For the past couple of years, the United States has been investigating allegations that Huawei shipped American-made products to Iran. The why of the matter is that having Iran get their mitts on US goods is a violation of the trade sanctions that the United States government imposed on the middle eastern nation.
The Justice Department Investigation into Huawei was kept quiet until The Wall Street Journal broke the news on it this past April. From the looks of things, investigators must have come up with some pretty solid dirt as Canadian law enforcement officials arrested one of Huawei's highest ranking officers, earlier this week:
From The Globe and Mail:
Canada has arrested the chief financial officer of China's Huawei Technologies who is facing extradition to the United States on suspicion she violated U.S. trade sanctions against Iran.
Wanzhou Meng, who is also the deputy chair of Huawei's board and the daughter of company founder Ren Zhengfei, was arrested in Vancouver at the request of U.S. authorities.
"Wanzhou Meng was arrested in Vancouver on December 1. She is sought for extradition by the United States, and a bail hearing has been set for Friday," Justice department Ian McLeod said in a statement to The Globe and Mail. "As there is a publication ban in effect, we cannot provide any further detail at this time. The ban was sought by Ms. Meng.
Ms. Meng, a rising star at Shenzhen-based Huawei, now the world's second-largest maker of telecommunications equipment. Reuters reported in 2013 that Ms. Meng served on the board of a Hong Kong-based Skycom Tech Co. Ltd. that later attempted to sell embargoed Hewitt Packard computer equipment to Iran's largest mobile-phone operator.
At least 13 pages of the Skycom proposal were marked "Huawei confidential" and carried Huawei's logo. Huawei has said neither it nor Skycom ultimately provided the HP equipment; HP said it prohibits the sale of its products to Iran.
The arrest and extradition of Meng into the loving arms of Justice Department investigators is the latest move against Huawei, by the United States and Canada. Last March, CSIS and the RCMP warned Canadian businesses against relying on technology developed by Huawei and other companies owned wholly or in part by foreign governments. The reasoning: the hardware could be used as a conduit for that nation–China, if we're talking about Huawei–to conduct industrial espionage. It's a sentiment that has been echoed by the United States government for some time.