Ericsson confirms corruption probes by U.S. authorities

Ericsson confirmed reports that it is the subject of anti-corruption investigations by U.S. authorities, but declined to provide in-depth details of the probes.

In a statement issued following a report by Swedish newspaper Svenska Dagbladet, the infrastructure company said it was asked to voluntarily assist an investigation by U.S. authorities in March 2013, but said it will not provide detailed comment beyond a broad strokes confirmation of the areas being investigated.

Ericsson said U.S. authorities are probing its anti-corruption programme and "questions related to the Foreign Corrupt Practices Act."

According to Svenska Dagbladet, the U.S. Department of Justice (DoJ) and the Securities and Exchange Commission (SEC) are investigating alleged corruption relating to Ericsson's business in China. The Swedish vendor falls under the remit of the U.S. authorities because it is listed on the Nasdaq stock exchange, the Swedish daily added.

The newspaper reported that the probes centre on the role of a former Ericsson executive in China, who allegedly breached the company's rules by holding a business interest in a company supplying equipment to the vendor in the country. The SEC is also investigating allegations of bribery relating to Ericsson's former Microwave Systems business, which the vendor sold in 2006, Svenska Dagbladet added.

Ericsson stated that while it strives to "conduct our business in compliance with applicable laws, matters do arise from time to time as a result of the global nature of our business."

The vendor also stated that it had publicly revealed the request for information from U.S. authorities when the details were first requested in 2013.

However, Reuters noted that press reports at the time linked that announcement to an investigation of the vendor's business in Romania, rather than China.

The news agency added that Ericsson could face a hefty fine if found to have breached the U.S. Foreign Corrupt Practices Act, pointing out that Netherlands-headquartered VimpelCom had fallen foul of the law earlier this year.

VimpelCom in February agreed to pay $795 million (€706 million) in fines and towards disgorgements to U.S. and Dutch authorities to settle investigations into alleged corruption. Roughly half of that amount is believed to have been paid to the U.S. authorities, Reuters reported.

For more:
- see this Ericsson statement
- read this Svenska Dagbladet report (in Swedish)
- view this Reuters article

Related articles:
Ericsson unveils '5G for Germany' initiatives to address industrial use cases
VimpelCom engages Ericsson in $1B global BSS infrastructure overhaul
Huawei, Ericsson among 10 partners to launch rural Dutch 5G test bed
Ericsson: Safety concerns will drive wearables market
VimpelCom to pay nearly $800M to settle Uzbek bribery probes