Authorization

Wal-Mart rebuffed U.S. settlement in bribery case

Wal-Mart rebuffed U.S. settlement in bribery caseWal-Mart Stores Inc. rejected the U.S. government proposal over how to wrap up a long-running foreign corruption investigation, Bloomberg reported on Thursday.

Officials have proposed that the world’s biggest retailer pay at least $600 million to resolve probes by the Justice Department and the Securities and Exchange Commission into whether it bribed government officials in markets from Mexico to India and China. The retailer has rebuffed the government’s request.

As the agreement wasn’t reached, prosecutors restarted to elicit more evidence from witnesses about alleged bribe-paying in Mexico, according to Bloomberg. If they find more evidence, it will put additional pressure on the company to settle as the penalty could be well above $600 million.

The government has some challenges as well. Some of the behavior it’s been investigating in Mexico, where the bulk of Wal-Mart’s non-U.S. stores are located, may be too old to prosecute.

Officials are working to wrap up an agreement with Wal-Mart before a new administration takes over in January. That would add to the wave of enforcement actions already announced this year, including last week’s agreement by Och-Ziff Capital Management LP to pay $415 million in penalties and fines to settle an U.S. investigation into bribe-paying across Africa.

"As we’ve said from the beginning, we are cooperating fully with the government in this matter and have no further comment on that process," Wal-Mart spokesman Greg Hitt said in an e-mail. He added that the company’s compliance with anti-corruption laws is a priority and that the retailer was recognized this year by a New York Stock Exchange subsidiary for best governance program among large-cap companies.

The Justice Department and the SEC have spent half a decade investigating allegations that Wal-Mart representatives paid government officials over the course of 10 years to fast-track store openings.

The U.S.’s proposed penalty accounts for the profits Wal-Mart reaped from stores it was able to open quickly after allegedly paying officials to speed zoning and building permits. Calculating a fine based only on the amount of the alleged bribes, as the department has done in some cases, would yield a lower penalty.

Even as the sides are grappling over the size of a penalty, they are also discussing whether there will be any criminal charges against any part of the company.

Wal-Mart has already spent $791 million on legal fees and an internal investigation into the alleged payments and to revamp its compliance systems around the world. The retailer has had major turnover in management since the investigations began, including a new chief executive officer, chief financial officer and heads of U.S. and international operations.

Wal-Mart has warned investors that it may face additional costs and a possible loss because of the investigation. It hasn’t said what those costs may be.

While settlement of $600 million or more would be substantial for a company that has gained attention and a competitive edge for its focus on counting pennies to hold down costs, it’s modest relative to the company’s recent global results. The company posted more than $14 billion in profits last year on $482 billion in sales.

The Wal-Mart settlement, as described, would rank among the highest levied under 1977’s Foreign Corrupt Practices Act, which bans companies from bribing officials to win business overseas.
.
See also:
Leave a comment
TOP Video
News
  • Latest
  • Read
  • Commented
Calendar Content
«    Декабрь 2016    »
ПнВтСрЧтПтСбВс
 1234
567891011
12131415161718
19202122232425
262728293031