A top Chinese technology executive faces U.S. charges related to business dealings with Iran, a Canadian prosecutor said Friday, after the executive's arrest rocked financial markets around the globe.
In a packed courtroom in Vancouver, a Canadian prosecutor argued that Meng Wanzhou, the chief financial officer of tech giant Huawei, should be denied bail pending possible extradition to the United States because she was a flight risk. She has spent most of the past week at a women's detention facility in a suburb of Vancouver.
The prosecutor disclosed that Meng was wanted by the United States for allegedly deceiving financial institutions about the relationship between Huawei and another tech company, SkyCom, based in Hong Kong, that is alleged to have sold U.S.-manufactured technology to Iran, in violation of U.S. trade sanctions.
In the first glimpse of the case against Meng, prosecutors alleged during the five-hour hearing that she was not truthful to U.S. banks who had asked her about links between the two firms.
An attorney representing Meng, David Martin, told the court "there is no evidence" that SkyCom was a subsidiary of Huawei during the period in question, in 2013 and 2014.
The bail hearing is set to resume on Monday.
If extradited to the United States, Meng would face charges of conspiracy to defraud multiple financial institutions.
The arrest of Meng in Vancouver, at the request of the United States, surprised financial markets after Presidents Donald Trump and Xi Jinping agreed to a trade truce last weekend in Buenos Aires, Argentina.
Stocks plummeted Thursday after news came out of Meng's arrest, which followed months of already shaky markets affected by the U.S.-China trade war.
Trump sounded a note of optimism on Friday about the trade talks with China, tweeting that "China talks are going very well!"
The U.S. and Canadian governments have so far said little about the Meng case. But China has demanded her release, saying she violated no laws in Canada or the United States.
Meng is the daughter of Huawei founder Ren Zhengfei, a former engineer in China's People's Liberation Army. Chinese state media have argued that the United States is abusing the law to hurt the company's international reputation.
However, concerns about Huawei have been growing for some time. Since 2012, the U.S. government has raised alarm about suspicions that Huawei's hardware may have a technical back door that could be used by the Chinese government to gather intelligence.
Huawei has denied that its products pose any security risk and says it is a private company.