The Justice Department has added new criminal charges against Chinese tech giant Huawei and several subsidiaries, accusing the company of a brazen scheme to steal trade secrets from competitors in America, federal prosecutors announced Thursday.
The new indictment also alleges the company provided surveillance equipment to Iran that enabled the monitoring of protesters during 2009 anti-government demonstrations in Tehran, and that it sought to conceal business that it was doing in North Korea despite economic sanctions there.
The company issued a statement Thursday evening disputing the allegations and calling them “without merit."
The new allegations come as the Trump administration raises national security concerns about Huawei, the world's largest telecommunications equipment manufacturer, and aggressively lobbies Western allies to bar the company from wireless, high-speed networks.
The superseding indictment, brought by federal prosecutors in Brooklyn, adds to the company's legal woes in the U.S. It adds charges of racketeering conspiracy and conspiracy to steal trade secrets to an existing criminal case in New York, where the company already faces charges of lying to banks about deals that violated economic sanctions against Iran.
The latest indictment, an update of a case first filed last year, accuses Huawei of plotting to steal the trade secrets and intellectual property of rival companies in the U.S.
In some instances, prosecutors said, Huawei recruited employees of competitors to steal intellectual property. The company also provided incentives to its own employees by offering bonuses to those who brought in the most valuable stolen information, and it used proxies, including professors at research institutions, in the pursuit of inside information, prosecutors said.
The stolen information included antenna and robot testing technology as well as user manuals for internet routers. One goal of the theft, the Justice Department said, was to allow Huawei to save on research and development costs.
The indictment details efforts to steal from a half dozen companies.
In one May 2013 episode, according to the indictment, a Huawei engineer removed a robot arm from the laboratory of a rival company based in Washington state, stashing the item in a laptop bag. The engineer emailed photographs and measurements of the arm to others at Huawei before th arm was returned to the company, which had discovered the theft.
At a 2004 trade show in Chicago, a Huawei employee was found in the middle of the night in the booth of a technology company, “removing the cover from a networking device and taking photographs of the circuitry inside," prosecutors said. The employee wore a badge that listed his employer as “Weihua," or Huawei spelled with its syllables reversed.
In a statement, Huawei called the new indictment “part of the Justice Department’s attempt to irrevocably damage Huawei’s reputation and its business for reasons related to competition rather than law enforcement.”
“These new charges are without merit and are based largely on recycled civil disputes from last 20 years that have been previously settled, litigated and in some cases, rejected by federal judges and juries," it said. “The government will not prevail on its charges, which we will prove to be both unfounded and unfair.”
Trump administration officials, including Cabinet secretaries, have recently leveled national security allegations against Huawei in an effort to encourage European nations to ban the gear from next-generation cellular networks. Amidst all this, the UK government has given Huawei the permission to operate and test its 5G technology solution for network setting up in the region.
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