Two US Congressmen have said they have obtained internal Wal-Mart documents that they say claim staff at the retail giant’s Mexican unit might have evaded tax and laundered money.
Elijah Cummings and Henry Waxman wrote to Wal-Mart Stores CEO Mike Duke to say they had evidence of “compliance issues” at Wal-Mart de Mexico, which has been at the centre of bribery allegations since April.
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“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,” Cummings and Waxman said.
The claims emerged as the two men wrote to Duke to criticise Wal-Mart for not assisting in a Congressional investigation into claims the world’s largest retailer bribed officials in Mexico to open stores.
The Congressmen also claimed Wal-Mart’s concerns of corruption take in other markets, not just Mexico.
The Mexican allegations were made by The New York Times in April when it reported a former Wal-Mart de Mexico executive had told a senior Wal-Mart Stores lawyer in 2005 the Mexican retailer had bribed officials.
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By GlobalDataThe newspaper said Wal-Mart then sent investigators to Mexico City and discovered evidence of bribery. However, after being presented with the evidence, the world’s largest retailer decided to end the investigation, the newspaper said.
The Congressional investigation is one of a number of probes in the US and Mexico into the claims, including those conducted by Wal-Mart and its Mexican affiliate.
In the letter to Duke, Cummings and Waxman said they had learnt Wal-Mart is concerned it may have broken the Foreign Corrupt Practices Act in other markets, as well as Mexico.
“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’,” the Congressmen wrote. “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.”
However, Cummings and Waxman were critical of what they said was Wal-Mart’s lack of co-operation with the Congressional investigation.
“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,” the letter stated.
“With respect to Wal-Mart’s ongoing internal investigation of violations of the Foreign Corrupt Practices Act, your attorneys have not identified a single senior Wal-Mart manager who has been interviewed, they have not provided any timeline for its conclusion, and they have not described its scope in any detail, stating only that it is not limited to ‘any particular allegations’.”
The Congressmen said they wanted to give Wal-Mart the opportunity to respond before issuing their report.
A Wal-Mart spokesperson insisted the retailer was “committed” to working with the Congressional investigation.
“We want to provide Members of Congress with whatever appropriate information we can to help them understand our efforts to address compliance issues. We have already provided committee staff with two briefings, and we are exploring ways to make additional information available. We are committed to doing whatever we can to appropriately address their requests, consistent with the ongoing federal investigation.”
The spokesperson added Wal-Mart’s own “thorough and independent investigation” was “ongoing”.
