For illustration, a Walmart store in Mexico. GCR makes no claim about this store in relation to the probes (Zijun93/Public domain)

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Walmart pays $282m to settle charges after probes into new-store bribery overseas

24 June 2019 | By GCR Staff | 0 Comments

After a seven-year investigation, US retail giant Walmart has agreed to pay $282.7m to settle charges that it failed to stop subsidiaries using third-party intermediaries to bribe officials in Mexico, India, Brazil and China in order to get new stores built. 

Walmart will pay around $144m to settle charges brought by the US Securities and Exchange Commission (SEC), and around $138m to settle parallel criminal charges levelled by the US Department of Justice.

According to investigators Walmart, turned a blind eye to corrupt practices during a period of rapid expansion between 2000 and 2011, in violation of the US Foreign Corrupt Practices Act (FCPA).

Walmart’s Brazilian subsidiary pleading guilty to a federal crime.

The investigations began after The New York Times revealed in 2012 that Walmart had made suspicious payments to officials in Mexico and then tried to conceal them from top executives at the company’s headquarters in Arkansas.

Walmart said it spent more than $900m on the investigations over the past seven years, including on improving its global compliance programme. 

“Walmart valued international growth and cost-cutting over compliance,” said Charles Cain, chief of the SEC Enforcement Division’s FCPA Unit. “The company could have avoided many of these problems, but instead Walmart repeatedly failed to take red flags seriously and delayed the implementation of appropriate internal accounting controls.”

Assistant Attorney General Benczkowski said: “Walmart profited from rapid international expansion, but in doing so chose not to take necessary steps to avoid corruption.

“In numerous instances, senior Walmart employees knew of failures of its anti-corruption-related internal controls involving foreign subsidiaries, and yet Walmart failed for years to implement sufficient controls comporting with US criminal laws.

“As today’s resolution shows, even the largest of US companies operating abroad are bound by US laws, and the Department of Justice will continue to aggressively investigate and prosecute foreign corruption.”

Image: For illustration, a Walmart store in Mexico. GCR makes no claim about this store in relation to the probes (Zijun93/Public domain)