The New York Times ran an extremely impressive article that alleged huge bribery actions by Wal-Mart Stores Inc. (NYSE: WMT) in Mexico. That was on April 21. Immediately afterward, a flurry of investigations began, or were supposed to have. These included inquiries by the Mexican government. Several media outlets said that the Justice Department would begin an investigation of whether the world’s largest retailer had violated any provisions of the U.S. Foreign Corrupt Practices Act. Walmart said it would examine whether there were problems at any of its other overseas operations. Two congressmen, Elijah Cummings and Henry Waxman, said they had evidence of bribery and tax evasion activity by Walmart.
What began as a series of reactions to the Times article that involved demands for a number of Walmart senior officials, including chairman Robson Walton and CEO Michael Duke, to step down has disappeared from the public eye. That puts the entire matter in stark contrast to other highly visible government probes, like the ones of mortgage-backed securities sales by Goldman Sachs Group Inc. (NYSE: GS), the mortgage foreclosure practices of several of America’s largest banks, and antitrust and other possible charges against Chesapeake Energy Corp. (NYSE: CHK). Chesapeake has a slew of problems, including what may have been unethical or illegal actions by its CEO, Aubrey Kerr McClendon.
Among conspiracy theorists, if any track Walmart, there might be claims that the retailer gives large amounts of money to government officials in the United States and Mexico. In turn, politicians and investigators keep quiet. That cannot be true. The New York Times would have uncovered it. And, hopefully, Walmart’s board has kept close tabs on what the company did in Mexico and how it has comported itself there since April. So, anyone who believes there is a coverup of Walmart’s actions is obviously wrong.
There may be some chance that the smoke around the Walmart probe has little fire underneath it. The New York Times article may have been overreaching. The federal government and Mexican federal attorneys may have discovered that the bribery problems alleged where simply overstated. But it is too early in an investigative process, which might take years, to come to any conclusions.
No, what is more likely is that few Americans care about Walmart’s actions. They happened far away, at least for U.S. residents. The American government does not face the pressure it did when mortgages of people around this country were being foreclosed on. Chesapeake’s questionable land purchases happened in Michigan, of all places. Americans had their interests violated in America. The Walmart actions, if they occurred, happened a long way from “home.” That’s too bad. Bribery, it would seem, may not be as bad as improper foreclosures. But it is close.
Douglas A. McIntyre