Huawei to the danger zone: Now Uncle Sam slaps it with 16 charges of racketeering, fraud, money laundering, theft of robot arm and source code Huawei has been charged by the US government with 16 counts ranging from fraud to conspiring to launder money and steal trade secrets to racketeering. The Department of Justice this week claimed three US-based Huawei brands and two subsidiaries violated federal law by stealing tech from partners, violating confidentiality …
...I have direct experience of teams of Chinese and Korean specialists being invited to GB to see our shiny and innovative systems and procedures. The PHB thought he'd won the lottery, believing they'd buy all "his" stuff.
The rest of us noticed how the visitors were asking the workers a myriad of questions and taking copious notes. We knew immediately that there'd be no sale, just copying and development of similar processes and systems.
Multiply my experience countless thousands of times, and we end up with today's situation. It's nothing to do with nationality or race, it's just human nature, including our PHBs being naive and greedy beggars.
I have the same direct experience. I've worked with representatives of Chinese companies that are working inside a client company. They tend to ask a LOT of detailed questions only partially related to the business at hand. I've had them demand inside confidential technical information that was only thinly related to the work we were doing. Once the Chinese rep demanded the internal schematics for a leading-edge digital chip we were supplying, something we give to no one. In one case employees started locking their desks even when away at meetings because they found items in drawers rearranged.
Their favorite response when denied the information was the same: they would look shocked and surprised (in a fake way) and tell us everyone else gave them this information. This was their stock answer.
The thing is, they were so brazen and open about it we laughed about it later. Only the naive and inexperienced would fall for it.
I can't say I've had that experience with Chinese and certainly not Koreans but I have had it from representatives of American and Israeli companies.
The Americans weren't very good at it though and their copies generally failed.
I did once have something like it with a German company but they just straight out asked if they could copy our technique. I suppose they were at least honest and direct :-)
It's not just the Chinese like their take-aways.
I was working for a well-known systems integrator (they used to build aeroplanes, once upon a time..) in Farnborough while a team from India were there, working on a "joint venture". Everything seemed to be going well until the (employed by BAe, on secondment to the "guests") Secretary turned up one Monday to find the that someone had literally ripped out ALL the ICT kit - they left the mains leads and various bits of CAT-5 cabling, phone and RJ45 plugs in an unholy mess that the Desktop team had to sort out and clear up, but all the PCs, printers, telephones and even a dodgy fax machine had somehow disappeared between her going home before the weekend and her normal Monday start time...
We never did find out where that kit went, or why the management didn't seem to care...
Not only between companies. I worked for a UK company bought out by a much larger Chinese rival. We demoed some of the stuff we'd been working on to some people from their QA dept, and 3 months later they'd copied it and were claiming the ideas were all theirs and denying ever having seen ours. This is to people in the *same fucking company*. It seems to be endemic, possibly cultural, but I wouldn't know, I quit after 3 months.
And unlike the accusations about PRC-friendly backdoors and such, they are bringing these accusations into court, where they can be scrutinized by a judge, jury and Huawei's lawyers. If they are going to do this in the current environment, the DoJ must feel fairly good about their case. At least good enough that they think they can get Huawei to agree to some settlement.
We'll see what happens, but this in particular is not great news for Huawei.
Yes. Unlike the claims the US makes with regards to the 5G nonsense, it will have to actually have solid evidence for these claims.
The possibility remains, of course, that the US has no such evidence and are just harassing Huawei. They could drag Huawei through the courts for a long time without such evidence. Ordinarily, I wouldn't think this was a likely scenario, but given the the weird hardon that Trump has for trashing Huawei, this seems like a possibility.
Slightly related, a couple of decades ago Consumer Reports made a video that alleged that the Suzuki Jimny was unsafe and turned over easily. Apparently a whistleblower then told Suzuki the video was faked, it was filmed on the side of a hill with the camera turned to make it look level so the angle at which it fell over was much greater than appeared. Nothing to do with protecting Jeep, of course.
Suzuki sued CR. It took 8 years of legal tricks to avoid coming to court before eventually CR had to settle out of court. But by then Suzuki had given up and eventually left the US altogether.
It is now mildly amusing that Jeep is owned by Fiat.
