ZTE has pleaded guilty in a US federal court to conspiring to violate sanctions that prohibit the sale of technology from the US to Iran.
Specifically, the guilty plea accounted for one count of conspiring to unlawfully export in violation of the International Emergency Economic Powers Act (IEEPA), one count of the obstruction of justice, and one count of making a material false statement.
According to the US Department of Justice, the Chinese telecommunications equipment maker has agreed to pay up to US$1.2 billion in fines. For conspiring to violate the IEEPA, ZTE will pay roughly US$900 million. The company could potentially face a fine of US$300 million if it violates its settlement agreement.
“The plea agreement in this case shows ZTE repeatedly violate export controls and illegally shipped US technology to Iran,” said FBI assistant director, Bill Priestap, when the plea agreement was made at the beginning of the month. “The company also took extensive measures to hide what it was doing from US authorities.”
Plea documents showed that ZTE had sold approximately US$32 million of US-origin items to Iran between 2010 and 2016, both directly and through third-party companies. These transactions were done without the required export license from the US government. The company then proceeded to lie to federal investigators, saying they had stopped shipping items to Iran, and created a scheme to hide the data associated with these transactions.
ZTE will also be required to undergo a three-year corporate probation period. During this time, the company's compliance will be monitored.