ZTE Faces Renewed U.S. Scrutiny Over Alleged Venezuela Bribery
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ZTE Corp. confirmed it is in discussions with the U.S. Department of Justice over a new investigation into potential violations of the Foreign Corrupt Practices Act, after reports surfaced suggesting the Chinese telecom equipment maker could face penalties exceeding $1 billion.
The Shenzhen- and Hong Kong-listed company said in a Thursday statement that its operations remain normal, and it will “resolutely safeguard its rights and interests through legal means.”
“ZTE opposes all forms of corruption and maintains a zero-tolerance attitude toward any individuals who may be involved,” the company said.
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- ZTE is in talks with the U.S. Department of Justice over a new Foreign Corrupt Practices Act probe, with potential penalties over $1 billion, focused on South America, especially Venezuela, before 2018.
- ZTE previously paid major U.S. fines, including $1 billion in 2018, after illegal tech shipments and compliance failures, and has operated under a U.S.-appointed monitor.
- Despite revenue of 100.5 billion yuan (+11.6% y/y) in Jan–Sept 2025, net profit fell 32.7%, and news of the probe caused ZTE shares to drop sharply.
- ZTE Corp.
- ZTE Corp., a Chinese telecom equipment maker, is currently under investigation by the U.S. Department of Justice concerning potential violations of the Foreign Corrupt Practices Act. This new probe, reportedly over alleged bribery in South America, could lead to penalties exceeding $1 billion, potentially reaching $2 billion. This adds to ZTE's history of costly encounters with U.S. regulators.
- 2017：
- ZTE agreed to an $892 million settlement for illegally shipping U.S. technology to Iran.
- 2017：
- ZTE reported a net profit of 2.3 billion yuan before sanctions.
- 2018：
- U.S. Commerce Department accused ZTE of violating the 2017 deal and imposed a seven-year ban on U.S. sales to ZTE.
- First half of 2018：
- ZTE reported a net loss of 7.8 billion yuan ($1.1 billion) due to penalties.
- June 2018：
- ZTE agreed to a new settlement with a $1 billion fine, a $400 million escrow payment, a leadership change, and the appointment of a U.S.-selected compliance team.
- 2020：
- ZTE's revenue rebounded to 101.5 billion yuan, close to pre-sanction levels.
- First nine months of 2025：
- ZTE’s revenue rose 11.6% year-over-year to 100.5 billion yuan, but net profit attributable to shareholders fell 32.7% to 5.3 billion yuan.
- Third quarter of 2025：
- ZTE's profit fell 87.8% to 264 million yuan.
- 2025-12-11：
- ZTE confirmed discussions with the U.S. Department of Justice regarding a new Foreign Corrupt Practices Act investigation; its A-shares hit the 10% daily limit and Hong Kong shares dropped 13.1%.
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