Ericsson probed over alleged corruption
Print Edition
US authorities are investigating Swedish telecoms giant Ericsson over claims of corruption in its Chinese operations.
Ericsson said in a statement yesterday that US officials had “a number of questions” relating to its activities without giving further details.
“We will not provide any detailed comments on the request as such, but can say that it relates to Ericsson’s anti-corruption program and questions related to the Foreign Corrupt Practices Act,” said the company. “Ericsson cooperates with US authorities and works diligently to answer the questions.”
The Svenska Dagbladet newspaper, which cited “several sources, independent of each other,” said the probe was being led by the US Securities and Exchange Commission, with assistance from the Department of Justice.
“A senior manager at Ericsson alerted the chief executive at the time, Carl-Henric Svanberg, to interests that Mats H. Olsson (a recently fired manager in Ericsson’s Asian business) had in an Ericsson subcontractor,” said the paper.
“The subcontractor had in fact obtained a monopoly to supply Ericsson in China.”
The paper claims to have seen a document that proves that management at the time had “resolved the issue by offering the whistle-blower early retirement while leaving Mats H. Olsson in the post.”
Current Ericsson CEO Hans Vestberg, at the company since 1988, was head of the company’s global services unit in 2006.
The scandal has prompted one major investor, Sweden’s Nordea bank, to publicly criticize Ericsson.
“If irregularities are discovered, it will cost a lot of money. It’s not good for our shareholders or our customers,” said Sasja Beslik, Nordea’s head of responsible investment.
“As a shareholder we have not been informed about the SEC investigation, which has an effect on the value of the company. These are things that should have been better managed.”
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