Popular telecommunications company Zte has been imposed with a huge penalty to the tune of $1.2 billion for violating US sanctions. Based in Shenzhen, China, the company has reportedly violated sanctions imposed by the US against North Korea and Iran and have no way other than to pay the huge fine, which is regarded as the largest penalty in the history of the US business.

According to a report released by the US Commerce Department, ZTE has involved in a conspiracy to evade US embargo against Iran from 2010 to 2016. It has been alleged that the firm sold software and hardware manufactured in the United States to sanctioned countries like Iran.

Meanwhile, ZTE has been held responsible for exporting 283 units of routers and servers to North Korea. The US Government prohibits companies from exporting any goods to countries that are facing embargoes. It looks like the officials are keeping track of products moving out from the US and slapping penalties aggressively after Donald Trump assumed office as President.

ZTE executives lied during investigation

According to sources, the company officials made a hard attempt to misled investigators whenever they are questioned. Moreover, they concealed several crucial facts over last five years. The fraud came to light when sleuths seized a laptop from the office of ZTE lawyer. After a deeper cyber and forensic examination, they recovered several documents, which provided the clinching evidence of all the violations.

Additional penalty likely to be imposed on ZTE

ZTE will have to pay a fine of $892 million immediately, which will be followed by another round of penalty to the tune of $300 million. Meanwhile, ZTE has accepted the fact that the company had made mistakes in the past. The company management takes full responsibility for all the violations.

However, they are committed to the progress of the company and will manufacture products to fulfill the social objectives.

The company said that the management had replaced the top executives after noticing the embargo violations. It includes the appointment of Zhao Xianming as CEO of the company in April 2016. It is to be noted that after Xianming assumed office, they have not violated any rules.

In the meantime, the US Commerce department is now gearing up to screw Huawei in an identical case. It has been reported that the company did conduct trade with countries like Iran, North Korea, Sudan, Syria, and Cuba. The department has not yet released any report of the findings. However, the investigation is almost over, and an outcome is expected within the next few days.

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