Wal-Mart Stores (WMT) said it is ‘probable’ that the world’s largest retailer will incur a loss due to ongoing bribery investigations by itself and government agencies, but it says it is too early to speculate on the size of the damage.
The company said it does not currently expect the loss to be material. The statements came in a filing with the Securities and Exchange Commission filing late Tuesday.
The cost of everyday low prices.As the information trickles in, it seems Walmart’s corrupt practices go well beyond Mexico where the charges initially arose from. Walmart has disclosed that it may have violated corruption laws in at least three other countries besides Mexico.
Wal-Mart Stores has been dealing with allegations that surfaced last April that it failed to notify law enforcement that company officials authorized millions of dollars in payments in Mexico to speed up getting building permits and gain other favors. The Foreign Corrupt Practices Act forbids American companies from bribing foreign officials.
The company has launched its own investigation and is working with government officials in the U.S. and Mexico. In November, the retailer said in a filing with the Securities and Exchange Commission that it was looking into potential U.S. bribery law violations in Brazil, China and India.
Walmart also faces allegations beyond engaging in the corrupt behaviors as according to the Foreign Corrupt Practices Act once corporate executives are made aware of a problem they are supposed to take action to stop the illegal conduct. Walmart executives not only did not stop the behavior when made aware of it but may have even attempted a coverup. The alleged lawbreaking has already lead to a shareholder lawsuit if reports of a coverup are confirmed the damage will likely be severe both to the company and the executives involved.