ZTE faces bribery investigation by U.S. Justice Department

Telecoms network supplier ZTE is the subject of a new bribery investigation at the U.S. Justice Department, centered on suspected bribes paid to foreign officials to gain advantages in its worldwide operations, NBC News said.
ZTE US challengeZTE pleaded guilty in 2017 and paid nearly $900 million to settle with the U.S. after an investigation found the telecom equipment maker conspired to evade U.S. embargoes by buying U.S. components, incorporating them into ZTE equipment and illegally shipping them to Iran, Reuters reported.

A year later, the Donald Trump administration slapped a ban on U.S. companies selling goods to the company after it determined ZTE made false statements about disciplining 35 employees tied to the sanctions violations.

The ban was lifted in 2018 after the company paid a $1 billion penalty to the U.S. Treasury and put another $400 million in escrow.

ZTE is the one of rivals to China’s Huawei Technologies, the world’s largest telecom equipment maker.

Huawei has been on the Commerce Department’s entity list since May, which means U.S. companies are restricted from selling goods and technology to the company.

ZTE’s third-quarter net profit more than quadrupled as the company continued to rebound after being hit by crippling U.S. sanctions last year.

U.S. sanctions forced ZTE to stop most of its business between April and July last year after U.S. Commerce Department officials said the company had breached an agreement and was caught illegally shipping U.S.-origin goods to Iran and North Korea. The sanctions were lifted after ZTE paid $1.4 billion in penalties.

ZTE said its net profit for July-September rose more 370 percent from a year earlier to 2.66 billion yuan ($377 million) and net profit for the first three quarters of 2019 was 4.13 billion yuan.

Operating revenue rose 1.55 percent in the third quarter from a year earlier to 19.63 billion yuan.

The company’s big customers include China Unicom, China Telecom and China Mobile and it said last month that the Chinese market accounted for 61 percent of its operating revenue during the first half of this year.

The company earlier said that it secured 35 5G commercial licenses globally in the first nine months of this year.