An internal investigation at Ericsson has found unusual expense claims in Iraq, dating back to 2018 with evidence of corruption-related misconduct.
Regarding the situation, Ericsson issued this statement (in part):
"The investigation included the conduct of Ericsson employees, vendors and suppliers in Iraq during the period 2011-2019. It found serious breaches of compliance rules and the Code of Business Ethics. It identified evidence of corruption-related misconduct, including: Making a monetary donation without a clear beneficiary; paying a supplier for work without a defined scope and documentation; using suppliers to make cash payments; funding inappropriate travel and expenses; and improper use of sales agents and consultants. In addition, it found violations of Ericsson’s internal financial controls; conflicts of interest; non-compliance with tax laws; and obstruction of the investigation."
"The investigating team also identified payments to intermediaries and the use of alternate transport routes in connection with circumventing Iraqi Customs, at a time when terrorist organizations, including ISIS, controlled some transport routes. Investigators could not determine the ultimate recipients of these payments. Payment schemes and cash transactions that potentially created the risk of money laundering were also identified. "
"Ericsson invested significant time and resources to understand these matters. The investigation could not identify that any Ericsson employee was directly involved in financing terrorist organizations."
In an interview with a Swedish newspaper cited by Bloomberg, Ericsson CEO Borje Ekholm said the unusual payments may have been bribes to ISIS to secure contracts or operations in Iraq.
Ericsson said its has dismissed several employees, terminated a number of third-party relationships, and is working with external counsel to review other remediation measures,
https://www.ericsson.com/en/press-releases/2022/2/update-iraq-media-inquiries