Called Consumer Union at the time. It wasn't quite as blatant as filming on a slope, it was complete fraud though. Modifying the course and kept filming ever more violent driving to get the vehicle to tip over just to get the car taken off the road in the USA - which it did (by Suzuki due to sales falling off a cliff).
The professional drivers couldn't get it to tip in any of the standard testing that all the other vehicles were subjected to and even rated it stable and good.
It was the Suzuki Samurai btw.
Thank you for the correction. I should perhaps have checked, I just reported what somebody told me, and so Chinese whispers. However, the Samurai is a Jimny; it was sold under many names.
The Wikipedia article does make it clear that the Consumer Union claims were bollocks, but the US legal system was not capable of delivering a verdict favourable to a foreign manufacturer.
What national security card?
These accusations are a tad more specific than the "Dey Haz Spai Chipz In Dere. Cuz We Sez So!" guff we've been tired of hearing about so far. And they all come down to "They spied on us!! ( Poor us.. [cryface] )" , even though industrial espionage is so common and bog-standard you should expect it and account for it.
Huawei certainly isn't angelically innocent, but the DOJ had better come up with some solid, and public, evidence if they don't want to come out of this with a scorched bum and an even less credibility in the "we're not a political tool" department.
The US Government is like the child that cried WOLF!
They have made dozens of allegations over the last couple of years, without being able to back them up.
Now it just sounds like desperation, although there could be something behind this one. But people have become so weary of the US Government in Jumping Chimpanzee mode, that it will be hard for them to get people to believe the accusations, even if they are true.
At least good enough that they think they can get Huawei to agree to some settlement. ... Marketing Hack
Huawei to agree to some settlement or Uncle Sam in the guise of Donald Trump and the DOJ to seek to inflict some totally ineffective and gratuitous punishment, both personal and pecuniary, on their largest and most avid of trading partners ?
I think I know which will be favourite to be the better one of those two options, Marketing Hack, and it sure aint that crazy latter 0day one.
Well of course the recent revelations about that purveyor of 'security' equipment being owned by the BDH and CIA. If anyone thinks it was just used for diplomatic/security stuff I have a couple of bridges to sell you. Of course they used it for industrial espionage.
Everybody's in on such things. I worked in a lab where the boss was editor of a major journal. He got a paper to review, got a guy in the lab to copy the work and held up the paper so they could publish first. My PhD supervisor once wrote to someone asking for some reagent (science works on this sort of thing) but made the mistake of giving too much info on what he wanted it for. He didn't hear back from them then they published the work he wa going to do.
https://www.theguardian.com/business/2015/apr/30/airbus-could-sue-following-allegations-germany-spied-on-them-for-the-us
"The Airbus threat of legal action on Thursday came amid reports that Germany has been spying and eavesdropping on its closest partners in the European Union and passing the information to the Americans for more than a decade."
As said the BDH is effectively the EU branch of the CIA/NSA
My PhD supervisor once wrote to someone asking for some reagent (science works on this sort of thing) but made the mistake of giving too much info on what he wanted it for. He didn't hear back from them then they published the work he wa going to do. ..... Muscleguy
Beware and be aware the Cabinet Office is very fond of such sourcing. As would be the Ministry of Defence in fields in which they are trailing and failing to catch up and lead with.
And it always leads to them being starved of future novel information in intelligent development with competition and/or opposition being made privy to privileged intellectual property to test their reaction/direction to the paths of travel.
And here was I, thinking that that is how most of the US's business was carried out in the normal run of things. Can you imagine the chaos and confusion if the spyglass was "pointing the other way?"
When foreigners do it, it's organised espionage. When USAians do it, it's "rogue employees"
“violated federal law by stealing tech from partners, violating confidentiality agreements, recruiting employees to steal intellectual property upon leaving their jobs, and tapping university professors and researchers for documents on their work."
All standard and normal American business.
Joking aside, if Huawei had entered into a tech sharing JV with Boeing, I'd expect Boeing to not exist any more except possibly as a small company with a building where boxes with red-shell badges on went in, and boxes with Boeing badges on came out 5 minutes later. That's basically what happened to Motorola between 2000 and 2010 - lots of Moto-management reasoning of "oh look, they make that box so much cheaper than we can, so let's use theirs instead, cull our workforce and trouser bonuses for reducing our opex this year". A few years later, they then wonder where their expertise has disappeared to.
