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Ericsson discloses graft investigation in Greece

Ericsson said Sunday that a Greek prosecutor summoned seven current and former employees in an investigation “involving allegations of possible corruption.”

The probe involves the 1999 sale of an airborne radar system by Ericsson Microwave Systems. Ericsson sold that business unit in 2006 to Saab AB.

Ericsson said in a statement Sunday it transferred all the company records, agreements and documentation to Saab AB.

It said its current and former employees who were summoned haven’t been questioned yet.

“Since an investigation is ongoing, where present and former employees have been served, it is not appropriate for Ericsson to comment further on the substance of this matter,” the Stockholm-based company said.

On Friday, the network services and equipment supplier said authorities in the United States have questioned the company about its anti-corruption program and the Foreign Corrupt Practices Act.

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Here’s Ericsson’s full statement of June 19, 2016:

Ericsson (NASDAQ:ERIC) informs about an investigation in Greece relating to a defense agreement signed in 1999.

Greek authorities have, for a period of time, conducted investigations into arms deals in the Greek defense sector. One investigation involves an agreement in which Ericsson Microwave Systems delivered an airborne radar system to Greece. The contract was signed in 1999. The company reports incidents of corruption annually as part of its Sustainability and Corporate Responsibility disclosures. Ericsson commented publicly on this case more than two years ago, including in conjunction with its Annual General Meeting.

Ericsson Microwave Systems was sold by Ericsson in 2006. Company records, agreements and documentations were handed over as part of the sale.

Recently, as part of the ongoing investigation, seven current and former Ericsson employees have been served with summons in preliminary investigation proceedings by a Greek prosecutor involving allegations of possible corruption.

Ericsson has not been contacted by any authority in this matter.

The current and former Ericsson employees have not yet been provided with the full relevant documentation from the investigation, and have not yet been questioned by the Greek prosecutor.

Since an investigation is on-going, where present and former employees have been served, it is not appropriate for Ericsson to comment further on the substance of this matter.

Ericsson works actively with its anti-corruption program, and has a strong Code of Business ethics which is acknowledged by all employees at the time of employment and repeatedly throughout the term of employment. Ericsson has zero tolerance for corruption and bribery, and we work actively to prevent any kind of corruption within the Group, for example through anti-corruption training for both employees and suppliers. We report transparently on our efforts annually in our Sustainability and Corporate Responsibility Report, which includes our GRI reporting, where we report in incidents of corruption and actions taken.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He’ll be the keynote speaker at the FCPA Blog NYC Conference 2016

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