Ericsson spent 17 years bribing high-ranking government officials and falsifying financial documents as it failed to implement proper internal accounting controls, the company admitted in a settlement with the Department of Justice and U.S. Securities and Exchange Commission (SEC). The settlement to that corruption investigation will cost the vendor $1.06 billion in penalties, though on the bright side that is less than the $1.23 billion financial provision Ericsson had set aside in September to to cover what it anticipated to lose as a result of the settlement and related costs.

The six-year SEC investigation looked at Ericsson's financial shenanigans dating back to the turn of the century. The nefarious activities spanned six countries including China, Djibouti, Indonesia, Kuwait, Saudi Arabia, and Vietnam. The Justice Department’s criminal division determined that Ericsson’s corruption involved high-level executives in a bid to increase profits.

“Through slush funds, bribes, gifts, and graft, Ericsson conducted telecom business with the guiding principle that ‘money talks,’” said U.S. Attorney Geoffrey Berman of the Southern District of New York, in a prepared statement.

Ericsson claims the criminal activity, including multiple breaches of the U.S. Foreign Corrupt Practices Act (FCPA), ended in the first quarter of 2017. During a conference call with analysts and journalists, Ericsson executives said they are not aware of any related investigations underway in any other countries but the company is monitoring the situation.

Ericsson CEO Börje Ekholm described the settlement as “an important step for us as a company that will enable us to move forward.” However, he added, “I view what has happened as completely unacceptable and a hugely upsetting chapter in our history.”

While Ericsson had a compliance program in place during the period of criminal activity, it is clear that those measures “were not adequately implemented,” Ekholm said. Moreover, because the schemes spanned multiple countries and many years, he added: “We need to address our culture in addition to the compliance program.”

The longest running illegal activities occurred in China, where from 2000 to 2016 Ericsson subsidiaries paid various agents, consultants, and service providers tens of millions of dollars to fund illegitimate expense accounts, gifts, and entertainment for foreign officials, according to the Justice Department. The company also used an expense account to win business with Chinese state-owned customers, the agency concluded.

Ericsson paid approximately $2.1 million in bribes to high-ranking government officials between 2010 and 2014 to win a contract in Djibouti. The vendor paid consulting companies in Vietnam and Indonesia about $4.8 million and $45 million, respectively, to create slush funds between 2012 and 2015.

And in Kuwait, between 2011 and 2013, an Ericsson subsidiary paid a consulting company about $450,000 for inside information about the bidding process for a contract with a state-owned network operator. According to the settlement, Ericsson made the payment after it was awarded the contract, which was valued at approximately $182 million.

“Certain employees in some markets, some of whom were executives in those markets, acted in bad faith and knowingly failed to implement sufficient controls, Ekholm said during the conference call. The company claims it has been taking steps to improve its ethics and compliance programs since 2016.

The company fired 50 people last year following an internal investigation into the scandal and has been apologetic and generally forthcoming about the financial impact of the ongoing inquiry into ethics breaches. The settlement includes a fine of $520.7 million payable to the Justice Department and a financial sanction of $458.4 million and pre-judgement interest of $81.5 million to the SEC.

Current Verizon CEO Hans Vestberg led Ericsson between 2010 and mid-2016 – or six months prior to when these activities were alleged to have stopped – when he abruptly resigned following several underperforming quarters. Vestberg who had a 19-year career at Ericsson, had replaced Carl-Henric Svanberg, who left Ericsson to become chairman at BP.