HSBC defends cooperation with US prosecutors, denies Huawei entrapment
HSBC Holdings has issued a statement defending its cooperation
with US prosecutors in a case against China’s Huawei Technologies after Chinese
state media said the bank had set Huawei up.
HSBC said the US Justice Department made formal requests for
information about Huawei, a former HSBC client, and that it didn’t “set a trap”
for Huawei to break US sanctions, as Chinese newspaper People’s Daily wrote in
an article on 24 July. The statement comes amid intensifying US-China tensions
over trade, Hong Kong and Huawei that have put HSBC in the crosshairs as an Asia-focused
trade bank with a large US operation.
Huawei and People’s Daily didn’t immediately respond to
requests for comment.
In the statement, first released on Chinese social media and
geared toward a local audience, HSBC said it wasn’t involved in the DOJ’s
decision to investigate Huawei or to arrest Huawei finance chief Meng Wanzhou
and doesn’t have any hostility to the company. It said it relies on communities
understanding that international banks must follow international rules, and
that they should consider “the values and contributions of their services
provided to international customers and local markets.”
The bank, based in London but with most of its revenue
coming from Hong Kong and China, has been under pressure from Chinese state
media for more than a year for having handed over documents in the Huawei case.
At the time, in 2016, HSBC was being monitored by the Justice Department as
part of a 2012 settlement over sanctions breaches and money laundering. Huawei
lawyers alleged this year in Canada that the DOJ’s grip on the bank gave HSBC a
motive to present Huawei as the mastermind of its sanctions violations. HSBC
denies that.
The US has sought to ban Huawei from its own and other
countries’ telecommunications networks and is seeking the extradition from
Canada of Meng for allegedly misleading banks about ties between Huawei and an
affiliated company in Iran. The banks, which included HSBC, cleared hundreds of
millions of dollars in transactions that potentially violated international sanctions,
the US alleges. Meng and Huawei deny any wrongdoing. HSBC isn’t a party in that
case.
The spat between HSBC and the Chinese press comes two weeks
after the British government said it would bar telecom companies from
purchasing new equipment made by Huawei for their 5G networks. The decision
marked a victory for the US in its attempts to isolate the company and was seen
as retaliation by Britain for China’s recent imposition of a new national
security law in Hong Kong. The law, criticised by many Western governments, was
backed by HSBC’s top executive in the region in a rare public political
statement by the bank.
The recent tensions have cast a light on the tightrope HSBC
walks as Hong Kong’s home bank and as a financier of global trade with US dollars.
It was founded in Hong Kong and Shanghai in 1865 and competes with US banks,
including JPMorgan Chase and Citigroup, in connecting multinational companies
to markets and helping them manage cash.
In its statement on 25 July, HSBC said it is “rooted in
China” and a “supporter of its economic and social development.”
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