Huawei was dealt a blow a couple of days back when its Chief Financial Officer (CFO), Meng Wanzhou, was arrested in Canada for fraud and violating US sanctions against Iran. To be precise, accusations towards Wanzhou began with a Hong Kong-based company known as Skycom Tech.
According to Canadian officials, Huawei had allegedly used Skycom as an unofficial subsidiary to the Chinese giant. Through Skycom, Huawei has reportedly circumvented US sanctions against Iran. Channeling money from US banks directly to Skycom Tech; a branch of the company located in Iran.
While Wanzhou is still awaiting extradition to the US to face a judge, it’s been suggested that the Chinese CFO could face multiple sentences – each with a maximum of 30 years – if convicted. As you would expect, Huawei’s stock value also took a plunge after news of Wanzhou’s arrest broke.
Needless to say, this isn’t the first time that Huawei has gotten itself into hot water with the US government. Earlier in the year, Huawei were banned from selling any and all of their smartphones to US military base retailers. Then, just a couple of weeks ago, the country’s administration began urging several of its key allies to refrain from using any of the Chinese brand’s electronics equipment.