Ericsson agrees to pay over $1 billion to resolve U.S. corruption probe
Swedish mobile telecoms company Ericsson has agreed to pay over $1 billion to resolve a probe into corruption, including bribing of government officials, over many years in countries including China, Vietnam, and Djibouti, the U.S. Department of Justice said on Friday, Trend reports citing Reuters.
Ericsson has entered into a deferred prosecution agreement related to its scheme to make and improperly record tens of millions of dollars in payments, the Department said. The total charges include a criminal penalty of more than $520 million and another $540 million to be paid to the U.S. Securities and Exchange Commission in a related matter.
The company admitted it had conspired with others to violate the Foreign Corrupt Practices Act (FCPA) from at least 2000 to 2016 by engaging in a scheme to pay bribes, to falsify books and records and failing to implement reasonable internal accounting controls, the Justice Department said in a statement.
Ericsson used third parties to pay bribes to government officials to secure and keep business, authorities said. Consultants were retained create slush funds and transfer money to third parties, according to one of the complaints.
One of the company’s subsidiaries, Ericsson Egypt Ltd, pleaded guilty in the Southern District of New York a charge of conspiracy to violate the anti-bribery provisions of the FCPA.
Pleading guilty can bring additional severe sanctions for certain firms, including the revoking of key licenses, but the company can negotiate waivers to ensure they can continue to operate.
“Through slush funds, bribes, gifts, and graft, Ericsson conducted telecom business with the guiding principle that ‘money talks,’” U.S. Attorney Geoffrey Berman of the Southern District of New York said in a statement.
The company did not immediately respond to a request for comment. It has said previously it was cooperating with U.S. authorities in an inquiry into possible corruption and said it would take a $1.2-billion charge to cover related monetary sanctions and other costs.