Ericsson will pay over $1 billion to resolve fraud case

NEW YORK (AP) — Sweden-based telecommunications company Ericsson will pay over $1 billion as part of a deal to resolve bribery conspiracy charges, prosecutors in New York said Friday.

Prosecutors said Ericsson and the company's subsidiary Ericsson Egypt Limited were charged with conspiring to bribe government officials, falsifying books and records and failing to implement reasonable accounting controls.

They said the charges pertained to criminal conduct that occurred in Djibouti, China, Vietnam, Indonesia and Kuwait from 2000 to 2016.

Representatives of Ericsson Egypt pleaded guilty in Manhattan federal court Friday while the parent company admitted its participation in the conspiracy and entered into a deferred prosecution agreement, prosecutors said.

As part of a related settlement with the Securities and Exchange Commission, Ericsson agreed to pay $1.06 billion in criminal and regulatory penalties, authorities said.

“Ericsson’s corrupt conduct involved high-level executives and spanned 17 years and at least five countries, all in a misguided effort to increase profits," Assistant Attorney General Brian A. Benczkowski said in a release.

U.S. Attorney Geoffrey S. Berman said Ericsson admitted to a yearslong campaign of corruption.

“Through slush funds, bribes, gifts and graft, Ericsson conducted telecom business with the guiding principle that ‘money talks,'' he added.

In a release, Ericsson acknowledged the announcement by prosecutors and said it has taken significant steps to improve its ethnics and compliance program over the last three years.

“I am upset by these past failings,” said Borje Ekholm, the company's president and chief executive. “Reaching a resolution with the U.S. authorities allows us to close this legacy chapter. We can now move forward and build a stronger company.”

He added: "This episode shows the importance of fact-based decision making and a culture that supports speaking up and confronting issues. We have worked tirelessly to implement a robust compliance program. This work will never stop.”