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Ericsson fined $1 Billion for corruption charges

Ericsson, the Swedish global leader in ICT services, has agreed to pay over $1 Billion as part of a settlement concluded with the US Department of Justice, which accused the company for having paid bribes in several countries.

“Ericsson’s corrupt conduct has involved high-level officials in at least five countries for more than 17 years, all in order to increase profits”, Head of Criminal Affairs Department Brian A. Benczkowski denounced.

The firm will pay 520 million to the State Department and 540 million to US Securities and Exchange Commission (SEC), for a related file.

Ericsson has announced in a press release to have budgeted $1.2 billion to pay the fine and refuses to comment further.

According to the agreement with a New York judge, Ericsson is committed to pay the sum within 10 working days and has accepted an independent observer for three years to ensure that the firm complies with the terms.

The Swedish group admitted to have set up as early as 2000 a sophisticated bribery system where nothing appeared on the accounts.

“Using secret sums, bribes, lavish gifts and corruption, Ericsson has operated in telecommunications with the principle that only money counts,” New York Attorney Geoffrey S. Berman lamented the group. Ericsson has agreed to continue to cooperate with criminal justice authorities.

The illegal activities concern Djibouti, China, Vietnam, Indonesia and Kuwait.

In Djibouti, Ericsson paid 2.1 million in bribes to senior officials between 2010 and 2014 to secure a contract of some 20.3 million.

Chinese officials received tens of millions of dollars’ worth of lavish gifts between 2000 and 2016, again to win contracts.

Between 2012 and 2015, 4.8 million were confided to a consulting company in Vietnam for the creation of a slush fund for people who should not have been paid anything.

The same mechanism was used in Indonesia for a slush fund of 45 million. In Kuwait, the promise of $450,000 allowed the Swedes to win a contract of $182 million.

The Brussels Times