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Leidos is a Virginia headquartered information technology, engineering, and science solutions and services company that serves the defense, intelligence, homeland security, civil and health markets. Last fiscal year it generated 87% of its revenue from U.S. government contracts and its customer list includes the U.S. Department of Defense, the U.S. Intelligence Community, the U.S. Department of Homeland Security, the Federal Aviation Administration, the Department of Veterans Affairs and many other U.S. civilian, state and local government agencies.

Leidos was honored in 2021 as an Ethisphere “World’s Most Ethical Company

Leidos recently disclosed:

“Through its internal processes, the Company discovered, in late 2021, activities by its employees, third party representatives and subcontractors, raising concerns related to a portion of our business that conducts international operations. The Company is conducting an internal investigation, overseen by an independent committee of the Board of Directors, with the assistance of external legal counsel, to determine whether the identified conduct may have violated the Company’s Code of Conduct and potentially applicable laws, including the U.S. Foreign Corrupt Practices Act (“FCPA”). The Company has voluntarily self-reported this investigation to the Department of Justice and the Securities and Exchange Commission and is cooperating with both agencies. Because the investigation is ongoing, the Company cannot anticipate the timing, outcome or possible impact of the investigation, although violations of the FCPA and other applicable laws may result in criminal and civil sanctions, including monetary penalties, and reputational damage.”


As highlighted in this prior post, in December 2019 Swedish telecom company Ericsson (a company with American Depositary Shares traded in the U.S.) resolved a net $1.06 billion Foreign Corrupt Practices Act enforcement action – the largest of all-time – concerning conduct in Djibouti, China, Vietnam, Kuwait, Indonesia, and Saudi Arabia.

The DOJ prong of the enforcement action involved a one count criminal information against Ericsson subsidiary Ericsson Egypt Ltd. charging conspiracy to violate the FCPA’s anti-bribery provisions resolved through a plea agreement and a criminal information against Ericsson charging conspiracies to violate the FCPA’s anti-bribery, books and records, and internal controls provisions resolved through a deferred prosecution agreement.

In October 2021, the DOJ accused Ericsson of breaching its DPA obligations. (See here).

In perhaps a casual connection, Bloomberg reports:

“Ericsson may have made payments to the ISIS terror organization to gain access to certain transport routes in Iraq, in a shock admission following years of regulatory investigations. Shares in the Stockholm-based company were down almost 14.5% around lunchtime on Wednesday, its biggest drop in a day since July 2017.

In an interview with newspaper Dagens Industri, chief executive officer Borje Ekholm said that Ericsson had identified “unusual expenses dating back to 2018” but the company hasn’t yet determined who the final recipient of the money was. “What we are seeing is that transport routes have been purchased through areas that have been controlled by terrorist organizations, including ISIS,” Ekholm added.

Ekholm’s comments follow a statement by the telecommunications equipment manufacturer late on Tuesday, in which the company said that it continues to “invest significantly” into a probe regarding compliance concerns in its Iraq-based operations.”

Shortly thereafter, the International Consortium of Investigative Journalists released this statement:

“Ericsson today released a public statement in response to questions from the International Consortium of Investigative Journalists and partners, including SVT in Sweden. The statement by the Swedish company addressed wrongdoing uncovered by ICIJ and its partners as part of a global investigation. The company said it was working with internal employees and external counsel to review misconduct raised to it by ICIJ. Despite the statement from Ericsson, the company has not addressed specific questions put to it by our journalists in relation to a wide range of corrupt behavior in connection to its business in Iraq and elsewhere. ICIJ and its partners will publish our findings soon.”


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