Swedish infrastructure specialist Ericsson is embroiled in a corruption scandal. Ericsson bribed parties in several countries, including the terrorist group Islamic State (IS).
The news emerged from an investigation by journalists Maggie Michael, Sydney P. Freedberg and Dean Starkman on behalf of the International Consortium of Investigative Journalists (ICIJ).
The journalists questioned Ericsson on possible bribe payments to terror group IS. The company is said to have actively done business with terrorists to sell services and use transport routes in Iraq regions controlled by IS.
Breach of terms
In doing so, Ericsson violated an agreement reached with US authorities in 2019 over previous corruption cases in four countries, including Iraq. An internal investigation of Ericsson confirmed the violation. Late last year, Ericsson privately notified US authorities of a breach of terms, which illustrates that the organization has been aware of the breach for some time.
Ericsson’s internal investigation reveals that, in addition to a corruption case in Iraq, unauthorized practices took place in 13 other countries.
Ericsson share price tumbles
The news caused Ericsson’s share price to drop significantly. Shortly after the investigation was published, the share price tumbled by 35 percent. It’s been on the decline ever since.