The FBI has opened a criminal investigation into ZTE over the Chinese company's sale of banned equipment to Iran and its alleged subsequent attempts to cover it up and obstruct a Department of Commerce probe, the Smoking Gun website reported. The federal investigations stem from a Reuters report in March that ZTE had sold Iran's largest telecom firm TCI a powerful surveillance system capable of monitoring landline, mobile and internet communications, according to interviews and contract documents.
Reuters also reported that ZTE's 907-page 'Packing List' for the EUR 98.6 million contract, dated 24 July 2011, included hardware and software products from American companies, including Microsoft, HP, Oracle, Cisco Systems, Dell, Juniper Networks and Symantec. Sales of the equipment are prohibited by US sanctions on Iran.
The Smoking Gun published on its website excerpts from a confidential FBI affidavit based on an interview in May with the general counsel of ZTE's US subsidiary, Ashley Kyle Yablon. According to the affidavit, Yablon told two FBI agents that ZTE officials had discussed shredding documents, altering the packing list, and denying it was genuine in an effort to subvert a Department of Commerce investigation into ZTE's sales of US equipment to Iran.
The Commerce Department issued a subpoena to ZTE the day after the Reuters report, seeking the Iranian contract and the packing list, according to the affidavit. US officials and ZTE both declined to comment, Reuters reports.
