China and the Chesapeake-Leopard affair

Huawei CFO Meng Wanzhou pizza

Pizza delivered to Vancouver home of Meng Wanzhou, who has been released on bail

More information is coming out about the arrest in Canada and possible extradition to the US of Huawei CFO Meng Wanzhou (Sabrina Meng) – aka the Huawei Affair. The New York Times filled in some of the details yesterday. In a nutshell, US counterintelligence and federal prosecutors have been exploring action against Huawei on national-security grounds as far back as 2010, but the authorities decided it would be easier to go after the telecom giant for financial crimes:

But criminally charging Huawei or its executives for espionage or other security crimes was not likely to be simple. Former federal prosecutors said doing so often risked exposing the sources of confidential information. As a result, they said, prosecutors often look to bring more conventional cases involving crimes such as bank fraud. Think of it as the Al Capone strategy: Prosecutors went after the notorious gangster by charging him with tax evasion. […]

This summer, the prosecutors decided to file criminal charges against Ms. Meng — fulfilling their yearslong goal of going after Huawei executives for allegedly acting as an extension of the Chinese government.

Prosecutors filed the charges, under seal, on Aug. 22, and a federal judge in Brooklyn signed a warrant for Ms. Meng’s arrest. The charges focused, at least in part, on her allegedly tricking at least four banks, including HSBC and Standard Chartered, into facilitating the company’s Iranian transactions.

While Ms. Meng’s main home is in Shenzhen, China, she regularly traveled to Canada; she and her husband own two houses in Vancouver. The authorities figured it was only a matter of time before she traveled there, and the United States and Canada have an extradition treaty.

On Dec. 1, Ms. Meng flew from Hong Kong to Vancouver International Airport, where she stopped for a 12-hour layover before flying to Mexico. As she got off the plane, the Canadian police arrested her.

US action against Huawei is long overdue. The problem is that “personalizing” this issue by targeting one of China’s most famous female executives (ranked #8 on the 2017 Forbes China list of the country’s Top 100 Businesswomen) – who now faces up to 20 years in prison in the US – is an example of shocking jurisdictional overreach that, if the nationalities were reversed, would be viewed by the American public and government as tantamount to an act of war.

Key unanswered question: Did Meng make her fraudulent presentation to HSBC in the US?

The Guardian draws an intriguing parallel between the US mindset here, and that of the US’s former colonial master more than two centuries ago:

Blame the British, as usual. In 1807, in the midst of a struggle with Napoleonic France, HMS Leopard, a Royal Navy ship of the line, attacked, boarded and captured an American frigate, USS Chesapeake, off Norfolk, Virginia. The British claimed their action was justified by the presence on the American ship of four English deserters, whom they arrested. But, for President Thomas Jefferson, it was an outrageous, illegal infringement of the sovereignty and independence of the infant republic, eventually leading to the 1812 war.

It’s fair to say the Americans never forgot lessons drawn from the Chesapeake humiliation – and have been faithfully following Britain’s script ever since. As its power grew, the US, too, assumed the right to extend its national writ beyond its shores. One modern example is the way the US justice department ruthlessly pursues foreign nationals, such as the Scottish hacker Gary McKinnon, who are deemed to have broken US law. McKinnon’s extradition was ultimately blocked in 2012 by Britain’s then home secretary, Theresa May, after a public outcry.

Here’s a bit more about the Chesapeake-Leopard affair:

The Royal Navy’s humiliating attack on the USS Chesapeake left many Americans clamoring for war, but there was little the ill-prepared United States could do to answer British aggression.

“Never since the Battle of Lexington have I seen this country in such a state of exasperation as at present, and even that did not produce such unanimity.”

–President Thomas Jefferson

As his Royal Navy vessel patrolled off the coast of Virginia, Londoner and former tailor Jenkin Ratford and four other crewmen decided to steal a boat and desert to the shores of Norfolk. Ratford later boasted of his escape to the “land of liberty” in Norfolk’s streets, where his contempt incurred the ire of British authorities. They vowed to make an example of the brazen Englishman, who joined the crew of an American frigate, the USS Chesapeake.

In June 1807, the Chesapeake set sail from Norfolk for the Mediterranean. Its decks scattered with cargo and its guns unwisely stowed, the vessel made an appealing target for the crew of a British vessel, the HMS Leopard, who intercepted it off the coast of Norfolk and aimed to take revenge.

When the British commander requested permission to search the ship for deserters, the American commodore James Barron refused to muster his crew for inspection. Moments later, the captain of the Leopard responded with a barrage of broadsides, killing three Americans and wounding eighteen. British officers then proceeded to board the crippled Chesapeake and seized what they had come for: a handful of suspected deserters, including Jenkin Ratford.

The humiliating exchange infuriated the American public. War fever raged up and down the coast of the United States. President Thomas Jefferson maintained that the country was more exasperated than at any time since the 1775 battle at Lexington Green that touched off the War of Independence, “and even that did not produce such unanimity.” With Republicans and Federalists—normally bitterly divided political factions—both clamoring for action, war between Britain and the U.S. seemed imminent.

In reality, however, there was little President Jefferson could do militarily to respond to the British transgression. America’s small navy was already deployed in the Mediterranean checking the Barbary pirates. America’s army had been long since been gutted by Republicans anxious to reduce government spending. As Jefferson bided his time and war fever subsided, he instead pursued economic coercion as an alternative to war. That economic pressure began a few months later with the passage of the Embargo Act.

The exchange between the Chesapeake and the Leopard had other consequences for its participants, however. Commodore Barron was later court martialed; found guilty of “neglecting on the probability of an engagement, to clear his ship for action,” he was suspended from the navy for five years without pay.

And on August 31, 1807, the Royal Navy got its revenge on the tailor who had deserted his vessel. Tried by court-martial for mutiny, desertion and contempt toward a British naval officer, and sentenced to death, Jenkin Ratford met his end—hanged from the fore yardarm of his former vessel, the HMS Halifax.

The Chesapeake-Leopard affair was one of the events that precipitated the War of 1812, in which the British burned down Washington DC. The Americans got their revenge more than a century later, when FDR stripped the British Empire of its life savings in exchange for desperately needed war supplies at the outset of World War II. History has a dark sense of humor.

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