A Silent Handoff, a Memo From Beijing: Huawei Whistleblower Describes Cash Rewards in “A Directive to Steal”

 

BROOKLYN, New York — Heather Campbell was walking through a quiet sixth-floor hallway at Huawei’s Texas offices when the company’s in-house lawyer approached from the opposite direction. They had arranged to meet near the training room, where few colleagues were likely to pass.

Charles de Chateauvieux handed her an envelope. Neither said anything. The envelope changed hands, and they kept walking.

Campbell headed straight for the stairwell. She descended six flights to the parking lot, went to her car and prepared to open the envelope in private.

The scene could have come from a spy film. Campbell recalled it under oath Tuesday in Huawei’s federal racketeering trial in Brooklyn.

It was July 2013. Huawei was still building its consumer brand, but the Chinese company already rivaled Sweden’s Ericsson as the world’s largest telecommunications-equipment supplier.

In court this week, Campbell—a former Marine trained as a Mandarin Chinese linguist, then working as a corporate trainer for Huawei’s American subsidiary—recalled that de Chateauvieux had told her, with a serious look, about a document sent from Huawei’s headquarters in China.

She told jurors that “he was concerned that it was—it was basically asking our employees to steal. It was that. Asking our employees to steal company information from our competitors, and he was concerned about it. He knew that it was not right, and that’s what I recall.”

And so she asked to see the policy herself.

Her testimony goes to a central question in the case: whether alleged technology theft reflected an organized corporate practice.

Prosecutors accuse Huawei and its subsidiaries of conspiring to steal trade secrets and committing financial crimes involving sanctioned business in Iran and elsewhere. The trial opened with testimony alleging that Huawei supplied surveillance equipment used by Iran’s security forces against protesters following the country’s disputed 2009 presidential election. Huawei, which has pleaded not guilty, denies the allegations and argues that individual employees’ misconduct does not establish a criminal enterprise.

Jurors have also heard the agreed statement of facts signed by Huawei chief financial officer Meng Wanzhou, read into the record October 7 by former Federal Bureau of Investigation agent Leigh Ann Sweeney, who worked on the investigation.

Meng is not appearing in the courtroom to explain those admissions or face cross-examination.

As The Bureau has reported separately, a classified Canadian Security Intelligence Service assessment described an extraordinary pressure campaign by China’s Ministry of State Security to prevent Meng’s extradition from Canada. It included interference in the 2019 election, with support calibrated across Canada’s three major political parties. CSIS assessed that Beijing’s concerns included the possibility that Meng could cooperate with American authorities during a criminal trial and disclose privileged information.

The assessment also cited uncorroborated, single-source intelligence that Beijing might consider Meng’s exfiltration or assassination if it became “the only alternative to significant national harm.”

In Brooklyn this week, Campbell testified that the headquarters communication arrived against the backdrop of another troubling episode.

She already knew about the May 2013 incident involving Huawei at T-Mobile’s laboratory in Bellevue, Washington—events previously examined in the trial.

“I couldn’t believe it. I wanted to see it for myself. I needed to see it for myself,” she testified about the headquarters document. “Especially because I had awareness of other things that had happened.”

Asked whether that included the T-Mobile incident, she said yes.

The memo was dated July 10, 2013.

“So just two months before this?” prosecutor Matthew Skurnik asked, referring to Bellevue.

“Correct.”

Campbell had joined Huawei Device USA in April 2012. At Huawei’s Plano offices, de Chateauvieux worked close to her cubicle. They collaborated on training and corporate policies. She described their relationship as friendly and cordial.

She had not received the original memo in her own inbox. Nor had she received the American management email responding to it.

De Chateauvieux arranged to give her a printout near the sixth-floor training room. Campbell understood that the document’s sensitivity explained why he would hand it over rather than forward it by email.

“There was not much traffic over there,” she testified. “There was really no reason for anyone to be over there, other than if there was a training event or just passing through.”

After the handoff, she took the stairs to her car.

