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Home » News » Huawei is Being Charged With Racketeering by the US

Huawei is Being Charged With Racketeering by the US

huawei charged racketeering

In February of 2020, the US Department of Justice (DoJ) and the FBI brought 15 charges against Huawei and some of its US subsidiaries for conspiracy to steal trade secrets, misappropriate intellectual property, and grow their business.

Concerns with Huawei: Background

The Chinese telecom giant, Huawei has been under scrutiny for over a year with a number of countries banning the use of its networking opportunities. Concerns relating to Huawei stems from its connections with the Chinese government, leading to the fear that its equipment may be used for spying purposes. The US, specifically, banned the use of the company’s networking equipment in 2012. In 2019, President Trump banned Huawei from US communication networks.

What’s Happening Now?

Today, the company is being charged with conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act (RICO) statute. The statute states that: “It is unlawful for anyone employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity or collection of unlawful debt.”

The charge comes as a result of the allegation that Huawei stole source code for “Company 1’s” routers which was then used in Huawei’s products. Based on the context, it is highly probable that “Company 1” is Cisco, the tech company headquartered in California. Check out the official indictment here.

Furthermore, the DoJ alleges that the telecom company used confidential agreements made with American companies to access trade secrets. These secrets were then used to fund the company. The DoJO also alleges that Huawei used code words and selective local partners to protect its activities. And so, it has also been charged for its connections to such activities in Iran and North Korea.

Among the defendants is Huawei CFO, Meng Wanzhou, who has been charged with fraud and placed under house arrest in Canada. Other defendants include Huawei Technologies Co. Ltd., Huawei Device Co. Ltd., Huawei Device USA Inc., Futurewei Technologies Inc., and Skycom Tech Co. Ltd.

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