Federal Prosecutors Pursuing Huawei as Bipartisan Legislation Gains Momentum Actions Cast Even Greater Doubts on T-Mobile’s Huawei Ties

For Immediate Release: January 16, 2019
Press Contact: Regan Page at regan@npstrategygroup.com

 

Breaking News: Federal Prosecutors Pursuing Huawei as Bipartisan Legislation Gains Momentum

Actions Cast Even Greater Doubts on T-Mobile’s Huawei Ties

 

WASHINGTON, DC – Today, the Wall Street Journal broke that federal prosecutors are pursuing a criminal investigation of telecom giant Huawei for stealing trade secrets from United States business partners — including T-Mobile’s technology.

In addition, Reuters reports a bipartisan group of lawmakers, led by Republicans Senator Tom Cotton and Representative Mike Gallagher and Democrats Senator Van Hollen and Representative Ruben Gallego, introduced legislation that would require President Trump to “ban the export of United States components to any Chinese telecommunications company that violates U.S. sanctions or export control laws.” The new bill specifically cites Huawei and ZTE. The U.S. government has long warned phone companies against using the technologies, and Huawei’s U.S. market evaporated in 2012 after a congressional panel said it was a national security risk.

Senator Cotton wrote: “Huawei is effectively an intelligence-gathering arm of the Chinese Communist Party whose founder and CEO was an engineer for the People’s Liberation Army,” adding, “If Chinese telecom companies like Huawei violate our sanctions or export control laws, they should receive nothing less than the death penalty — which this denial order would provide.”

Meanwhile, the opposition to Huawei just keeps piling on. This past weekend, the Washington Post published a roundup of the countries taking a hard stance against it..

All of this and yet T-Mobile and Sprint remain noticeably silent on the subject. In talks of their proposed merger, the “new T-Mobile” has said absolutely nothing to indicate the company will ban Huawei technology in its projected rollout of 5G infrastructure. T-Mobile, Sprint, and their parent companies, Deutsche Telekom and SoftBank must commit to not using Huawei technology in the U.S and around the world.

KEY POINTS:

  • Federal prosecutors are pursuing a criminal investigation of China’s Huawei Technologies Co. for allegedly stealing trade secrets from U.S. business partners, including the technology behind a robotic device called “Tappy” that T-Mobile US Inc. used to test smartphones, according to people familiar with the matter. [WSJ]
  • U.S. pressure on Huawei has been building. Last month, Canadian authorities arrested Huawei Chief Financial Officer Meng Wanzhou at the request of U.S. authorities. Ms. Meng, the daughter of company founder Ren Zhengfei, is accused of misleading banks about the nature of Huawei’s business in Iran, leading to violations of U.S. sanctions on the country. [WSJ]
  • In another development, Polish authorities last week arrested Huawei executive Wang Weijing and charged him with conducting espionage on behalf of the Chinese government. Huawei wasn’t accused of wrongdoing, and the company on Saturday terminated Mr. Wang’s employment. [WSJ]

 

  • Senator Tom Cotton and Representative Mike Gallagher, both Republicans, along with Senator Chris Van Hollen and Representative Ruben Gallego, both Democrats, introduced the measures, which would require the president to ban the export of U.S. components to any Chinese telecommunications company that violates U.S. sanctions or export control laws. [Reuters]

 

  • The bills specifically cite ZTE and Huawei, both of which are viewed with suspicion in the United States because of fears that their switches and other gear could be used to spy on Americans. Both have also been accused of failing to respect U.S. sanctions on Iran. [Reuters]

 

  • “Huawei is effectively an intelligence-gathering arm of the Chinese Communist Party whose founder and CEO was an engineer for the People’s Liberation Army,” Cotton wrote in a statement. “If Chinese telecom companies like Huawei violate our sanctions or export control laws, they should receive nothing less than the death penalty — which this denial order would provide.” [Reuters]

The Wall Street Journal piece re: criminal investigation is available HERE.

The Reuters piece re: bipartisan legislation is available in full HERE.

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