Walmart Bribery Allegations: Watchdog Group Says Mexican Government Should Investigate Claims Of Vast Bribery Campaign

A van covered by a mural sits parked outside a Walt-Mart Super Center in Mexico City, Saturday, April 21, 2012. Wal-Mart Stores Inc. hushed up a vast bribery campaign that top executives of its Mexican subsidiary carried out to build stores across Mexico, according to a published report by the New York Times. Wal-Mart is Mexico's largest private employer. (AP Photo/Dieu Nalio Chery)

MEXICO CITY — Mexico's federal government should investigate allegations of a vast bribery campaign by top executives of Wal-Mart's Mexican subsidiary to build stores across the country, the head of a watchdog group said Sunday.

Eduardo Bohorquez, director of Transparencia Mexicana, said international conventions obligate Mexico's government to get involved even though only local officials have been linked to the scandal.

"The laws in Mexico and the United States relating to bribery are in effect, so the practices (of legal business) should be the same in both countries," he said.

Government officials declined on Sunday to comment on the allegations contained in a New York Times report that said Wal-Mart Stores Inc. failed to notify law enforcement after its own investigators found evidence that millions of dollars in bribes had been paid in Mexico to spur the company's rapid expansion there.

In 2004, activist groups unsuccessfully sought to block Wal-Mart from building one of its discount Bodega Aurrera stores near the Teotihuacan pyramid site outside Mexico City, and one of the protest leaders charged Sunday that the permit process was rigged.

"Wal-Mart started building without permits, the licenses came later," said Emma Ortega Moreno of the Civic Front for the Defense of the Teotihuacan Valley. "When there are banknotes, you know that they can work wonders. It's said that magicians don't exist, but in that sense, yes, there are magicians."

A lawyer for Wal-Mart de Mexico, Juan Manuel Torres Landa, said the company had no comment on any of the allegations.

Jose Luis Manjarrez, spokesman for the federal Attorney General's Office, said the agency had conducted no investigations on such matters and had no other comment.

One of every five Wal-Mart stores now is in Mexico and it is the country's largest private employer, with 209,000 employees.

The Times said Wal-Mart shut down its internal investigation despite a report by the company's lead investigator that Mexican and U.S. laws likely were violated by executives of Wal-Mart de Mexico, its biggest foreign subsidiary.

In recent years, the U.S. government has stepped up enforcement of the 1977 Foreign Corrupt Practices Act, which bars U.S. companies from bribing foreign government officials or companies to secure or retain business.

Numerous corporations have been ensnared by the law, including Johnson & Johnson, which agreed last year to pay $70 million to settle charges that it bribed doctors in Europe and paid kickbacks to the Iraqi government.

Avon Products Inc. fired its vice chairman in January as part of a long-running probe into allegations that bribes were paid in China. A former chief executive of engineering and construction firm KBR Inc. was sentenced to 2 1/2 years in prison in February for bribing officials in Nigeria to win contracts.

Last month, Mexican authorities announced that they were investigating allegations that a U.S. aviation company paid bribes to secure contracts to maintain government aircraft.

Mexico's Attorney General's Office said the probe involved six officials at two federal agencies and two state governments who allegedly took bribes from Oklahoma-based BizJet International Sales and Support Inc. in exchange of work contracts. Prosecutors said the case involved about $2 million in bribes for contracts worth at least $24 million.

The office gave no other details, but the U.S. Department of Justice said BizJet had agreed to pay an $11.8 million fine to settle allegations its employees bribed government officials in Mexico and Panama to secure maintenance contracts.

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Comments

[Dahveed1]

12:36 AM on 04/24/2012

If you want the Mexican government to investigate, you need to know how to petition them to do that. First, get a whole bunch of money - US dollars - nobody wants that paso stuff. Put them inside the bag with the final investigation report. Hey, it costs extra if they have to think. Plus, then they'd have to find someone to write it down. Last step, give the bag to your "man" in the Mexican government and wait. They're going to call you back and raise the fee, that's a given.

[ztck5356]

10:25 PM on 04/23/2012

So...the news tonight reported that there is an "out migration" of Mexican immigrants going back home to Mexico for the first time since the 80's.

I guess they all got jobs at Walmart?

[mattva99]

04:41 PM on 04/23/2012

They should also look into GE operations in India from the late 90's and early 2000. You don't do business in India without money being passed under the table. Someone should ask GE why they spent so much money on country consultants and what that money was used for. Somehow GE was able to plow through a lot of red tape in a country that runs on bribes.

[Steve77]

03:02 PM on 04/23/2012

"Mexican Government Should Investigate Claims Of Vast Bribery Campaign."

In related news, the KKK should investigate themselves of vast racist campaign.

