Home News Justice Dept. revives corruption charges against Swedish firm Ericsson

Justice Dept. revives corruption charges against Swedish firm Ericsson


Swedish telecom firm Ericsson has agreed to plead guilty and pay more than $206 million as part of a new settlement with the U.S. Justice Department for corrupt practices and violating the terms of a previous settlement for wrongdoing, department officials said Thursday.

The penalties against Ericsson come as Justice Department officials have pledged to get tougher on corporate crime. But the Ericsson case highlights what critics of the department say has been a years-long pattern of granting companies deferred prosecution agreements that let them off easy for wrongdoing.

In 2019, Ericsson entered into a deferred prosecution agreement with the U.S. government for using third-party agents and consultants to bribe government officials and operate slush funds in China, Djibouti, Indonesia, and Vietnam. As part of that settlement, the firm paid a $520 million criminal penalty. Now, U.S. officials say the company violated the terms of that deal by hiding other allegations of corrupt conduct, including additional misconduct in Djibouti and China. Ericsson also failed to disclose allegations and evidence of misconduct in Iraq, officials said.

Last year, The Washington Post reported that company executives did not disclose a range of alleged misconduct in Iraq over a decade, including claims of fraud, bribes, and kickbacks.

Ericsson did 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 notified the firm “that it had failed to provide documents and information” to the department “in a timely manner” and “had not adequately reported” information about an internal investigation related to its business in Iraq.

Ericsson CEO Börje Ekholm said in a written statement that the new settlement “is a stark reminder of the historical 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 pursue corporate wrongdoing, including in a series of speeches this week to private-sector lawyers.

“Ericsson did not learn its lesson, and it is now facing a steep price for its continued missteps,” said Damian Williams, the U.S. attorney in Manhattan.

A federal judge must still approve the plea agreement, 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 will also require Ericsson to be on probation until June 2024.