Meng Wanzhou's lawyers claim U.S. theory of extradition case 'unprecedented in Canadian law'

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Documents released by B.C. Supreme Court May 5 include this picture of Huawei chief financial officer Meng Wanzhou's cancelled U.S. visa. She faces extradition to New York. (B.C. Supreme Court - image credit)
Documents released by B.C. Supreme Court May 5 include this picture of Huawei chief financial officer Meng Wanzhou's cancelled U.S. visa. She faces extradition to New York. (B.C. Supreme Court - image credit)

Lawyers for Meng Wanzhou claim the United States is basing its bid to extradite the Huawei executive to New York on a theory of fraud that's "unprecedented in Canadian law."

In documents released Wednesday, Meng's defence team previewed the arguments it is expected to make this summer during the final phase of her extradition proceedings.

Her lawyers claim American prosecutors are trying to render the 49-year-old to New York to face charges of defrauding HSBC on evidence that's unreliable, and in some cases, just plain wrong.

They also claim the main problem with the Crown's theory of the case is that there is no evidence the bank Meng allegedly tried to trick into doing illegal business with Huawai actually suffered — or even risked suffering — any loss.

"This case is different. On every element of the alleged offence, the [United States'] case displays legal and factual defects rarely seen in fraud cases," the defence submission reads.

"No deception. No loss. Not even a plausible theory of risk. And no causal connection between the impugned representations and the deprivation said to have befallen the putative victim."

Accused of fraud and conspiracy

Meng is Huawei's chief financial officer and the daughter of the Chinese telecommunications company's billionaire founder, Ren Zhengfei.

She was arrested at Vancouver International Airport on Dec. 1, 2018, after arriving on a flight from Hong Kong, en route to Mexico City and a conference in Argentina.

Huawei chief financial officer Meng Wanzhou attends extradition proceedings in downtown Vancouver in March. Her lawyers claim the U.S. has not met the bar for extradition.
Huawei chief financial officer Meng Wanzhou attends extradition proceedings in downtown Vancouver in March. Her lawyers claim the U.S. has not met the bar for extradition.(Ben Nelms/CBC)

Meng is charged with fraud and conspiracy in New York in connection with allegations she lied to an HSBC executive in Hong Kong in 2013 about Huawei's control of a subsidiary named Skycom, which was accused of violating U.S. economic sanctions against Iran.

Prosecutors claim HSBC continued a business relationship with Huawei and agreed to keep moving the company's money through the U.S. financial system because of Meng's alleged misrepresentations.

According to U.S. authorities, HSBC risked breaching the same set of sanctions as a result — placing the bank in danger of prosecution and economic and reputational loss.

The extradition proceedings were originally scheduled to wrap up by mid-May, but, last month, the judge overseeing the case delayed the final three weeks of arguments until August at the request of Meng's lawyers, who said they needed the extra time to pore through reams of newly-released HSBC documents.

'No meaningful risk'

In the submissions released Wednesday, the defence argues Meng did not deny that Skycom was controlled by Huawei. In fact, they claim she said the opposite.

Meng's lawyers also claim HSBC could not have been held criminally liable for sanctions violations committed because of Meng, and that it would be very unlikely for the bank to have faced civil consequences either.

A logo of HSBC is displayed outside a branch in the Central Financial District of Hong Kong in 2015. Meng Wanzhou is accused of lying to one of the bank's executives about Huawei's business activities.
A logo of HSBC is displayed outside a branch in the Central Financial District of Hong Kong in 2015. Meng Wanzhou is accused of lying to one of the bank's executives about Huawei's business activities.(Bobby Yip/Reuters)

They claim senior bank employees were well aware of the truth about Huawei's relationship with its subsidiary prior to — and separate from — anything Meng told them.

The defence concludes by saying that sending Meng to face trial on the kind of record before the court would set a dangerous example.

"In no prior case has an individual been found guilty of fraud for exposing another individual — much less a sophisticated multinational corporate entity — to the hypothetical risk of a separate and future enforcement proceeding," Meng's lawyers write.

"HSBC simply faced no meaningful risk of sanctions violations that were causally linked in any manner to Ms. Meng's representations. Ms. Meng's representations were not inaccurate; but, in any event, HSBC knew what it needed to know in order to protect its own interests."

'Deceitful' representations put bank at risk

Lawyers for Canada's attorney general have also filed the submissions they plan to make in favour of Meng's extradition.

The Crown argues that the record of the case filed by the United States meets the standard that would be needed to send someone to trial in Canada — the establishment of a prima facie case.

Huawei chief financial officer Meng Wanzhou displays her GPS ankle monitoring bracelet as she arrives at B.C. Supreme Court in Vancouver. She is living under a form of house arrest.
Huawei chief financial officer Meng Wanzhou displays her GPS ankle monitoring bracelet as she arrives at B.C. Supreme Court in Vancouver. She is living under a form of house arrest.(Ben Nelms/CBC)

They point out that the extradition judge is not supposed to hold a trial. They also say the evidence submitted by a state in order to request a person's extradition is held to be "presumptively reliable."

The Crown claims the elements of fraud — as laid out in Canadian law — include Meng allegedly lying to deceive HSBC and the bank, risking liability under U.S. sanctions law as a result.

"As the CFO of Huawei and the daughter of its founder, her representations regarding Huawei's business activities undoubtedly carried considerable weight," the Crown's submission reads.

"Ms. Meng's deceitful representations to HSBC about Huawei and Skycom thwarted HSBC's efforts to eliminate its risk exposure, putting HSBC's economic interests at risk."

In addition to arguments on the extradition request, Meng's lawyers will also try to have the case tossed because of alleged abuse of process when the proceedings recommence.

The defence team will argue that the United States misled Canada about the strength of its case and omitted key facts from the record.

They have previously argued that Meng's rights were violated at the time of her arrest, that she's being used as a political pawn and that the entire prosecution is in violation of international law.

Her next court appearance is scheduled for May 7, at which point lawyers are expected to discuss the management of the case in the months ahead.

Meng has denied the allegations against her.

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