ZTE Fined Record $1.2 Billion for Illegally Selling Tech – Huawei Next?
ZTE, China’s second-biggest telecommunications manufacturer has been caught illegally selling their US-made equipment to both Iran and North Korea. The company has been slapped with a huge USD1.2 Billion by the United States government for breaching US sanctions. The is by far the biggest criminal fine by the US government to date.
According to the United States Department of Commerce, the Chinese company sold US-made hardware and software to Iran from 2010 to 2016 and was also charged of selling well over 200 shipments of tech to North Korea. Both countries are under US trade embargoes. The US government also added that ZTE deliberately lying and gave misleading information to officials when questioned.
ZTE is required to pay $892,360,064 in immediate fines with $300,000,000 more if they violate any terms of agreement. Furthermore, ZTE will also be put on a three-year corporate probation and the company’s business dealings will be constantly monitored.
ZTE responded with their new CEO, Dr Zhao Xianming saying,
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.
ZTE recently changed their top executives in April 2016 and hopes that this unsavoury situation would be a wake up call for the company.
ZTE’s rival Huawei is also being investigated by the US Department of Commerce for a similar case. The world’s biggest telecommunications company has been subpoenaed June of last year and is demanded to present all documents regarding the export and re-export of American technology to Cuba, Iran, North Korea, Sudan and Syria.
Huawei responded by saying that they will comply with all laws and regulations of the countries they operate in.
Pokdepinion: It’s a well known fact that all major companies deal in shady business anywhere in the world and the fact that some of these companies got caught with their pants down proves that crime doesn’t pay. Or in this case you have to pay. A lot.
