Wal-Mart is known for having "low prices, every day, in everything". Along with significantly lower prices, however, they’re also known for their tainted reputation. The company has been criticized for a number of its policies and business practices regarding employment and product suppliers, and now, they have bribery to add to the list. Today, Wal-Mart has announced that it has been conducting an "extensive investigation" since 2011 into whether or not the company has been complying with federal law prohibiting them from bribing foreign officials. The announcement came days after the New York Times reported that top executives in the company’s Mexico division tried to cover up an extensive bribery scheme from their headquarters in Bentonville, AK.

On Saturday, the New York Times reported that in September of 2005, Sergio Cicero Zapata, a former executive, emailed a senior Wal-Mart lawyer describing how the Wal-Mart de Mexico foreign unit paid brides in order to obtain permits to build stores in Mexico. Wal-Mart, then, allegedly sent investigators to Mexico City and found that there were indeed $24 million in suspect payments. Instead of reporting this to US or Mexican law enforcement, the company’s leaders ended the investigation and remained quiet. Wal-Mart advised the US Department of Justice about their probe into whether the company had complied with international laws, but it is believe that this was after they learned of the Department of Justice own investigation into the bribery allegations.

If this is true, Wal-Mart is in for a not so good treat. According to Reuters, if these allegations are proven true, it will lead to a time-consuming world probe, substantial financial penalties, and of course, the departure of top executives. In order to begin "remedying" the situation, Wal-Mart may terminate the executives involved with the bribes and/or cover-up in hopes of reaching an out of court settlement with the US Department of Justice for possible breaches of the Foreign Corrupt Practices Act(FCPA). This law prohibits US companies from bribing foreign government officials. If the company can show that the players in this scheme have been removed, the Department of Justice may look at them more favorably on the company and their current management officials.

In addition to showing that they have rid their company from unjust department heads, they will also have to convince the Department of Justice that the scheme was isolated to just Mexico. Since Wal-Mart has major operations in countries like Japan, China, the UK, and Canada, it will hard to them to show that the brides were confine to just one country.

Wal-Mart has experienced bad press before and has recovered from it with minor cuts and bruises since it is still considered one of the world’s largest corporations. This time, if these allegation hold truth, the company may be in for a world of destruction in terms of its business relationships and financial position in the marketplace (their stock has already decreased 3.1 percent). The company’s current Chief Executive Mike Duke and former CEO Lee Scott are two of the senior executives who were allegedly aware of the bribes. Their fate as well as the company’s is yet to be determined.
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Victoria Baston

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