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Trade War

HSBC flagged Huawei's suspicious financial dealings

Chinese company allegedly skirted American sanctions on Iran

Meng Wanzhou is suspected of involvement in a scheme aimed at skirting American sanctions on Iran.   © AP

WASHINGTON -- The arrest of Huawei Technologies' chief financial officer in Canada was triggered by a tip from HSBC Holdings, U.S. media reported on Thursday.

A federally appointed overseer at HSBC flagged suspicious transactions in accounts of Huawei to prosecutors, The Wall Street Journal reported. The bank "is cooperating with investigators and isn't a target in the Huawei probe," the Journal said, citing sources.

Meng Wanzhou, daughter of Huawei founder Ren Zhengfei, is suspected of involvement in a scheme aimed at evading American sanctions on Iran, according to Reuters.

Meng was arrested by Canadian authorities last Saturday at the request of the U.S.

U.S. authorities have been looking at least since 2016 into whether Huawei has been involved in illegal transactions with Iran, Reuters reported.

According to Canadian authorities, the U.S. is seeking extradition of Meng, who was arrested at Vancouver Airport. The Canadian side has not disclosed details at Meng's request. Canada is set to hold a bail hearing Friday. China is demanding her immediate release.

The arrest has thrust Huawei into the center of the U.S.-China trade war. Leading China's research and development into fifth-generation wireless communications, Huawei is central to Chinese President Xi Jinping's signature "Made in China 2025" initiative, which aims to elevate the country into a high-tech powerhouse.

If the Trump administration bans Huawei from doing business with American companies, China's largest private enterprise by sales is expected to suffer a major setback.

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