The investment banking company HSBC has framed Huawei CFO Meng Wanzhou by fabricating evidence for its own interests, said some legal experts, who cast doubt on the authenticity of the bank’s claims concerning key evidence in Meng’s case.
It has been almost 20 months since her arrest in Canada for alleged crimes of bank fraud, and the Supreme Court of British Columbia, Canada heard arguments on Monday based on claims of privileges over documents requested by lawyers representing Meng in her extradition case.
HSBC has emerged as a key player in the case as it submitted evidence early on that included a meeting between Meng and a senior executive from HSBC at a restaurant back in 2013.
On August 22, 2013, Meng met with Alan Thomas, HSBC’s then deputy head of global banking for the Asia Pacific region, in a restaurant in Hong Kong. During that meeting, Meng made a PowerPoint presentation about Huawei’s business links in Iran through a company called Skycom and Huawei’s efforts in compliance with U.S. sanctions.
Some five years later, that presentation became key evidence in a U.S. extradition case against her, alleging that she committed fraud against HSBC and other banks, exposing them to “both economic and reputational” risks.
“We believe she is innocent and hope she will regain her freedom as soon as possible. But as her legal case is still ongoing, I am sorry I cannot make more comments about the case itself,” said Song Liuping, Huawei’s chief legal officer and chief compliance officer.
Meng is the CFO of Huawei, not the chief legal or compliance officer. It would make sense for her to talk to HSBC, but compliance matters are not under her portfolio, and by the time the presentation was made, she had no direct relationship with Skycom.
Meng told Thomas that Skycom was a business partner of Huawei in Iran. She also explained how his business activities in that country and its trade compliance program related to U.S. sanctions. HSBC still allegedly decided to retain Huawei as a customer based on her presentation.
A year before the meeting with Meng, U.S. prosecutors had charged HSBC with four crimes, including money laundering in Mexico that involved at least 880 million U.S. dollars. The bank was fined 1.9 billion U.S. dollars and had to sign a five-year Deferred Prosecution Agreement (DPA) to self-rectify and cooperate with judicial investigations. This was the third time in a decade that HSBC had been punished for similar offenses.
“In the Anglo-Saxon legal system, there is what we call (plea)-bargaining (system). That means for HSBC certainly it realizes that it did something wrong. However, in order to reduce the responsibility, it should be held, and then it preferred to do something as a deal with the U.S. prosecutions, so that is quite possible,” said Zhu Wenqi, a professor of international law from the Renmin University of China.
U.S. prosecutors accused Meng of lying in order to attain financial services from HSBC. According to new evidence provided by Huawei, HSBC and its senior management were aware of Huawei’s business activities in Iran through Skycom, and it shows the bank had known the risks associated with servicing Skycom.
“We could see HSBC had closed the Skycom account. From this fact, we could see the bank should have known both Huawei and Skycom were their own customers. The evidence provided by HSBC also proved this point,” said Armstrong Chen, a senior partner of Dentons China.
“Meng Wanzhou is not inside a secret head had been on the board of directors of Skycom. And so there wasn’t any bad activities or bad mind on her part, because that’s a matter of public recognition, which the bank would have known about previously,” said Edward Lehman, a U.S. lawyer.
The relationship between Huawei and Meng with Skycom was outlined in the PowerPoint; however, that piece of information was left out in the summary by U.S. prosecutors provided to the Canadian courts.
HSBC’s compliance history has not been a perfect one. From 2006 to 2010, for instance, HSBC bank USA failed to implement an anti-money laundering program capable of adequately monitoring suspicious transactions and activities from HSBC Group Affiliates, particularly HSBC Mexico. As a result, at least 881 million U.S. dollars in drug trafficking proceeds were laundered through the system.
In December 2012, the U.S. Department of Justice announced enforcement actions on HSBC, and a deferred prosecution agreement was signed between the two sides. HSBC committed to improve compliance and cooperate fully with investigators. A compliance monitor was also appointed to the bank.
According to the Wall Street Journal, the monitor’s 2016 annual report to the Department of Justice found instances of potential financial crime and questioned whether HSBC was meeting all of its DPA obligations.
In late 2016, HSBC began to conduct an internal probe of Huawei.
In February 2017, U.S. Departments of Treasury, Commerce, Homeland Security and Justice, reportedly gathered in Washington D.C. to talk about how they would move forward against Huawei.
It’s reported that sometime later, HSBC helped authorities obtain evidence of links between Skycom and Huawei, which included the PowerPoint.
The PowerPoint presentation became the key piece of evidence of U.S. indictment of fraud against Meng. They alleged she made misrepresentations about the company’s links in Iran and compliance issues exposing HSBC to risks. But when submitting the PowerPoint as evidence to a Canadian court, an important part was left out, the part about Huawei’s efforts to comply with U.S. sanctions.
In an interview in June 2018, U.S. Commerce Secretary Wilbur Ross confirmed that Huawei was in compliance. However, eight months later, the U.S. made a completely different assessment and announced the U.S. charges against Huawei and Meng.
“Obviously, this came from the very top. You have the statement by Donald Trump, saying that this is a card that he intended to use in his trade negotiations,” said Einar Tangen, former U.S. prosecutor.
“Is this politically motivated? I mean, someone objective would say, might say, yes. I mean, this has been intended death path to Huawei in the United States. This is a great way to get rid of competition,” said Lehman.
“This is not a game of Go Fish, right? The idea that we are supposedly civilized, more civilized than we are today than we were in the past. How is that possible when in essence, he’s kidnapped her? All right, he is holding her for ransom against her father and the Chinese government and her own liberty for his own political gains,” said Tangen.
Spouse witnessed N.S. gunman torching their cottage, court documents say – CBC.ca
The man responsible for April’s mass shootings in Nova Scotia took a leisurely drive around a community close to his rural cottage, stopped to chat with a fellow denturist and oversaw work being done on his property in the hours before the massacre began.
The details of a seemingly mundane day leading up to the shootings are contained in sections of court records that a provincial court judge ordered released Monday following a court hearing.
The documents also say that on the evening of April 18, the gunman’s spouse was present inside as he doused the floor of the cottage they shared with gasoline — before grabbing guns and igniting the log building he’d prized. The woman, whose name is redacted from the records, later told police he said, “I’m done, I’m done. It’s too late [redacted], I’m done.”
On April 18 and 19, Gabriel Wortman killed 22 neighbours, acquaintances and strangers in several communities in rural Nova Scotia. He torched his own cottage and garage, and three other homes over a 13-hour period before being shot dead by police at a gas station in Enfield, N.S. after a lengthy search.
A judge on Monday approved the release of six more of the approximately 23 judicial authorizations RCMP have obtained since the massacre — to search gunman’s properties in Portapique and Dartmouth, and for his financial records. Redacted copies of seven were previously released.
Though the new documents are heavily redacted, each is about 90 pages long and includes information about how the gunman procured decommissioned RCMP cruisers and police equipment and about his financial transactions months prior to the attacks. All information related to the type of firearms used remains blacked out.
Expected to head to Dartmouth
It’s unclear why the gunman “snapped,” as his spouse described it to police. The documents also offer little information about why Wortman targeted his victims, some of whom he knew. His partner told police she did not know their neighbours well.
She also told police that, that night, she believed he was going to take her to Dartmouth, where they had another home and a clinic, to kill people or burn buildings, according to the documents. The specifics are blacked out. The woman has never spoken publicly about what she saw on April 18. Her lawyer has declined requests for comment from CBC News.
At some point after Wortman loaded guns and ammunition into his mock cruiser, the woman escaped. She told investigators she initially hid in a truck before spending hours in a wooded area in Portapique. Though she heard someone announcing they were police on a loudspeaker, she said she feared it was her partner. Around dawn she went to the home of a neighbour who called 911.
Large cash withdrawal
RCMP have previously said Wortman liquidated his assets and stockpiled gas and food due to COVID-19 fears. A warrant that the court released in May revealed people told the investigators the gunman was paranoid and had a history of abuse.
According to the new documents, his spouse also told police in the weeks prior to the attacks he was “consumed” by the pandemic, talking about it constantly and saying he “knew he was going to die.”
She also said he feared that Prime Minister Justin Trudeau would find a way to control money and that prompted him to withdraw nearly half a million dollars from his own accounts. The RCMP interviewed officials from CIBC and Brinks about a March 30 withdrawal in Dartmouth.
Officials from the bank told police that Wortman asked to liquidate investments and then transferred the money to his business accounts. On March 25 at a branch in Dartmouth, he asked the bank’s director that his $475,000 be paid out in $100 bills, according to the court documents.
The records state the bank worked with Brinks to set up a pick-up on March 30.
RCMP have not said how much cash police have recovered. The search warrant documents show that on April 22, investigators found cash folded in tinfoil packets inside an ammunition box discovered at the Portapique property.
Suspicious transactions flagged
Canada’s money-laundering watchdog, the Financial Transactions and Reports Analysis Centre (Fintrac), reported on Wortman’s personal and professional financial activities after the massacre, according to the newly released documents.
The records say Wortman’s PayPal account was used to buy vehicle accessories labelled as being for police use on eBay. The court documents describe the purchases as “for items utilized in the facilitation of domestic terrorist activities.”
According to the court documents, the Fintrac review found that PayPal flagged suspicious transactions between March 22 and Dec. 5, 2019 — though it’s not clear from the records if that’s when they were reported as suspicious or if that’s when they occurred.
Those purchases included accessories for police vehicles such as:
- A centre console for a 2013 Ford Taurus.
- A ram for the front bumper of a Taurus sedan.
- Siren lights.
- A dashcam.
- Thin blue line vinyl decal.
- A gun rack.
Other transactions listed as suspicious include $15,045 worth of items — including decommissioned cars — purchased with credit cards from GCSurplus in Ottawa. The site is run by Public Services and Procurement Canada.
There’s also reference to cash deposits payable to Wortman from Northumberland Investments, one of his companies. The Fintrac review found three questionable transactions: two cash deposits in 2010 totalling $200,000 and another for $246,000. The transactions happened in Fredericton and Dartmouth, but the documents don’t elaborate on the circumstances.
What is clear is that over the years, people around the gunman knew he had a penchant for acquiring car parts and collecting motorcycles. Some also knew he had guns and one car that he’d outfitted to resemble an actual cruiser.
The documents reference interviews with two people who responded to a Kijiji ad about an off-road vehicle in the weeks prior to April’s attacks. In both cases, Wortman showed off his replica cruiser inside the large garage he had in Portapique.
Using one of his companies, he purchased the 2017 Ford Taurus used in the attacks on July 3, 2019, from the RCMP, according to the search warrant records.
A friend of Aaron Tuck, who was one of Wortman’s victims, told police that in August 2019, Tuck told him that Wortman’s mock cruiser was indistinguishable from an actual police vehicle and that he kept a holster for a gun in the back of it. Tuck was killed alongside his wife, Jolene Oliver, and his daughter, Emily, at their home in Portapique.
Peter Griffon, a neighbour who was on parole and who printed the decals for the cruiser, initially lied to police about his involvement but later showed investigators images of the vehicle he kept on his phone. He did odd jobs for Wortman and on April 18 had been splitting wood for him. He last saw him around noon that day, before Wortman headed out for a drive.
Wortman also stopped and talked with a fellow denturist, who is not identified, about work and COVID-19.
The gunman’s spouse said Wortman was constantly scouring sites for police gear which he bought in both Canada and the U.S.
