Huawei CFO and daughter of founder Ren Zhengfei, Meng Wanzhou, will face extradition proceedings in Canada at the request of the U.S. government starting January 20 of next year, Bloomberg reports. The process could be drawn out to at least October. The executive potentially faces charges of fraud in the U.S. over allegations that she had provided false information to banks in such a way as to cause them to violate sanctions the country has imposed on dealings with Iran.
The protracted battle continues
Meng Wenzhou has been held in Canada since December when she was arrested while at an airport in the country. The executive has been on house arrest in the interim, after posting a hefty $6.5 million USD bail and surrendering her passports.
The company has repeatedly called for its CFO's release in the meantime, claiming that the arrest and proceedings are a farce being perpetrated with primarily political motivations. It has further claimed that Canada unlawfully detained Ms. Meng since no crimes would have been committed in Canada or against Canadian banks.
If convicted, the 46-year-old could face as many as 30 years in prison in the States.
Among more recent circumstances surrounding the case, Ms. Meng's U.S.-based counsel has faced accusations that his position as her attorney may be compromised due to conflicts of interest. The long-term lawyer, James Cole held a prior position with the U.S. Department of Justice which may lead to his dismissal from the case.
Back and forth over those allegations has likely played a significant role in the extended expected time frame for the extradition proceedings. Mr. Cole and Huawei have contested the accusations.
A drop in an ocean of trouble for Huawei
Regardless of the outcome of this court case, Huawei arguably has much larger problems for now, which will almost certainly keep the bulk of the company's attention elsewhere. Over the past couple of months, the company has faced increasing scrutiny from the U.S.
That has largely centered around allegations that its mobile networking equipment can or is being used to spy for the Chinese government, in the midst of an ongoing trade war. Those have culminated in the popular OEM being placed on "entity" list in the country by President Donald Trump.
The move effectively places the company on a watch list, preventing its ability to do business with the U.S. or companies in the region, pending its ability to follow U.S.-set guidelines via an FTC-granted temporary reprieve. Other businesses and certifications boards around the globe have subsequently ended partnerships with Huawei, forcing the company to look inward for solutions that will keep its mobile and network operating equipment businesses alive.
To that end, Huawei has substantially ramped up its efforts to develop and build its own mobile operating system, apps ecosystem, and hardware, lightening the degree to which American companies impact its supply chain and operations.
While defending its CFO is undoubtedly a top priority, Huawei's trouble within its smartphone business — now the second largest on the planet — is effectively a real existential threat.