Ericsson: a spiral of lies that is costing the Swedish telecom giant dearly

The logo of telecom equipment manufacturer Ericsson, in Beijing, October 14, 2020.

Forced by American justice to recognize an international corruption scandal and to pay a fine of 1 billion dollars (approximately 950 million euros) in the United States, Ericsson is confronted, on December 6, 2019, with the one of the most serious crises in its history. ” Angry “ by these “mistakes of the past”the CEO of the Swedish telecom equipment manufacturer, Börje Ekholm, then undertakes, in a press release, to change mentalities internally to encourage its employees to ” talk ” And “dealing with problems”.

Ericsson’s senior management was rightly alerted, in the days that followed, to a big ” issue ” : an internal investigation, finalized on December 11, 2019, highlighted significant excesses in the Iraqi branch of the group. Corruption, conflict of interest, questionable transactions and, above all, strong suspicions of indirect financing of terrorist groups are mentioned, over a period extending from 2011 to 2019.

Based on the latest documents from the investigations of the American justice and elements taken from the investigation “The Ericsson List”, carried out in partnership with the International Consortium of Investigative Journalists (ICIJ), The world is able to tell how the company, locked in a spiral of lies, tried to sabotage the work of justice.

First series of scandals

During the 2010s, the US Department of Justice (DOJ) investigated, under the extraterritoriality of US law, corruption involving the group in several countries. This principle, on the borderline between an anti-corruption weapon and an economic lever, can be applied as soon as it is possible to link the company’s activity in the United States in one way or another – something easy in the case of Ericsson, which is established there.

The investigations focus on Ericsson’s actions in five countries: China, Vietnam, Indonesia, Kuwait and Djibouti. The patterns of corruption identified consist of bribing leaders to win public contracts, drawing on slush funds. In China, for example, Ericsson has distributed tens of millions of dollars in gifts in order to win contracts. In Djibouti, he paid more than two million dollars in bribes to the local authorities in exchange for a contract relating to the deployment of the 3G mobile network, amounting to approximately 20 million dollars.

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This file led to the signing of an agreement between the DOJ and Ericsson in December 2019: the company recognized the acts of corruption and accepted a fine of 1 billion dollars in exchange for the freezing of the prosecution. The agreement also provides for transparency obligations: the telecoms group must cooperate fully with the American authorities, in particular by transmitting to them “any evidence or allegation as well as any internal or external investigation of which the company is aware”.

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