VANCOUVER – An attorney for Huawei’s chief financial officer says there is no evidence that international bank HSBC has suffered an increased risk of loan loss due to Meng Wanzhou’s alleged actions.
Frank Addario made the comment when asking a BC Supreme Court judge to admit new evidence in Meng’s extradition case.
“There was never a risk that the bank would suffer a loss,” Addario said, before receiving the crackdown from the judge and attorney general of Canada.
Meng was arrested at Vancouver Airport in 2018 at the behest of the United States to face fraud charges which she and Huawei deny.
She is accused of distorting Huawei’s control over tech company Skycom in a 2013 presentation to HSBC, putting the bank at risk of violating U.S. sanctions against Iran.
On Monday, the BC Supreme Court began the second in seven weeks of argument in Meng’s case, which culminates in a full-blown extradition or jail hearing in May.
The evidence his team wishes to present is an affidavit from an accountant that details credit facilities and loans issued between 2013 and 2017.
Court documents from Meng’s team describing the proposed evidence indicate that HSBC executed the first loan a week before Meng’s presentation, so they argue that the bank could not have been swayed by it. The following two loans were made to subsidiaries of Huawei, and its lawyers say that suggests they were too far removed from the risks of breaching sanctions.
HSBC was not a lender in connection with the final syndicated loan.
Associate Chief Justice Heather Holmes took issue with Addario’s assessment of why the loans were mentioned by the United States on the record of the case in the first place.
The United States appears to rely on an occasional connection that is “broadly defined” rather than claiming that a particular loan was solicited on the basis of a particular statement that turned out to be false, putting this loan in jeopardy, Holmes said.
“It’s much broader, which is a banking relationship that was continued due to the alleged misrepresentation and therefore all loans made under that banking relationship were at risk,” Holmes said.
Addario replied that he did not think the details of how the loans might be threatened had been “settled”.
Holmes also suggested that the fraud law recognizes the risk inherent in any loan, even when it is repaid.
A lawyer representing the Attorney General of Canada called the proposed evidence “irrelevant” and urged the judge to dismiss it.
Robert Frater argued that the evidence shows that the bank did not lose money on loans, but did not talk about risk.
“The evidence that I would submit is capable of showing that Huawei is not a dead end and that the banks are doing very well,” said Frater.
“Do any of these facts help you on an issue that would be relevant to incarceration?” We say they don’t.
Arguments over the fraud law should be debated at the extradition hearing, but excluding the proposed evidence would not weaken Meng’s argument at this point anyway, Frater said.
Deprivation involves a risk of economic loss and the requesting state does not have to prove the actual loss, he said.
The “most alarming” part of Addario’s submission was that it was the last “scheduled” app to introduce new evidence, rather than the last app, period, he said.
“In our submission, it has no merit, it’s time to move on to engagement,” said Frater.
The court adjourned until Wednesday, when arguments will begin at a crucial stage in the case.
The conduct of Canadian police and border officials will come under court review as Meng’s team begins to argue that his Charter rights were violated during his questioning and arrest at the airport from Vancouver.
They allege that Meng was the victim of abuse of process and that the process should be stayed, while officers testified that they acted appropriately.
This report by The Canadian Press was first published on March 15, 2021.