A day after Wal-Mart Stores Inc. received more bad news that New York City’s pension funds are targeting it in a lawsuit, the company added a positive spin to the bribery debacle.
Lawyers for Wal-Mart yesterday announced an update to the global bribery review the retailer began in late April after news broke that it may have participated in covering up rampant violations to the Foreign Corrupt Practices Act (FCPA) within its Mexican subsidiary, Wal-Mart de Mexico.
According to a letter from Democratic Representatives Elijah Cummings and Henry Waxman, who are members, respectively, of the House Oversight and Energy committees, which have been investigating the retailer, Wal-Mart lawyers have flagged Brazil, China, India and South Africa, in addition to Mexico, as the countries that represent the largest corruption risk. Wal-Mart’s lawyers said they first reviewed the company’s policies in Mexico, Brazil and China, and then suggested it also evaluate operations in India and South Africa.
The letter, sent to Wal-Mart CEO Michael Duke, also notes that Cummings and Waxman will continue to review the company’s anti-corruption policies in other countries. They also have asked Wal-Mart to provide documentation about the review as well as recommendations.
“We are cooperating with the ongoing federal investigations, and as appropriate, will also continue to assist Members of Congress and their staffs in understanding our efforts to address FCPA issues,” a Wal-Mart spokesman said in a statement.
Shortly after the New York Times broke the story in April, Wal-Mart announced that it had appointed a global officer to oversee its compliance with U.S. law that makes paying bribes to foreign officials illegal. Tom Gean, a Wal-Mart in-house lawyer since 2004, was appointed to the new position, and reports to the general counsel for Wal-Mart’s international unit.
On Monday, New York City’s pension funds filed a derivative lawsuit in Delaware Chancery Court against the world’s largest retailer, accusing its officers and board of directors of breaching their fiduciary duty to both the company and its shareholders by not properly handling the issue and possibly trying to cover up the bribes.
The lawsuit seeks to recover corporate assets lost as the result of Wal-Mart’s alleged wrongful acts, tighten legal and regulatory compliance structures and institute improved governance oversight.
Separate derivative cases against Wal-Mart also are pending in Delaware Chancery Court and the U.S. District Court in Arkansas.
For more on Wal-Mart’s internal investigation, read Reuters.
And for more from InsideCounsel on the Wal-Mart bribery scandal, read: