Patt Morrison for April 23, 2012

Wal-Mart bribery case has broader business repercussions

Walmart Stores/Flickr (cc by-nc-nd)

A Walmart cashier standing at her job.

A New York Times report out over the weekend claiming executives at the Mexican subsidiary of Wal-Mart were part of a widespread bribery campaign has not only affected the mega chain’s stocks, but also its reputation. Wal-Mart shares fell almost 5 percent Monday during midday trading.

The New York Times’ exposé Saturday alleged that Wal-Mart de Mexico top brass, according to a former Wal-Mart executive who spoke to the newspaper, orchestrated a scheme to dominate the market and build stores, with bribes paid to obtain permits across Mexico. Wal-Mart sent their own investigators to Mexico City, unearthing mass corruption, including documents showing that Wal-Mart de Mexico executives knew about suspect payments, totaling more than $24 million, and also concealed them from Wal-Mart’s headquarters in Bentonville, Ark.

Instead of American and Mexican law enforcement officials being notified, and Wal-Mart de Mexico leaders being disciplined, the allegations were hidden and not disclosed until the recent article, claimed the Times. Wal-Mart says it is cooperating with authorities. On a broader level, the U.S. government has increased enforcement of the 1977 Foreign Corrupt Practices Act, which halts American companies from bribing foreign government officials or companies to secure business.


Should the U.S. Justice Department look into these allegations by the New York Times against Wal-Mart? Do these bribery claims change your perception of Wal-Mart? Will you continue to shop there, or not? How do these allegations weigh against bribery and corruption investigations into other large companies such as Johnson & Johnson and Avon?


Peter Henning, Southern California native and professor of law at Wayne State University Law School in Detroit, Michigan; also a former federal prosecutor who writes a white collar crime column for the New York Times

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