A former account manager at Swedish telecommunications giant Ericsson faces charges of conspiracy to violate the Foreign Corrupt Practices Act (FCPA) regarding alleged bribes paid to government officials in the Republic of Djibouti.
Afework Bereket helped facilitated the payment of $2.1 million to two high-ranking officials in Djibouti’s executive branch and a high-level executive at Djibouti’s state-owned telecommunications company to obtain a contract valued at approximately €20.3 million (U.S. $24 million), according to an indictment unsealed Wednesday in federal court. Bereket, a dual citizen of Ethiopia and Sweden, served as the account manager for the Horn of Africa, a region that included Djibouti, while on a long-term assignment for Ericsson in Africa. His alleged misconduct is said to have occurred between 2010 and January 2014.
Bereket, who remains at large, is charged with one count of conspiracy to violate the FCPA and one count of conspiracy to commit money laundering. If convicted, he faces a maximum sentence of 25 years’ imprisonment.
“To disguise the scheme, Bereket allegedly engaged in financial sleight-of-hand involving a sham consulting contract, a false due-diligence report, and fake invoices,” said U.S. Attorney Audrey Strauss for the Southern District of New York in a press release.
Through this alleged bribery scheme, Ericsson was able to transfer funds to and through bank accounts in the United States.
In December 2019, Ericsson entered a deferred prosecution agreement with the Department of Justice, which included the appointment of an independent compliance monitor for a period of three years. The company agreed to pay a $520.65 million criminal penalty to settle charges of conspiracy to violate the anti-bribery, books and records, and internal controls provisions of the FCPA.
An Ericsson subsidiary, Ericsson Egypt, also pleaded guilty to a one-count criminal information charging it with conspiracy to violate the anti-bribery provisions of the FCPA.
Ericsson also paid approximately $540 million in disgorgement and prejudgment interest to the Securities and Exchange Commission in a parallel action.