US accuses Huawei of stealing technology from six companies

US prosecutors have alleged that Huawei is a criminal enterprise, accusing the Chinese group of stealing technology from a host of US companies, violating sanctions and making false statements to the FBI.

The US justice department on Thursday added several new charges to its criminal case against Huawei, including racketeering, fraud, breaching sanctions against North Korea and fresh allegations of trade theft.

The charges are the latest move by the Trump administration against the Chinese company, which it accuses of systematically breaking US laws on its path to becoming the global market leader in telecoms equipment.

It comes as other countries, including Germany, deliberate on whether to allow Huawei to supply their 5G mobile network equipment, having been warned by Washington that such kit could be used by Beijing for spying.

The US itself has banned US companies from selling equipment to Huawei without a licence, albeit with some exemptions. It extended one of those exemptions on Thursday, allowing American companies to continue supplying parts to maintain old networks, though only for the next 45 days — half the length of previous such extensions.

The DoJ said in a statement: “The new charges in this case relate to the alleged decades-long efforts by Huawei, and several of its subsidiaries, both in the US and in the People’s Republic of China, to misappropriate intellectual property, including from six US technology companies, in an effort to grow and operate Huawei’s business.”

The department added: “Huawei, Huawei USA and Futurewei agreed to reinvest the proceeds of this alleged racketeering activity in Huawei’s worldwide business, including in the United States.”

The US first announced charges against Huawei a year ago, accusing it of stealing technology from T-Mobile, the US telecoms company, and of violating sanctions against Iran. The DoJ also accused Meng Wanzhou, the company’s chief financial officer and daughter of the founder Ren Zhengfei, of making false statements about the company’s business dealings in Iran.

Ms Meng is currently in Vancouver as she fights an extradition request from the US. She denies wrongdoing.

In the new charges unveiled Thursday, the US accused the company of stealing technology from five other companies since 2000, describing it as a “pattern of racketeering activity”.

It added that the company hid business dealings in North Korea, which it referred to in internal communications by the code “A9”.

The US also alleged that senior Huawei executives made false statements to the FBI, including an “Individual-1”, referred to at one point as “the founder of Huawei”.

The indictment says that in an interview in 2007, Individual-1 falsely told FBI agents in New York that Huawei complied with all US sanctions laws and that it had won a lawsuit against an unnamed company over accusations of technology theft.

The DoJ would not say whether Individual-1 referred to Mr Ren and it was not immediately clear whether it was a reference to him. It did not comment on the identity of the five companies involved.

From public information, however, the details of the technology theft accusations appear to correlate to previous allegations lodged by well-known US technology companies.

The US alleges, for example, that starting in 2000, Huawei stole source code for internet routers from “Company 1”. Cisco took the Chinese company to court in 2003 for doing exactly that, in a lawsuit which the US company eventually dropped. Cisco declined to comment on the latest DoJ charges.

Huawei has said it received the source code from a third party, and that it was openly available on the internet. Cisco continues to dispute that.

In another accusation, US officials detail how a Huawei employee was discovered, during a trade show in 2004 in Chicago, going to a rival company’s booth in the middle of the night and taking photographs of the circuitry inside a networking device. This individual wore a badge listing his employer as “Weihua”, according to the charge.

The details of the accusation fit those previously published in The Wall Street Journal of a Huawei employee being discovered at a 2004 trade show with a notebook containing diagrams and data belonging to AT&T, the US telecoms company. AT&T did not respond to a request to comment.

Huawei said at the time the incident was an “unfortunate misunderstanding”.

Huawei has previously denied the charges lodged last year. It declined to comment on the latest charges.

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