ZTE

U.S. Senator: "ZTE presents a national security threat to the United States"

by Alan Friedman

May 26, 2018, 1:25 PM

The dual-screened ZTE Axon M

Last week, we told you that the Trump administration had agreed with China on a solution to lift the export ban on Chinese phone maker ZTE. The ban has prevented the company from sourcing Snapdragon chips and other important components for its phones. While the ban would be repealed, ZTE would still face a $1.3 billion fine, a shake up in management, and would install U.S. compliance officers. President Trump confirmed the deal yesterday via Twitter. So it's a done deal, right? Wrong.

According to the New York Times, on Capitol Hill there is bipartisan shock and anger directed at the president. Senator Chris Van Hollen (MD.-D), echoing a 2012 report from a Congressional committee, said, "ZTE presents a national security threat to the United States — and nothing in this reported deal addresses that fundamental fact." On Thursday, a bill passed the House that would prevent the president from making any changes to penalties placed on Chinese telecom firms that broke U.S. laws over the last year. In addition, a bipartisan group of 27 senators wrote a letter to administration officials warning them not to "compromise lawful U.S. enforcement actions against serial and premeditated violators of U.S. law, such as ZTE."

Senator Marco Rubio (FL.-R), a patsy for President Trump in the past, also came out against the agreement. In a tweet, the senator wrote, "Yes they have a deal in mind. It is a great deal... for #ZTE & China." He also stated that congress will now have to intervene. "ZTE: Bad, bad," said Sen. Lindsey Graham (S.C.-R).

ZTE was fined $1.19 billion by the U.S. back in 2017 for selling goods and services to Iran and North Korea. A seven year export ban was stayed as long as ZTE complied with the penalties placed on them by the U.S. Commerce Department. The company had to withhold bonuses due to those involved in the illegal sales, and place a letter of reprimand in their files. When it was determined that ZTE failed to comply in a timely manner with these penalties, the export ban was put into effect until March 13th, 2025.

There has been talk over the years that Huawei and ZTE use their devices and networking equipment to spy on American consumers and corporations. Earlier this month, the Pentagon banned sales of ZTE and Huawei phones on U.S. military bases. Huawei denied the allegations back in March, calling them "groundless speculation."

There are still many unanswered questions about the Trump administration's desire to lift the export ban on ZTE. During the 2016 presidential campaign, Trump constantly accused the Chinese of stealing U.S. jobs, but then sent a tweet a few weeks ago that said the ZTE ban has resulted in "too many jobs in China lost." According to several published reports, 72 hours before sending the tweet, which stated that the president had instructed the Commerce Department to lift the ban, a Chinese government owned company arranged a $500 million loan for a theme park in Indonesia that is licensing the Trump name. That deal will reportedly enrich the president personally.

There is also a contradiction here. In March, the president blocked Broadcom's $117 billion bid for Qualcomm on national security grounds. Yet, both Republicans and Democrats are calling ZTE a threat to national security, and have been for at least six years.

"If the administration goes through with this reported deal, President Trump would be helping make China great again. Simply a fine and changing board members would not protect America’s economic or national security, and would be a huge victory for President Xi, and a dramatic retreat by President Trump."-Sen. Chuck Schumer (N.Y.-D)

For the first quarter of this year, ZTE was the fourth largest smartphone manufacturer in the U.S. with a 10% market share.

The president confirmed the ZTE deal with a tweet sent Friday afternoon

source: NewYorkTimes

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13 Comments

8. mike2959

Posts: 700; Member since: Oct 08, 2011

First off it has been documented that ZTE, BLU, and even the earlier woway phones (I love spelling it like this) all have had spywhere in their phones. It would be nice if the US actually manufactured phones so we could do the same. Then see if everyone else likes it.

posted on May 27, 2018, 11:11 AM 0

12. mootu

Posts: 1541; Member since: Mar 16, 2017

ZTE had Adups software on their phones that were on sale in China, it was used for delivering updates. Huawei has never done business with Adups, this has been stated many times and was misreported by the US media. Blu is an American company, make of that what you will.

posted on May 28, 2018, 1:00 AM 0

7. razmahtaz001

Posts: 501; Member since: May 11, 2013

the u.s. hate countries that spy on them when they themselves spy on other countries...its a fact, every country spy on each other...the u.s. thinks that they are the only ones allowed to spy without consequences...what a sham LOL to be honest, i rather have a foreign country spy on me than my own country.

posted on May 27, 2018, 10:33 AM 1

9. Zappo

Posts: 26; Member since: Oct 04, 2016

‘to be honest, i rather have a foreign country spy on me than my own' Very well said, thumbs up!

posted on May 27, 2018, 11:12 AM 0

5. MarmiteTheDog

Posts: 192; Member since: Jul 31, 2017

It seems a prerequisite to be a US senator is similar to be the US president - the intellect of an ant.

posted on May 27, 2018, 12:29 AM 4

4. sintruder

Posts: 162; Member since: Aug 30, 2012

If ZTE is a threat to national security then just fine them, lift the ban and don't let them sell in the US.

posted on May 26, 2018, 2:55 PM 1

3. Nine1Sickness

Posts: 896; Member since: Jan 30, 2011

Trump is an idiot. First says all these bad things about ZTE then suddenly want to save the company.

posted on May 26, 2018, 2:50 PM 4

2. k4ever

Posts: 240; Member since: Oct 08, 2014

Please don't tell me you're a shill for this guy (the POTUS)? So, let me get this straight: ZTE is a threat to national security in the US. The current POTUS has mentioned this several times in the past. It is verified by our intelligence agencies and Congress. The previous POTUS slaps sanctions on the company. The current POTIS says that's not enough and bans US companies from dealing with ZTE. Then, after a visit from the President of China (and probably a backdoor deal), the current POTUS all of a sudden wants to save ZTE? At least Schumer has been consisted. This stinks to high heaven. Either ZTE is a threat or not.

posted on May 26, 2018, 2:20 PM 4

6. mootu

There has never been any evidence that ZTE or Huawei have been a threat to US national security. It's always been "because we say so" or "they could do this" or they "might do that" The only actual evidence in any of this is that the NSA were caught actually hacking Huawei servers in China.

posted on May 27, 2018, 5:03 AM 2

10. tedkord

Posts: 17532; Member since: Jun 17, 2009

Correction. There's never been any evidence that the public has been briefed on. That doesn't mean there isn't any evidence that the intelligence Community has in their possession.

posted on May 27, 2018, 2:43 PM 0

11. mootu

And if that evidence existed ZTE would not be having the ban repealed.

posted on May 28, 2018, 12:55 AM 0

13. tedkord

Unless, of course, the Chinese government contributed a large sum of money to a business venture that our self interested president was involved in.

posted on May 28, 2018, 1:25 AM 0

1. LionStone

Posts: 1048; Member since: Dec 10, 2010

Yea, exactly like POTUS said, these guys had been running the show for how long and have done NOTHING. Yea, Schumer, uh, yea, we really believe what you say hah.