Chinese cellphone equipment maker ZTE has agreed to plead guilty and pay about $900 million to the United States to settle allegations that it violated American laws on selling U.S. technology to Iran.
ZTE, the fourth-largest smartphone vendor in the U.S., will pay $892 million in fines and penalties, U.S. officials announced Tuesday. It has agreed to pay another $300 million, suspended during a seven-year period, if it does not hold up its part of the agreement, which includes an independent compliance monitor.
The company admitted to shipping products containing U.S.-made equipment to Iran, either directly or through other companies, over a six-year period without proper licensing, according to U.S. officials. They say ZTE knowingly shipped about $32 million worth of U.S. goods to Iran and misled U.S. authorities about its compliance with American laws.
"With this action, we are putting the world on notice. Improper trade games are over with," Commerce Secretary Wilbur Ross told reporters Tuesday. He called ZTE's actions "a brazen disregard for our laws."
ZTE reached the agreement with the U.S. Justice, Commerce and Treasury departments. The company will plead guilty to three charges — conspiracy to unlawfully export, obstruction of justice and making false statements to federal investigators, according to a plea agreement released by the Justice Department.