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Ericsson Shares Fall Following Violation Of DOJ Agreement

U.S. prosecutors determined Telefonaktiebolaget LM Ericsson’s (NASDAQ: ERICviolated a $1.06-billion settlement agreement reached in 2019 over bribery allegations in five countries.

The U.S. Justice Department intimated that Ericsson breached the agreement by failing to provide certain documents and information related to the settlement, the Wall Street Journal reports.

Ericsson agreed to continue to cooperate with the DOJ.

In 2019 Ericsson reached a deal with the DOJ to resolve bribery allegations that stretched between 2000 and 2016 in Djibouti, China, Vietnam, Kuwait and Indonesia.

The deal, known as deferred prosecution agreement, suspended criminal charges of conspiracy to violate the Foreign Corrupt Practices Act, under the condition that Ericsson undertakes specific reforms and continues cooperating with prosecutors for three years.

A subsidiary, Ericsson Egypt Ltd., also pleaded guilty.

Ericsson also entered into a parallel agreement with the U.S. SEC for allegedly using third parties to bribe officials in Saudi Arabia, China and Djibouti. 

The penalties imposed under the two deals were among the highest ever levied for violations of the FCPA.

ERIC Price Action: ERIC shares were down 2.89% at $11.58 Friday afternoon.

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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