- The U.S. Department of Justice admitted that Telefonaktiebolaget L M Ericsson (NASDAQ:ERIC) failed to make adequate disclosures about its operations in Iraq before entering a deferred prosecution agreement in 2019 Bloomberg reports.
- The DOJ also determined that Ericsson breached the agreement by "failing to make subsequent disclosure" after signing it.
- Ericsson's dealings in Iraq came to the fore when it admitted receiving questions from the media regarding past compliance-related matters in the country.
- In October, the DOJ accused Ericsson of breaching a $1 billion agreement with prosecutors in 2019 to end a long-running corruption probe.
- Ericsson believed its internal investigation from 2019 covered the descriptions in the media reports about its employees, vendors, and suppliers in Iraq.
- The probe could not identify that any Ericsson employee was directly involved in financing terrorist organizations, and "based on our current assessment of the media reports, we do not believe they change this conclusion," the company told Bloomberg.
- Ericsson added that the investigation led to several employees' exits and multiple other disciplinary and other remedial actions.
- Price Action: ERIC shares traded lower by 13.6% at $7.66 in the market on the last check Wednesday.
