This is a couple days old, but two House Democrats have come into possession of evidence of significant crimes by Walmart, including bribery. The Democrats, Henry Waxman and Elijah Cummings, sought additional documents from Walmart on possible violations of the Foreign Corrupt Practices Act. The joint investigation by the Democrats on the House Oversight Committee and the House Energy and Commerce Committee is apparently ready to go with a report, but Waxman and Cummings asked Walmart CEO Michael Duke basically if he had anything to add before the final report was released. This includes access to documents which the committees requested.
Waxman and Cummings tell Michael Duke in the letter that they have enough evidence to nail Walmart already:
During the course of our investigation, we have learned that Wal-Mart’s concerns about potential violations of the Foreign Corrupt Practices Act are not limited to operations in Mexico, but are global in nature. Your outside counsel informed us that, before allegations of bribery in Mexico became public, Wal-Mart retained attorneys to conduct a broad review of the company’s anti-corruption policies. This review identified five “first tier” countries “where risk was the greatest.” Wal-Mart then conducted a worldwide assessment of the company’s anti-corruption policies, culminating in a series of recommendations and policy changes based on those findings.
In addition, we have obtained internal company documents, including internal audit reports, from other sources suggesting that Wal-Mart may have had compliance issues relating not only to bribery, but also to “questionable financial behavior” including tax evasion and money laundering in Mexico.
To date, however, you have not produced a single document we have requested. You have refused to provide Committee staff with copies of any internal reports or specific information about the findings and recommendations of your worldwide assessment. You have refused to provide access to Maritza Munich, Wal-Mart International’s former General Counsel. Indeed, you have not allowed us to speak to any Wal-Mart employees responsible for compliance with the Foreign Corrupt Practices Act.
So Waxman and Cummings asked again for the documents and the cooperation, as they have multiple times since April. Walmart will not comply with the request. So I’d be willing to bet that the investigative report will get released in the coming days. Waxman and Cummings gave Walmart until August 28 to reply, so expect a report after that. [cont’d.]
Under the Foreign Corrupt Practices Act, bribing foreign officials is illegal. An April New York Times story that first accused Walmart also said the company knew about the bribery and shut down an initial internal investigation.
Walmart claims it is, in fact, cooperating. “We have already provided committee staff with two briefings, and we are exploring ways to make additional information available,” wrote Brooke Buchanan, a Walmart spokeswoman, in an emailed statement. “We are committed to doing whatever we can to appropriately address their requests, consistent with the ongoing federal investigation.”
The release of the report would be embarrassing to Walmart, but ultimately, federal authorities would have to follow up. And just to force compliance with the investigation, the Democrats would need majority support in the Republican-controlled House.
So this is about the most that Waxman and Cummings can do. Walmart has said that it’s cooperating with SEC and Justice Department investigations on the subject. Of course, they also said they were cooperating with the House Democrats. There are also as many as a dozen shareholder lawsuits over the bribery allegations.
The members write, “Although you have stated on multiple occasions that you intend to cooperate with our investigation, you have failed to provide the documents we requested, and you continue to deny us access to key witnesses. Your actions are preventing us from assessing the thoroughness of your internal investigation and from identifying potential remedial actions.”
The members initially contacted the Walmart CEO on April 23, 2012, to request a meeting on allegations that top Walmart executives covered up actions by company officials in Mexico that may have violated the Foreign Corrupt Practices Act. Despite repeated attempts to obtain information from key Walmart employees and gain access to documents, the company has continuously failed to comply with the Committees’ requests. This is the fourth letter to the Walmart CEO from Ranking Members Cummings and Waxman.