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Review finds no Huawei spying proof: sources

SAN FRANCISCO -- A White House-ordered review of security risks posed by suppliers to U.S. telecommunications companies found no clear evidence that Huawei Technologies Ltd. had spied for China, two people familiar with the probe told Reuters.

Instead, those leading the 18-month review concluded early this year that relying on Huawei, the world's second-largest maker of networking gear, was risky for other reasons, such as the presence of vulnerabilities that hackers could exploit.

These previously unreported findings support parts of a landmark U.S. congressional report last week that warned against allowing Chinese companies Huawei and ZTE Corp. to supply critical telecom infrastructure.

But they may douse speculation that Huawei has been caught spying for China.

Some questions remain unanswered. For example, it is unclear if security vulnerabilities found in Huawei equipment were placed there deliberately. It is also not clear whether any critical new intelligence emerged after the inquiry ended.

“The White House has not conducted any classified inquiry that resulted in clearing any telecom equipment supplier,” White House National Security Council spokeswoman Caitlin Hayden said. She also noted that Huawei had been barred from participating in an emergency network for first responders a year ago “due to U.S. government national security concerns.”

A spokesman for China's foreign ministry called for a “level playing field” for Chinese companies in overseas business.

“As far as the report cited is concerned, it proves again that allegations against Huawei are unfounded,” said Foreign Ministry spokesman Hong Lei, when asked to comment on an earlier version of this story.

At the White House's direction, according to people familiar with the matter, intelligence agencies and other departments conducted the largely classified inquiry, delving into reports of suspicious activity and asking detailed questions of nearly 1,000 telecom equipment buyers.

“We knew certain parts of government really wanted” evidence of active spying, said one of the people, who requested anonymity. “We would have found it if it were there.”

A spokesman for Huawei said the company was not familiar with the review but it was not surprised that no evidence of Huawei espionage was found.

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