Chinese telecoms equipment maker ZTE Corp may pay penalties exceeding $1 billion to the US government to resolve years-old allegations of foreign bribery, according to an exclusive Reuters report. The Justice Department has moved ahead with an investigation into ZTE for allegedly violating the Foreign Corrupt Practices Act (FCPA) in South America and other regions.
ZTE, which already paid $2 billion in penalties to US authorities over export violations during President Donald Trump’s first term, has faced probes worldwide into alleged bribes to secure telecom contracts. The company’s Hong Kong-listed shares tumbled over 12% on Thursday, while its Shenzhen shares fell by their daily limit of 10%.
ZTE stated it’s engaged in “ongoing communication” with the Justice Department and commits to strengthening its compliance system. The company opposes corruption and maintains a zero-tolerance policy.
In the Philippines, ZTE was linked to corruption allegations in a 2015 report by Norway’s Government Pension Fund Global, spanning 1998 and 2014. The Council on Ethics recommended ZTE’s exclusion from the fund, citing bribes to public officials to secure contracts.
