Author: Nicola Sharp
16 March 2021
2 min read
Nicola Sharp considers a recent case that highlighted the scope of the Act
When a London court rejected the attempt by Huawei’s Chief Financial Officer Meng Wanzhou to obtain HSBC records, the issue turned on the Bankers’ Book Evidence Act 1879.
Meng had sought the documents to assist her fight against extradition from Canada to the US, where she and Huawei face multiple charges. The outcome of her case illustrated the Act’s limitations regarding both the nature of the material it covers and its geographical reach.
Brooklyn federal prosecutors have accused Meng of fraud and sanctions violations; saying she lied to HSBC about Huawei’s connections to Skycom. Skycom is an Iranian organisation believed to be functioning as a subsidiary of Huawei.
At a High Court hearing, Meng’s legal team argued that the case against her centres on disclosures made by HSBC to US authorities, relating to accounting, regulatory and compliance records. Meng wanted to gain access to HSBC information about a 2013 meeting she had with a bank executive in Hong Kong; at which she says she used a PowerPoint presentation to explain the true situation regarding Skycom.
She applied under the Bankers' Books Evidence Act 1879 for documents relating to due diligence HSBC had carried out on Huawei while it was a client. She wanted HSBC to disclose the presentation as well as other documents, such as internal employee communications, compliance records and risk evaluations. She believed these would help her show that HSBC executives knew about Huawei’s relationship with Skycom – a factor that could help her challenge the US attempts to extradite her from Canada.
But Mr Justice Fordham said that while the Act allows public access to material used in the “ordinary business of the bank”, this access is limited to activities such as transactions - and does not extend to documents prepared for compliance purposes.
The interpretation of “bankers’ books’’ in the Act refers to “ledgers, day books, cash books, account books and other records used in the ordinary business of the bank, whether those records are in written form or are kept on microfilm, magnetic tape or any other form of mechanical or electronic data retrieval mechanism.’’
Fordham J added that the Act only allows parties to obtain material for legal proceedings that are being brought in the UK, and that parliament did not envisage the law being used by a person in a foreign case.
Fordham J said that the documents sought by Meng were held by US prosecutors and that their disclosure is a matter of US law. He added that Brooklyn prosecutors had barred her from obtaining them.
Meng’s attempts to obtain the records under the Bankers’ Book Evidence Act 1879 were part of a much larger legal battle that spans the globe. The High Court hearing, however, emphasised the parameters of this piece of legislation regarding the types of documentation it relates to and its UK-only application.
Nicola is known for her fraud, civil recovery and business crime expertise, her experience of leading the largest financial disputes and multinational investigations and her skills in devising preventative measures and conducting internal investigations for corporates.