Wal-Mart Stores Inc. may have avoided a legal problem in Mexico, but now India could be an issue.
A long investigation by the U.S. government into allegations that Wal-Mart de Mexico paid millions of dollars in bribes to Mexican officials to speed up the permitting and licensing process, thus hastening the retailer’s expansion, is said to have uncovered no serious offenses.
“As we’ve said from the beginning, we are cooperating fully with the government in this matter and can’t comment further on that process,” a Wal-Mart spokesman said today. “For Wal-Mart, compliance with the U.S. Foreign Corrupt Practices Act and other anticorruption laws is a key priority. We work closely with third-party compliance experts on support and training as we continuously review and strengthen our programs around the world.”
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Wal-Mart officials had initially been expected to face criminal charges. The retailer in 2011 began an internal investigation into possible violations of the Foreign Corrupt Practices Act at a variety of its overseas operations, including Mexico, China, Brazil, South Africa and India.
Wal-Mart to date has spent more than $600 million on the investigations and compliance programs around the world, and will spend $180 million this year, bringing the total investment to nearly $800 million in three years.
In its most recent 10K filing with the Securities and Exchange Commission, Wal-Mart said it is “conducting an internal investigation into, among other things, alleged violations of the Foreign Corrupt Practices Act and other alleged crimes or misconduct in connection with certain of our foreign subsidiaries, including Wal-Mart de México, S.A.B. de C.V., or Walmex, and whether we appropriately handled prior allegations of such violations and/or misconduct.”
Wal-Mart in 2012 was accused of hushing up an earlier internal inquiry into the business practices of Wal-Mart de Mexico.
“We are also conducting a voluntary global review of our policies, practices and internal controls for FCPA compliance and strengthening our global anticorruption compliance programs,” the company said in the filing. “Since the implementation of the global review and enhanced anticorruption compliance programs, the audit committee and we have identified or been made aware of additional allegations regarding potential violations of the FCPA. Inquiries or investigations regarding allegations of potential FCPA violations have been commenced in a number of foreign markets in which we operate, including, but not limited to, Brazil, China and India.”
The Wall Street Journal reported Monday that the government is believed to be investigating Wal-Mart’s business practices in India. According to the report, the retailer paid millions of dollars to government officials to help move goods through customs or else in real estate dealings.