The world’s biggest retailer is sent reeling by allegations of bribery
Apr 28th 2012 | MEXICO CITY AND NEW YORK
MOST weeks it slashes prices. This week it was Walmart's turn to be slashed. Jittery investors cut $10 billion from the value of its shares after the New York Times on April 22nd reported insiders' accounts of bribery in Mexico to accelerate the retailer's expansion there.
Walmart's Mexican arm, Walmex, stands accused of greasing local officials' palms over several years to speed the granting of permits to open new stores. Managers at group headquarters in Bentonville, Arkansas, were apparently informed about the payments (which were said to be made through intermediaries) in 2005. They launched a probe, but wound it down without disciplining anyone. They did not disclose any of this to the authorities until last December. Walmart says it began an “extensive” investigation last autumn into its compliance with the Foreign Corrupt Practices Act (FCPA), America's anti-bribery law. In a statement after the article appeared, it said: “If these allegations are true, it is not a reflection of who we are or what we stand for.”