Huawei CFO Meng Wanzhou leaves Canada after agreement with US over fraud charges

OTTAWA (REUTERS) - Huawei Chief Financial Officer Meng Wanzhou flew home to China on Friday (Sept 24) after reaching an agreement with U.S. prosecutors to end the bank fraud case against her, relieving a point of tension between China and the United States.

Within hours of the news of the deal, two Canadians who were arrested shortly after Meng was taken into custody in December 2018 were released from Chinese jails and were on their way back to Canada. Beijing had denied that their arrests were linked.

The years-long extradition drama has been a central source of discord in increasingly rocky ties between Beijing and Washington, with Chinese officials signaling that the case needed to be dropped to help end a diplomatic stalemate between the world's top two powers.

The deal also opens US President Joe Biden up to criticism from China hawks in Washington who argue his administration is capitulating to China and one of its top companies at the center of a global technology rivalry between the two countries.

Meng was arrested at Vancouver International Airport on a US warrant, and indicted on bank and wire fraud charges for allegedly misleading HSBC in 2013 about the telecommunications equipment giant's business dealings in Iran.

In an exclusive on Friday, Reuters reported that the United States had reached a deferred prosecution agreement with Meng. Nicole Boeckmann, the acting US Attorney in Brooklyn, said that in entering into the agreement, "Meng has taken responsibility for her principal role in perpetrating a scheme to defraud a global financial institution."

The agreement pertains only to Meng, and the US Justice Department said it is preparing for trial against Huawei and looks forward to proving its case in court.

A spokeswoman for Huawei declined to comment. A person familiar with the matter said Meng - the daughter of Huawei founder, Ren Zhengfei had left Canada on a flight to Shenzhen.

The two Canadians, businessman Michael Spavor and former diplomat Michael Kovrig, had been held in China for more than 1,000 days. In August, a Chinese court sentenced Spavor to 11 years in prison for espionage.

Prime Minister Justin Trudeau told reporters in brief remarks late on Friday the two men had left Chinese airspace just minutes before. He was not asked whether the two countries had struck a bilateral deal.

"I want to thank our allies and partners around the world in the international community who have stood steadfast in solidarity with Canada and with these two Canadians," he said.

At a hearing in Brooklyn federal court on Friday, which Meng attended virtually from Canada, Assistant US Attorney David Kessler said the government would move to dismiss the charges against her if she complies with all of her obligations under the agreement, which ends in December 2022. He added that Meng will be released on a personal recognizance bond, and that the United States plans to withdraw its request to Canada for her extradition.

Meng pleaded not guilty to the charges in the hearing. When U.S. District Court Judge Ann Donnelly later accepted the deferred prosecution agreement, Meng sighed audibly.

A Canadian judge later signed Meng's order of discharge, vacating her bail conditions and allowing her to go free after nearly three years of house arrest. She was emotional after the judge's order, hugging and thanking her lawyers. Speaking to supporters and reporters on the steps of the court afterward, Meng thanked the judge for her "fairness" and talked of how the case had turned her life "upside down".

Meng was confined to her expensive Vancouver home at night and monitored 24/7 by private security that she paid for as part of her bail agreement. Referred to by Chinese state media as the "Princess of Huawei," she was required to wear an electronic ankle bracelet to monitor her movements, which became fodder for the tabloids when it hung above her designer shoes.