I think the longevity of the people sitting on Huawei's board give them the luxury of thinking for the long term, whereas a lot of western corporates shuffle their CEOs and senior management too regularly, and so they don't look too far ahead
CEOs have to be replaced regularly because the system is based on those societies described in The Golden Bough which have kings that get sacrificed at regular intervals to ensure that the food supply continues. The idea of a board of directors that actually runs the business is just so 20th century.
The advantage of the system is that even the worst choice only lasts a few years, and if the human sacrifice element was reintroduced they wouldn't be able to go on to foul up another company.
One should never underestimate the extent to which the US (and the UK) at some levels is still firmly stuck in the hunter-gatherer mindset of 4000BCE or thereabouts. It explains how we can elect rulers who are simply better at throwing dung or pointy sticks than anyone else.
..and I shall find a way to get you. Whatever it takes. Including causing extradition proceedings in a foreign country knowing that a wealth of material would have to be produced in court there, giving our junior rottweilers lots more to pour over.**
Next they'll start instituting proceedings against any Huawei executive caught speeding. Or chewing gum in church.
**Customarily the courts in England do not like the process of cross-fertilising different cases with evidence produced in only one of them. But this is the Leader of the Free World, so what do I know?
I guess their extradition case in Canada must not be going too well for the US if they have to cobble together some new charges like this.
Current status of the Meng Wanzhou case in Canada is the case has to pass the hurdle of proving "double criminality" when Canada had no equivalent Iran sanctions in force (as Canada was backing the European treaty with Iran). The next hurdle is an abuse of process hearing regarding how she was held and questioned at customs and immigration at the request of the US. Neither of these is decided yet, but there are reasonable grounds for the case being thrown out on either one. And that isn't the end of the story either.
It is possible that this new development may be "Plan B" for the US, as it avoids the rather shaky "double criminality" question and short circuits the very unsavoury details surrounding the abuse of process events.
Nice paywall you got there. Care to summarise?
IMHO, the potential "US 5G competitors" could have been:
a) Motorola - except they were outmanoevered by Huawei - there may well have been iffy behaviour on their part during this time, but equally Moto-management were clearly outclassed (the bit where Huawei held up the sale of Moto wireless to Nokia/NSN was quite a move!)
b) Cisco - who have consistently failed in their attempts to get into the mobile business beyond routers and packet gateways in the core
c) Lucent - struggled to stay relevant, suffered from high costs, didn't ever really get much market traction outside of the US as a RAN supplier (even when part of Alcatel-Lucent)
The main players in 5G infrastructure are now Ericsson, Nokia, Huawei and possibly ZTE at a pinch, maybe also Samsung and NEC.
but equally Moto-management were clearly outclassed
'Twas ever thus. After coming up with the design for the original cellular base stations they sat on their laurels and didn't notice everyone else bringing out better, faster and cheaper technology..
This post has been deleted by its author
The most interesting part of this is that Huawei has managed to steal technology from the future. Because the Chinese are utterly incapable of inventing anything on their own they must have gotten into America's technology future and stolen their 5G stuff from there so they can use it now before the Americans catch up to themselves then and realize that they were going to invent it sometime but Huawei got a hold of it before they could invent it. Who says these Chinese aren't clever?
One assumes Uncle Sam realises they set an unmitigating precedent in presenting such cases against Johnny Rotten/Jane Doe Foreigners which endangers the life and liberty of Americans abroad able to be targeted with similar accusations regarding foreign abilities shared but not necessarily directly ie simply reverse engineered or reasonably reimagineered via intelligent thought processes?
The wisdom of creating such a folly escapes me and it would seem to me to be much more another moronic and future self-defeating move, ill-conceived and counter productive.
"This new indictment is part of the Justice Department’s attempt to irrevocably damage Huawei’s reputation and its business for reasons related to competition rather than law enforcement," it said.
That must be the most honest statement I've seen from a Chinese business.
Really is time for popcorn, methinks.
Or a beer.
The Register 
Biting the hand that feeds IT
Copyright. All rights reserved © 1998–2024
