ZTE, a Chinese telecommunications equipment company, has agreed to pay the U.S. government $892 million after violating Iran sanctions.
The Justice Department announced the agreement in a statement on Tuesday, according to USA Today.
The agreement came after ZTE, known for its smartphones and tablets, pleaded guilty in a scandal involving the illegal shipping of equipment to Iran using items that were made in the U.S., Reuters noted.
According to the investigation in this matter, which lasted for five years, ZTE had been purchasing U.S. items, adding those items to their equipment and then shipping the equipment to Iran illegally.
The company was also charged with being involved in nearly 300 other illegal shipments to North Korea and trying to cover up its wrongdoing.
“ZTE Corporation not only violated export controls that keep sensitive American technology out of the hands of hostile regimes like Iran’s, they lied…about their illegal acts,” U.S. Attorney Jeff Sessions said in a statement, according to Reuters.
“ZTE acknowledges the mistakes it made, takes responsibility for them, and remains committed to positive change in the company,” ZTE Chief Executive Zhao Xianming said.
The telecom equipment maker apparently gets up to 30 percent of its items from U.S. suppliers like Qualcomm, Microsoft and Intel every year, according to Reuters.
ZTE spends about $2.6 billion a year on U.S. items.
As a result of the settlement, ZTE will have to pay more than $1 billion in total to the U.S. Commerce, Justice and Treasury departments, USA Today noted.
The company will now be under close watch for the next three years of their dealings, as a monitor will be used to track the company’s exports.
A penalty with a price tag this high doesn’t usually apply to these types of cases, but Tim O’Toole, an attorney with Miller & Chevalier, said ZTE’s case is unique, Reuters noted.
“What seems really important to U.S. regulators is whether a company or individual after the investigation starts is seen to continue to evade the sanctions and also obstruct the investigation,” he said.
© 2025 Newsmax. All rights reserved.