U.S. Judge Demands: What Is Wal-Mart Hiding About Mexico?
Wal-Mart Stores Inc. (NYSE:WMT) continues to show evidence that it took “[saving] money and [living] better” a little too far in Mexico. A recent report by USA News illuminates that a U.S. judge has demanded that Wal-Mart lawyers turn over more information to shareholders who are seeking records that show how the company responded to allegations that bribery was involved in its operations in Mexico. The judge says the lawyers took “a persnickety and narrow approach to turning over documents” and orders that they allow attorneys for large pension funds discern what, and when, company directors knew of the payments.
Additionally, plaintiffs want information about the internal investigation into allegations that bribes were used to speed building permits and gain other favors. The investigation was to be conducted by Bentonville, Ark.-based Wal-Mart.
The New York Times reported last year that instead of expanding an investigation that was started in 2005 after Wal-Mart executives at the company’s largest foreign subsidiary, Wal-Mart de Mexico, were accused of “[orchestrating] a campaign of bribery to win market dominance … [paying] bribes to obtain permits in virtually every corner of the country” — Wal-Mart’s leaders shut it down. Senior Wal-Mart officials halted the investigation in 2006, despite having found evidence that supported the allegations.
Wal-Mart continues to be under the investigation of the U.S. government, but on Monday, the U.S. judge contends that the company’s lawyers are not cooperating, as they continue to take fastidious approaches to what documents they choose to hand over, leading to allegations that they are are breaching their fiduciary duties by allowing and covering up the alleged payments.
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