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Wal-Mart in Compliance with Foreign Corrupt Practices Act?
The best defense is a good offense? That’s what one may wonder after Wal-Mart Stores Inc. announced it is launching its own investigation into whether its policies, procedures and internal controls are in compliance with the Foreign Corrupt Practices Act; the legislation deals with anti-bribery.
The retail giant disclosed the investigation to the U.S. Department of Justice and the U.S. Securities and Exchange Commission (SEC). The company has also enlisted the assistance of outside counsel and advisers to implement remedial measures, according to the filing.
Wal-Mart was quoted as having said in the filing, per the December 8th law360.com article, “Wal-Mart Launches FCPA Compliance Probe”: “We cannot reasonably estimate the potential liability, if any, related to these matters. However, based on the facts currently known, we do not believe that these matters will have a material adverse effect on our business, financial condition, results of operations or cash flows.”
Wal-Mart spokesman David Tovar explained, per the article, that the company had, on a regular basis, instituted changes during the past few years to ensure its FCPA compliance programs were more effective. In coordination with that effort, Wal-Mart undertook a global review of its anti-corruption programs.
Tovar was quoted as saying: “We believe this is the right thing to do, in keeping with Wal-Mart’s core values and previous practices.” He also explained the investigation concentrates on “discrete incidents in specific areas”; as well, the company will disclose its findings to federal authorities.
The retail giant operates nearly 9,900 units in nearly 30 countries, including the U.S., Canada, Brazil, China, India, South Africa and Japan. In 2010, the company reported fiscal year 2010 sales of $405 billion, and it employs over 2 million people worldwide.
In recent years, amid the push for financial reform, the housing crisis and the economic downturn, the federal government has moved aggressively to put an end to foreign bribery, and that includes the executives, employees and third parties who allegedly make it possible.
Examples of companies who’ve faced backlash recently include pharmaceutical giant Pfizer Inc… The pharma giant paid over $60 million to settle investigations into whether it used bribes to secure business in foreign countries, according to The Wall Street Journal.
New York-based Pfizer said it had reached agreements in principle with the DOJ and SEC over “potentially improper payments” made by Pfizer and Wyeth Ltd. subsidiaries in connection with certain overseas sales activities.
As well, earlier in 2011, Johnson & Johnson paid U.S. regulators $70 million to settle bribery and kickbacks allegations in connection with overseas business.