Finally drawing a 5-year saga to a close, Chinese mobile manufacturer ZTE has accepted that it violated US sanctions on Iran and shipped its goods there. The company has been slapped with a massive $800 million fine and is now gearing up to pay out the same.
ZTE has pleaded guilty to violating the the US-Iran sanctions and thus ended a 5 year old dispute. The case had the Department of Justice, the FBI and the Department of Homeland Security at the other end. Meanwhile, the complaint against ZTE includes violation of sanctions by shipping product from the US to Iran.
The company further lied about the sanctions when questioned regarding the same — first disagreeing with the fact that anything of the sort took place and the next, stating that it had stopped doing so. What’s more, the DOJ claims that ZTE resumed its business with Iran and even shipped millions of dollars’ worth of U.S. items there — all the while keeping the US government in the dark.
Speaking on the topic, US Attorney General Jeff Sessions said:
ZTE Corporation not only violated export controls that keep sensitive American technology out of the hands of hostile regimes like Iran’s – they lied to federal investigators and even deceived their own counsel and internal investigators about their illegal acts. This plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies.
ZTE CEO, Dr. Zhao Xianming said:
ZTE acknowledges the mistakes it made, takes responsibility for them, and remains committed to positive change in the company. Instituting new compliance-focused procedures and making significant personnel changes has been a top priority for the company. We have learned many lessons from this experience and will continue on our path of becoming a model for export compliance and management excellence. We are committed to a new ZTE, compliant, healthy and trustworthy.
And a new ZTE it is. Lately, the company removed three top level executives (including the CEO) and replaced them with fresh faces.
Meanwhile, the “new ZTE” as they are calling it, has agreed to and will pay out an $892,360,064 fine, coupled with an additional $300,000,000 that has been kept on hold for now. The company is also on a three-year corporate probation. While its business won’t be hampered, it does mean that an independent corporate compliance monitor will be keeping an eye over the company’s goings-on.
