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Huawei Offered T-Mobile Workers Bonuses for Trade Secrets - DOJ

(Image credit: astudio/Shutterstock)

The U.S. Department of Justice (DOJ) has accused Huawei of stealing trade secrets from U.S. wireless carrier T-Mobile, as well as committing wire fraud and obstructing justice. The U.S. government had already orchestrated the December arrest of Huawei CFO Meng Wanzhou in Canada.

Huawei’s Indictment by Grand Jury

This week, the DOJ unsealed a 10-count indictment of Huawei, charging the company with theft of trade secrets conspiracy, attempted theft of trade secrets, seven counts of wire fraud and one count of obstruction of justice. The indictment was approved by a Grand Jury on January 16.

According to the indictment, Huawei was offering T-Mobile employees bonuses to steal trade secrets from T-Mobile between 2012 and 2014. T-Mobile threatened to sue the company; however, Huawei "produced a report falsely claiming that the theft was the work of rogue actors within the company and not a concerted effort by Huawei corporate entities in the United States and China," thereby obstructing justice, according to the DOJ's announcement this week.

FBI Director Christopher Wray said Huawei was trying to gain an “unfair economic advantage” by breaking U.S. laws. He added that “the FBI will not tolerate corrupt businesses that violate the laws that allow American companies and the United States to thrive.”

Huawei Trying to Get Ahead

According to the FBI, Huawei has been trying to get ahead by offering employees of various companies around the world bonuses based on the value of information they stole. The employees would then send this information to Huawei via encrypted email.

Huawei faces a fine of up to $500,000 for wire fraud and obstruction of justice and up to $5 million for conspiracy and attempt to commit trade secret theft, if found guilty in the court of law.

Canada’s authorities, in cooperation with the U.S. DOJ, arrested Huawei’s CFO Meng Wanzhou late last year. Wanzhou is both a Huawei deputy chairwoman and the daughter of Huawei’s founder, Ren Zhengfei. The arrest was linked to charges that Huawei violated U.S. sanctions against Iran. At the time of the arrest, U.S. Senator Ben Sasse (R-NE) said that China has been “working to creatively undermine our national security interests.”

  • velocityg4
    21722593 said:
    According to the FBI, Huawei has been trying to get ahead by offering employees of various companies around the world bonuses based on the value of information they stole. The employees would then send this information to Huawei via encrypted email.

    Huawei faces a fine of up to $500,000 for wire fraud and obstruction of justice and up to $5 million for conspiracy and attempt to commit trade secret theft, if found guilty in the court of law.

    That's all they would get for that. That's a bargain compared to how much it would cost to research those techs or purchase the rights.
    Reply
  • Steve Sexton
    According to the FBI, Hillary is clean.
    Reply
  • King_V
    21723007 said:
    According to the FBI, Hillary is clean.

    So you're basically saying that the FBI is dead-on accurate.

    I mean, I know you were trolling... but still.
    Reply
  • Godloki
    @velocityg4 Right... That seems like a drop in the bucket for how valuable some of that information may have been.
    Reply
  • s1mon7
    5 million "if found guilty" is pocket money for a company like Huawei. If the secrets are really worth such small amounts, this doesn't even seem worth covering, yet it blew up so hard lately. It's getting mixed up with the arrest and Iran sanctions though, which is another thing.
    Reply
  • mrmez
    As a % of their net worth, that's the equivalent to fining the average American $500.

    Maybe we need to start basing fines of a % of worth or earnings?

    A $5 million fine for Huawei is like... #WorthIt
    Reply
  • Co BIY
    If these were the only issues they should probably say "Sorry" with their fingers crossed behind their back and pull out the checkbook but ...

    It's probably more like the tip of an iceberg. And admitting anything would set them up for civil lawsuits by the damaged parties.

    Mr. Mez. - Basing the fines on the total value of the company encourages the government to target large successful companies based on their value rather than the violations they have committed. See multiple EU prosecutions/ US State Attorney General actions that that look closer to extortion than justice.

    Agree though that the punishment should at least track with the value of the violation to the company and the damaged caused by the theft to victims.

    I'm not sure the legal system is an effective means to deal with companies operating out of a lawless country.
    Reply