Ericsson says its 2019 probe found serious compliance breaches in Iraq

Ericsson said on Tuesday an internal investigation in 2019 found serious breaches of its compliance rules in Iraq, including evidence of corruption-related misconduct and improper use of sales agents and consultants.

The Swedish telecom equipment group said it was working with external counsel to review the findings and remediation resulting from the investigation to identify any additional measures that it should take.

The probe, which was triggered by unusual expense claims in Iraq dating back to 2018, had resulted in several employees exiting the company, other remedial actions being taken, and termination of a number of third-party relationships.

The internal investigating team identified payments to intermediaries and the use of alternative transport routes in connection with circumventing Iraqi Customs, at a time when militant organisations, including Islamic State, controlled some transport routes.

The investigators could not determine the ultimate recipients of these payments or identify that any Ericsson employee was directly involved in financing such organisations, the company said in a statement.

Ericsson had in 2019 agreed with the US Justice Department to pay more than $1 billion to resolve probes into corruption, including the bribing of government officials that took place over many years in countries including China, Vietnam and Djibouti.

Last week, the company said it was, following media inquiries, reviewing an internal probe from 2019 into whether Ericsson staff, vendors or suppliers in Iraq had breached its ethics code.