Huawei Faces US Trial Over Alleged Sanctions Evasion, Bank Fraud and Money Laundering

Huawei Technologies has gone on trial in federal court in Brooklyn, New York, in a long-running criminal case involving allegations of sanctions violations, bank fraud, wire fraud, money laundering, racketeering and theft of trade secrets.

Jury selection began on September 8, 2026, almost eight years after US authorities initially brought charges against the Chinese telecommunications company. Prosecutors allege that Huawei used a network of corporate relationships and international financial channels to conduct business involving Iran while concealing the company's relationship with an Iranian business from financial institutions. Huawei has pleaded not guilty and denies the allegations.

The financial allegations centre on Huawei's relationship with Skycom Tech Co., a Hong Kong-based company that conducted business in Iran. US prosecutors allege that Skycom operated as an unofficial subsidiary of Huawei, despite representations that it was an independent business partner.

According to the prosecution, Huawei's relationship with Skycom was relevant to banks that provided financial services for transactions connected to the Iranian business. Prosecutors allege that Huawei made misleading statements concerning the relationship and thereby prevented financial institutions from accurately assessing the nature of the transactions and their exposure to US sanctions on Iran.

The indictment alleges that more than $100 million in transfers connected with Skycom passed through the US financial system. A federal judge's 2025 ruling allowing most of the charges to proceed described the government's allegations concerning those transfers and Huawei's purported financial benefit from the Iranian operations. The amount remains part of the prosecution's case and is not a finding that Huawei obtained criminal proceeds.

The case involves allegations concerning several international banks. HSBC has been identified as one of the financial institutions that prosecutors say was given misleading information about Huawei's relationship with Skycom. Standard Chartered has also been reported as having concerns about Huawei's business involving Iran and subsequently ending its relationship with the company.

The allegations concerning HSBC are connected to a 2013 presentation made by Huawei's chief financial officer, Meng Wanzhou. US authorities alleged that Meng made misleading statements about Huawei's relationship with Skycom and its activities in Iran. Meng was arrested in Canada in 2018 following a US extradition request.

Meng's case was handled separately from the current corporate prosecution. In 2021, she entered into a deferred prosecution agreement with US authorities and acknowledged the accuracy of a statement of facts concerning her representations to HSBC. She returned to China after the agreement, and the charges against her were subsequently dismissed after she complied with its terms.

The current trial concerns Huawei and the broader allegations against the company. Prosecutors are presenting evidence that they say demonstrates a long-term pattern of conduct involving the use of corporate structures, international financial institutions and business relationships in countries subject to US restrictions.

The Iran-related allegations are only one component of the prosecution. The indictment also includes allegations that Huawei and associated individuals and entities participated in efforts to obtain trade secrets from US technology companies. The companies identified in the case include Cisco Systems and T-Mobile, among others.

Prosecutors have also alleged that Huawei engaged in business involving North Korea while concealing aspects of those activities from financial institutions and others. The government has further accused the company of providing surveillance technology to Iran that was used in connection with monitoring protesters during demonstrations in Tehran in 2009.

The prosecution has characterised the allegations as part of a broader criminal enterprise extending over approximately two decades. During opening arguments, prosecutors alleged that Huawei used deception and concealment to expand its telecommunications business and to continue relationships with countries subject to US restrictions.

Huawei has rejected the government's description of its conduct. Defence lawyers have argued that the prosecution is attempting to portray isolated actions by individual employees as evidence of a corporate-wide criminal conspiracy. The defence has also challenged the government's interpretation of Huawei's commercial activities and its relationship with Skycom.

Huawei has also argued that the US prosecution improperly attempts to apply US law to conduct that occurred outside the United States. The company has maintained that the allegations are unfounded and has denied wrongdoing.

The use of the US financial system is nevertheless a central part of the prosecution's case. The government alleges that transactions connected with Huawei's Iranian business were processed through US financial channels, creating a basis for the charges under US law.

The money-laundering allegations form part of this broader financial case. Prosecutors have charged Huawei with conspiracy to launder money in connection with transactions allegedly involving funds associated with unlawful sanctions-related activity. The charges also include bank fraud, wire fraud and sanctions violations.

The prosecution's case therefore extends beyond allegations that Huawei conducted business in Iran. Prosecutors are seeking to establish that the company concealed relevant information about its corporate relationships and Iranian activities while transactions were conducted through international banks and the US financial system.

The trial follows several years of litigation over whether the charges could proceed. In 2025, a federal judge rejected Huawei's attempt to dismiss most of the indictment, allowing the principal criminal case to move towards trial. The ruling addressed allegations concerning Huawei's Iranian business, trade-secret claims and other conduct included in the indictment.

The case has attracted significant attention because Huawei is one of China's largest telecommunications companies and because the proceedings involve longstanding US restrictions on Iranian business and broader US concerns regarding the company's international operations.

The trial is also taking place against the background of continuing US-China tensions over technology, trade and national security. Huawei has faced extensive US restrictions for several years, including measures limiting its access to certain US technologies and equipment.

No fine or other criminal penalty has been announced against Huawei in connection with the current proceedings because the trial is still underway. The company remains presumed innocent unless the prosecution establishes the charges beyond a reasonable doubt.

The proceedings are expected to continue for several months. The jury will ultimately be required to determine whether the government has proved the individual criminal charges against Huawei based on the evidence presented at trial.

Until the proceedings conclude, the allegations concerning Huawei's relationship with Skycom, its Iranian operations, the movement of funds through international banks and the alleged concealment of information remain allegations made by US prosecutors. Huawei continues to deny the government's claims and is contesting the charges in federal court.

By fLEXI tEAM