a meeting with an executive of a financial institution, misleading the executive and putting the institution at risk of financial harm and criminal liability.

Gibb-Carsley said Reuters reported in 2013 that Huawei was operating Skycom and had attempted to import U.S.-manufactured computer equipment into Iran in violation of sanctions. The story caused concern among banks that did international business with Huawei, he said.

Executives, including Meng, then made a series of misrepresentations about the relationship between the two companies to the banks, inducing them to carry out transactions linked to Iran they otherwise would not have completed and which violated sanction laws, he alleged.

The company has said it is not aware of any wrongdoing by Meng and Martin said no charge or indictment has been filed against his client, just a warrant.

Martin said Meng’s 2013 presentation to an executive at HSBC was prepared by numerous employees at Huawei. The presentation did assert that Huawei operates in Iran in strict compliance with applicable laws and sanctions, he said.

Huawei sold its shares in Skycom before the sanctions became law in the United States under president Barack Obama in 2010, he added.

Camille Bains, The Canadian Press