In 2019, Ericsson entered into a deferred prosecution agreement with the US government for using outside agents and consultants to bribe government officials and operate slush funds in China, Djibouti, Indonesia and Vietnam. As part of that settlement, the company paid a $520 million criminal fine. Now US officials say the company violated the terms of that deal by covering up other allegations of corrupt conduct, including other misconduct in Djibouti and China. Ericsson also failed to disclose allegations and evidence of wrongdoing in Iraq, officials said.
Last year, The Washington Post reported that corporate executives have failed to disclose a string of alleged misconduct in Iraq over a decade, including claims of fraud, bribes and kickbacks.
Ericsson conducted telecom business in areas of Iraq that fell to ISIS
The Stockholm-based company said in a written statement Thursday that “no new illegal conduct has been alleged or charged today,” adding that the Justice Department informed the company “that it had failed to provide documents and information” to the department. provide “in a timely manner” and “had not adequately reported” information about an internal investigation related to its activities in Iraq.
Ericsson CEO Börje Ekholm said in a written statement that the new settlement is “a clear reminder of the historic misconduct” that led to the deferred prosecution agreement in 2019. “We have learned from that and we are on an important journey to transform our culture. .”
The Justice Department under Biden has vowed to more aggressively and efficiently investigate and prosecute corporate misconduct, including in a series of speeches this week to private sector attorneys.
“Ericsson hasn’t learned its lesson, and it now faces a heavy price for its continued misdeeds,” said Damian Williams, the Manhattan U.S. attorney.
A federal judge has yet to approve the plea deal, which calls for Ericsson to plead guilty to the original two charges from the 2019 deferred prosecution agreement, both violations of the Foreign Corrupt Practices Act.
The new settlement also requires Ericsson to be on probation until June 2024.