HSE University Anti-Corruption Portal
Ericsson Found Guilty of Creating a Large-Scale Foreign Bribery Scheme
Natalia Gorbacheva

The Swedish telecommunications giant Telefonaktiebolaget LM Ericsson (Ericsson) has pleaded guilty to the charges of violating the Foreign Corrupt Practices Act (FCPA).


Back in 2019, the company concluded a deferred prosecution agreement (DPA) with the US Department of Justice (DOJ) thereby resolving the charges of bribery of officials in Djibouti, China, Vietnam, Kuwait, Indonesia and Saudi Arabia in the period between 2010 and 2016*.

The specificity of this pre-trial resolution of violations of the FCPA is that an organisation acknowledges the facts as stated in the accusation, i.e. the description of the corruption schemes in the agreement, by entering it, but it does not plead guilty to the crime. However, in the event that the DPA is violated, the US law enforcement can take legal action using the prior or any other additional materials; given that the company has already agreed to the facts of the case in signing the DPA, it has almost no chances to prove its innocence.

That is what happened to Ericsson: as per the information provided by the DOJ, last May the company was notified that it had not respected the DPA provisions on cooperation and disclosure of information, because it had failed to “accurately disclose all factual information and provide evidence” related to the corruption schemes in Djibouti, China and other potential violations of the FCPA, in particular, the alleged bribery of officials in Iraq, which “had hampered the indictment of certain persons and important investigative actions”.

The DPA with the company was broken and the case files were submitted to the court. The legal proceedings resulted in Ericsson’s Guilty Plea and obligation to pay $206,728,848. The company had to undergo a probation period until June 2024; additionally, the independent monitorship of implementation of the DPA was extended by one year.

Prosecutor Damian Williams said that the violation of the obligations assumed by the company under the DPA “indicates that Ericsson did not learn the lesson and will now pay dearly for its continued mistakes”.

*Besides the DPA with the US DOJ, Ericsson was held liable in the framework of the legal proceedings on charges of the Securities and Exchange Commission (SEC), while its subsidiary Ericsson Egypt Ltd. concluded a plea agreement with the DOJ. The parent company was accused of such violations as conspiracy to bribe officials, violation of accounting rules and failure to implement adequate internal controls, and the subsidiary was accused of bribery of officials. The total amount of sanctions was over $1 billion (the criminal fine of $520,650,832 plus the return of illegally obtained property and interest for the period before adjudication of $539,920,000).

Foreign bribery
Criminal prosecution

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