Records the RCMP obtained from Canada Border Services Agency showed that Wortman crossed the U.S.-Canada border in Woodstock, N.B., 15 times over a two-year period, with his last return to Canada on March 6. He did not have permits to import supplies for his denturist business, but the CBSA said he was personally importing car parts.
Wortman appears to have had a long history of threats and violence. A former neighbour has spoken out about being harassed by Wortman after reporting to RCMP that Wortman abused his spouse. The spouse and another relative relayed to police an account of Wortman’s vicious attack on his father during a trip to the Caribbean. In 2011, someone reported to Truro police that the denturist threatened to “kill a cop.”
The documents released Monday are the second batch of search warrant documents the court has agreed to release. CBC applied in April for access to the records and seven other media outlets joined the application.
David Coles, the lawyer representing the media organizations, has filed a request for a judicial review of decisions Judge Laurel Halfpenny MacQuarrie had made in the case. Halfpenny MacQuarrie will consider that request Oct. 2 in Halifax provincial court.
If you are seeking mental health support during this time, here are resources available to Nova Scotians.
Canada's biggest maker of paper towel concerned about supply amid COVID-19 – CBC.ca
The head of Canada’s largest manufacturer of tissue products says he’s concerned about the industry’s supply of paper towel ahead of a potential second wave of COVID-19.
Kruger Products CEO Dino Bianco says demand for paper towel has soared as people stay at home and clean more frequently.
He says the industry is “very tight” on paper towel inventory across North America, despite efforts to build up supply.
Bianco says Kruger, which makes SpongeTowels paper towels, is pushing to open its new plant in Sherbrooke, Que., to add more capacity in Canada.
Although slated to open in February 2021, he said the company is trying to get the factory up and running faster. Some machines started over the summer, while more are set to come online in October.
Bianco said the plant will increase the company’s paper towel and toilet paper manufacturing capacity by 20 per cent.
Meanwhile, he says the company is also seeing a shortage of the recycled fibres used in about 25 per cent of its tissue products.
Bianco says Kruger recycles white paper used in offices, but that the market has dried up because people aren’t in offices printing.
Woman suspected of mailing ricin to White House arrested at U.S.-Canada border – CBC.ca
Three U.S. law enforcement officials say a woman suspected of sending an envelope containing the poison ricin, which was addressed to the White House and President Donald Trump, has been arrested at the New York-Canada border.
The officials say the woman was taken into custody by U.S. Customs and Border Protection (CBP) officers and is expected to face federal charges. The officials were not authorized to discuss the ongoing investigation publicly and spoke on condition of anonymity.
Aaron Bowker of the CBP confirmed with CBC News that the arrest took place at the Peace Bridge in Buffalo, N.Y., and that the individual was travelling from Canada into the United States.
The letter had been intercepted earlier this week before it reached the White House.
An RCMP spokesperson told CBC News on Saturday that it was assisting the FBI in the investigation and that “initial information from the investigation suggests that the letter originated in Canada.”
An official from the Western District of New York told CBC News on Monday they “don’t have a time yet for a court appearance.”
There have been several prior instances in which U.S. officials have been targeted with ricin, which can be derived from castor oil plants.
A navy veteran was arrested in 2018 and confessed to sending envelopes containing the substance from which ricin is derived to Trump, CIA Director Gina Haspel, FBI Director Christopher Wray and James Mattis, then the secretary of defence. At least two of the letters made it to a Pentagon mail sorting facility.
The Utah man has yet to be tried in the case and could face life in prison if found guilty.
In 2014, a Mississippi man was sentenced to 25 years in prison after sending letters dusted with ricin to then-president Barack Obama and other officials.
The previous year, a woman was accused of mailing ricin-laced letters to Obama and Michael Bloomberg, then the mayor of New York City. The woman, who tried to frame her husband for the scheme, was sentenced to 18 years in prison after reaching a plea deal.
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