“I didn’t want to do it in public. I didn’t want to do it amongst my coworkers,” she said. “I wanted to read it in private because of the potential sensitive nature of the documentation.”

Inside the envelope were two documents that exposed a sharp divide between a headquarters initiative and the American operation’s response.

The first, admitted into evidence as Government Exhibit 16336, was titled “Management Criterion Of Competition Info Collection.”

It described a system for collecting competitor information, evaluating its worth and paying employees who supplied it.

Employees could submit material through a Huawei online community or a designated mailbox. Submissions would be reviewed, winners announced and awards distributed monthly. Regions would also be ranked every six months according to the quantity and quality of information supplied.

Campbell testified that the policy directed employees to submit the most sensitive information using encryption—the cryptographic method of scrambling information between sender and receiver, so that anyone who intercepts the message cannot understand it.

The original English version described “Hierarchical awards” based on information’s “value and confidentiality.”

The reward table ranged from 200 to 2,000 yuan.

A product roadmap was listed at 2,000 yuan. Business documents and project prices were listed at 1,000 yuan. Other categories included contract information, distribution structures, organizational charts, management decision chains and salaries at different levels.

The memo directed that, in principle, information in the two highest reward ranks be encrypted and sent to the special mailbox.

It also bore the notation “Attn: Richard Yu.”

Yu was then chief executive of Huawei’s Consumer Business Group. Today, Huawei lists him as an executive director of its board, chairman of its Investment Review Board and chairman of the Consumer Business Group’s board.

The second document in the envelope was dated July 12, two days after the headquarters memo.

Sent by human-resources director Jennifer Ponder on behalf of Huawei Device USA’s management team, it described the headquarters communication as appearing to encourage employees to earn monetary rewards by collecting confidential competitor information and sending it back to headquarters.

“Please be aware that even though in some foreign countries and regions such a directive and award program may be normal and within the usual course of business in that region. However, here in the U.S.A. we do not condone nor engage in such activities,” Ponder wrote.

The email said such behavior was expressly prohibited by Huawei Device USA’s policies and warned of disciplinary action up to and including termination.

Campbell read both documents.

“I sat and thought. I sat and thought,” she testified.

“I wondered, what does this mean? What am I really reading here? Am I understanding this correctly?”

She stayed in her car for a few minutes, considering what she had seen.

Later, she sought colleagues’ reactions.

She showed the memo to an engineering head named Ivan in the parking lot.

“His reaction was, wow. That’s bad,” she recalled.

Campbell tried contacting the office of Congressman Mike Rogers, then chairman of the House Intelligence Committee. She began telling jurors that he was “specifically investigating” when Huawei’s lawyer objected, and the judge sustained the objection.

She received no substantive response.

“Thought about it. Thought a lot about it. And I, I made contact with the FBI,” she testified. Asked why, she said: “My interpretation of that communication was it was requesting that employees commit theft and corporate espionage. That’s wrong.”

She gave agents both the headquarters memo and Ponder’s response, sat for an interview and met with the FBI on additional occasions.

Under cross-examination, Huawei lawyer Julia Gatto challenged Campbell’s interpretation and emphasized the American management team’s actions.

Campbell acknowledged that she had no role in drafting the memo and no firsthand knowledge of its creation, review or distribution.

Gatto also emphasized the size of the rewards, which, at an exchange rate both sides agreed on, came to roughly $30 to $330, and the American management team’s prompt warning against collecting confidential information.

Campbell acknowledged that Huawei Device USA provided intellectual-property training, that she helped develop it and that employees were tested on the material.

She remained at Huawei for another two and a half years. She sought advancement and, in a promotion-related assessment, described a very pleasant workplace with a positive and friendly atmosphere.

But she maintained her interpretation of the headquarters document.

“It was a directive to steal information,” she said.

She acknowledged the limit of that evidence.

“I don’t know what, if any, actions were taken in China in response to that memo.”

The Bureau’s coverage of the trial, which has included testimony behind closed doors and filings redacted on national-security grounds, continues.

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