STOCKHOLM (Reuters) – Shares of Ericsson fell 7% on Wednesday after the Swedish telecom gear maker disclosed results of an internal investigation that detailed suspect payments and misconduct in Iraq.
The company’s investigation had identified payments made to use alternate transport routes in connection with circumventing Iraqi Customs, at a time when militant organisations, including Islamic State, controlled some transport routes.
While Ericsson said it could not determine if any employee was directly involved in financing such organisations, several of them have left the company.
If U.S. Department of Justice finds reason to look into it, this could result in large fines, according to Mads Rosendal, an analyst with Danske Bank Credit Research.
(Reporting by Supantha Mukherjee in Stockholm; editing by Niklas Pollard)