- The Department of Justice (DOJ) charged Chinese telecom company Huawei with conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act (RICO).
- The Trump administration has pursued charges against Huawei for close to a year now, as geopolitical tensions between the US and Huawei’s home country China continue to rise.
- The latest indictment includes information alleging Huawei tried to steal trade secrets from six different US technology companies and “made repeated misstatements to U.S. officials, including FBI agents and representatives from the U.S. House Permanent Select Committee on Intelligence, regarding their efforts to misappropriate trade secrets.”
- It also alleges the company concealed its involvement with business and technology projects in Iran and North Korea using the code names “A2” and “A9.”
- Huawei denied the DOJ’s allegations: “The government will not prevail on these charges which we will prove to be both unfounded and unfair.”
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Chinese telecommunications company Huawei and its CFO Meng Wanzhou will be charged with 16 counts of conspiracy and racketeering, the Department of Justice (DOJ) announced Thursday.
A new superseding indictment filed in federal court said the company violated the Racketeer Influenced and Corrupt Organizations Act (RICO), and included new charges alleging Huawei’s theft of trade secrets from American technology companies.
The US accused Huawei of breaching confidential agreements with American technology companies after gaining access to their intellectual property. Huawei had a bonus program that rewarded employees who obtained confidential information from their competitors, and rewarded them, the Department of Justice alleged.
“As part of the scheme, Huawei allegedly launched a policy instituting a bonus program to reward employees who obtained confidential information from competitors,” the DOJ wrote in a press release announcing the charges. “The policy made clear that employees who provided valuable information were to be financially rewarded.”
The DOJ also detailed new allegations against Huawei and its subsidiaries, accusing them of concealing their business in countries under US, EU and UN sanctions. For instance, the indictment alleges that Huawei used code names “A2” and “A9” in internal documents to refer to business in Iran and North Korea.
“When confronted with evidence of wrongdoing, the defendants allegedly made repeated misstatements to U.S. officials, including FBI agents and representatives from the U.S. House Permanent Select Committee on Intelligence, regarding their efforts to misappropriate trade secrets,” wrote the DOJ.
Huawei denied the DOJ’s allegations and told Business Insider that the charges were repackaged from 20-year-old civic allegations, brought against it to stifle competition.
“The ‘racketeering enterprise’ that the government charged today is nothing more than a contrived repackaging of a handful of civil allegations that are almost 20 years old and that have never been the basis of any significant monetary judgment against Huawei,” a statement from Huawei said. ” The government will not prevail on these charges which we will prove to be both unfounded and unfair.”
The Trump administration has pursued charges against Huawei for close to a year now, as geopolitical tensions between the US and Huawei’s home country China continue to rise. The company was put on a US blacklist back in May, preventing it from doing business with other US companies without government approval. And Huawei CFO Meng Wanzhou is facing extradition proceedings in Canada after being arrested in December 2018 on charges of covering up Huawei’s links to selling equipment to Iran.
The latest indictment follows the US government’s accusation that Huawei spied on people by exploiting telecom “back doors,” intended for use by law enforcement.