Washington accuses Huawei of racketeering

U.S. prosecutors have accused Huawei of racketeering, planning to steal trade secrets and assisting Iran.

Karen Freifeld reported the news for Reuters:

U.S. prosecutors on Thursday accused Huawei of stealing trade secrets and helping Iran track protesters in its latest indictment against the Chinese company, escalating the U.S. battle with the world’s largest telecommunications equipment maker.

In the indictment, which supersedes one unsealed last year in federal court in Brooklyn, New York, Huawei Technologies Co was charged with conspiring to steal trade secrets from six U.S. technology companies and to violate a racketeering law typically used to combat organized crime.

It also contains new allegations about the company’s involvement in countries subject to sanctions. Among other accusations, it says Huawei installed surveillance equipment in Iran that was used to monitor, identify, and detain protesters during the 2009 anti-government demonstrations in Tehran.

Saheli Roy Choudhury wrote for CNBC:

Chinese tech giant Huawei said new charges brought against the company by the U.S. Department of Justice were without merit and were part of an attempt to “irrevocably damage Huawei’s reputation and its business.”

Federal prosecutors announced Thursday new criminal charges against Huawei and two of its U.S. subsidiaries, which included racketeering conspiracy charges and a charge of plotting to steal trade secrets from American companies.

Huawei also allegedly assisted Iran’s government in domestic surveillance during the 2009 demonstrations in Tehran and tried to conceal the scope of its business in North Korea, according to the indictment.

The superseding indictment, announced in federal court in Brooklyn, New York, adds to previous charges filed against Huawei. The earlier charges, unsealed last January, alleged the company lied to banks, committed wire fraud and violated economic sanctions against Iran, and Huawei pleaded not guilty to those charges.

Merrit Kennedy from NPR reported:

Sens. Richard Burr, R-N.C., and Mark Warner, D-Va., said in a joint statement that the indictment “paints a damning portrait of an illegitimate organization that lacks any regard for the law.”

Huawei is also accused of doing business in countries subject to U.S. sanctions such as North Korea and Iran. Prosecutors accuse Huawei of helping Iran’s government “by installing surveillance equipment, including surveillance equipment used to monitor, identify and detain protesters during the anti-government demonstrations of 2009 in Tehran, Iran.”

They say that for decades, Huawei has worked to “misappropriate intellectual property, including from six U.S. technology companies, in an effort to grow and operate Huawei’s business.”

Huawei allegedly pushed its employees to bring in confidential information from competitors, even offering bonuses for the “most valuable stolen information,” according to the indictment.

The 56-page indictment is rife with examples of Huawei scheming to obtain trade secrets from U.S. companies. They also allegedly attempted to recruit employees from rival companies or would use proxies such as professors working at research institutions to access intellectual property.