[Hoodooman]

01:14 PM on 04/23/2012

Those union thugs are certainly ramping things up.

[ujustdewit]

09:14 AM on 04/23/2012

Walmart is evil....

[jadedwilliam]

08:55 AM on 04/23/2012

They pay a fine in millions and make billions in profit. Whats the downside here?

[InnaGaddaDaVida]

09:12 AM on 04/23/2012

fines are cheaper than taxes........

[Epilef2000]

04:24 PM on 04/23/2012

im pretty sure they will figure out a way to get subsidies to cover the temporary fines both in Mexico and the US.

[Rich914]

08:27 AM on 04/23/2012

They tried to bribe officials with hugs, but that just didn't cut it.

[InnaGaddaDaVida]

09:13 AM on 04/23/2012

Appeared to in Columbia...........

[Lindarae1890]

07:56 AM on 04/23/2012

I tried to see the benefits of walmart for the poor. But, after learning that they support ALEC and the stand your ground laws, I see that they care not for their customers but for walmart only. I will never ever shop there again. And, I am ashamed I ever did.

[madame48]

01:20 PM on 04/23/2012

they are putting the small businesses that feed families in towns out of business...just like here except there is nothing to replace them there. I was working in Nicaragua many years ago when the "open the boderes to dumping markets" was demanded by the US. I saw how it put out of work shop keepers, small farmers, small manufacturing, even the local women's clothing manufacture co-op. all now without jobs. yes, it cost less, but now most of the profit leaves the area instead of cycling through its economy.

[martman1]

07:55 AM on 04/23/2012

Wal-Mart paid out $20 billion of after-tax profits last year to shareholders in the form of dividends (taxed at 15%) and share buybacks. Six people own 43% of WalMart, which means they benefited by $8.6 billion last year alone.

Wages not keeping pace with corporate profits over the last 30 years is what has caused such income and wealth disparity and thus the sorry state of our economy. In spite of pension plans, 401k's, etc., 80% of the people hold only 7% of the total shares of stock (the top 1% hold 43%). So when, for example, 83% of growth went to corporate profits over the last 3 years, it eventually flowed to those that were already either extremely or relatively better off. The net result is just more erosion of middle class purchasing power.

[InnaGaddaDaVida]

09:15 AM on 04/23/2012

Oh, you're talking about the Twenty Teens, before the great United Citizens movement......

[Decipherer]

07:51 AM on 04/23/2012

OK, I'm not going to apwns much time poring over the comments on this unbelievable Walmart scandal and coverup, but what I am wondering is whether the rightwingers who are so militant about dealing with all forms of government corruption (GSA, Secret Service, etc.) -- small scale stuff -- are willing to call out the Master of the [Private Sector] Universe and have them clean house, and come clean on what was done and sactioned to the highest level of this multinational corporation.

Ditto for BP for its destruction of the Gulf of Mexico (Deepwater Explorer, April, 2010), JPMorgan, ExxonMobil . . . the list goes on and on.

So, where are you, 'wingers?

[Decipherer]

07:57 AM on 04/23/2012

That should be "spend" much time . . . actually.

[InnaGaddaDaVida]

09:16 AM on 04/23/2012

Oh no, the Repubs are against spending...their money; Your money, not so much.

[Decipherer]

01:26 PM on 04/23/2012

Add it to the list, Madame!

[blood1]

07:51 AM on 04/23/2012

OK, so maybe yesterday, everyone was out enjoying the weather, but I am curious as to why this is not a big issue. Repubs are very fond of their big donor's (and big box stores), so why aren't we seeing a vigorous defense? Are they waiting for their Luntz-like talking point on how to defend this company?

When a US company becomes one of the largest (?) employer in a country, does that mean that they become too big to fail. While it merits an investigation - the timing may be tricky, or did someone just sit on this, waiting for the legal clock to run out?

[Prankster]

07:46 AM on 04/23/2012

Sprawlmart ... Always low wages!

[beau taylor]

07:45 AM on 04/23/2012

If I had a choice between shopping at Wal-Mart and the local Salvation Army for clothing, I'd choose the Salvation Army, at least you could find something that didn't make you look like you flopped out of the same cookie cutter. Better yet most of it will be made in the USA and purchased from local merchants that the big box put out of business.

[rothomaha]

07:25 AM on 04/23/2012

Sounds like Walmart learned a lesson from the RCC - "investigate and bury the evidence". Why investigate in the first place if that's what the intent is? Seems like a waste of time and money to me. Oh wait! They find their new executive class that way, of course! The more the graft created, the more desirable exec material they become! And look, they can't even be accused of discrimination, b/c after all, some of those crooks are actually Hispanic and they've made it to the top! Perfect! BTW - sarcasm is all intentional.