Ericsson braces for 12 billion kronor bill to settle US corruption probe

AFP/The Local
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Ericsson braces for 12 billion kronor bill to settle US corruption probe
Ericsson CEO Börje Ekholm said the company had failed in the past. Photo: Lars Schröder/TT

Swedish telecoms giant Ericsson has made a 12 billion kronor ($1.2 billion) provision to resolve a US corruption investigation.


Swedish telecoms equipment maker Ericsson said on Thursday it had made a 12 billion kronor ($1.2 billion) provision to cover the costs of resolving a US corruption investigation.

The charge, which will impact the company's third quarter earnings, covers the penalty Ericsson expects to receive, it said.

Ericsson has been cooperating since 2013 with an investigation by the United States Securities and Exchange Commission (SEC) and, since 2015, with an investigation by the US Department of Justice.

The investigation covers a period up to the first quarter of 2017, and involves operations in six countries: China, Djibouti, Indonesia, Kuwait, Saudi Arabia and Vietnam.

"With today's announcement we confront another legacy issue and take the next step in resolving it. We have to recognize that the company has failed in the past," Ericsson chief executive Börje Ekholm said in a statement.

The company acknowledged there had been several breaches of its code of business ethics.

It said they included "a failure to react to red flags and inadequate internal controls which enabled a limited number of employees to actively circumvent internal controls for illegitimate purposes".

Ericsson is scheduled to present its third quarter earnings report on October 17th.


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