Bribery Pays for Some Walmart Executives

by Christopher Freeburn | April 23, 2013 10:51 am

walmart store 300x180 Bribery Pays for Some Walmart Executives[1]The Mexican bribery scandal that rocked Walmart (NYSE:WMT[2]) last year has proven a f[3]inancial windfall for some of the company’s executives[4].

In regulatory documents filed on Monday, the nation’s largest retailer announced that it had paid extra compensation to members of its audit committee in consideration of their participation in investigating allegations that its Mexican subsidiary had paid bribes to local officials in order expedite the construction of new stores, Reuters notes.

Investigating claims of bribery in its operations in Mexico, India and Brazil cost Walmart $157 million last year. In its filings, the company noted that its audit committee convened more than twice as many times as other board committees to review the investigations.

Walmart paid each audit committee member and additional $60,000 for the extra work. The committee’s chairman received an additional $85,000.

The scandal erupted last year after the New York Times claimed that the company had been warned of bribery at its Mexico subsidiary[5], but had failed to act. The article sparked a federal investigation of Walmart’s practices in Mexico and what company officials in the U.S. knew about it.

Under the U.S. Foreign Corrupt Practices Act, American companies cannot engage in practices that would be considered illegal in the U.S. – like bribing local government officials – even if those activities are commonplace overseas. [6]

Shares of Walmart rose almost 1% in Tuesday morning trading.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/06/walmart-store.jpg
  2. WMT: http://studio-5.financialcontent.com/investplace/quote?Symbol=WMT
  3. f: http://www.reuters.com/article/2013/04/22/us-walmart-pay-idUSBRE93L1AL20130422
  4. inancial windfall for some of the company’s executives: http://www.reuters.com/article/2013/04/22/us-walmart-pay-idUSBRE93L1AL20130422
  5. had been warned of bribery at its Mexico subsidiary: http://investorplace.com/2012/04/wal-marts-mexican-bribery-scandal-5-facts/
  6. even if those activities are commonplace overseas. : http://investorplace.com/2012/04/wal-marts-mexican-bribe-scandal-laughable/

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