The New York Times has posted a big one for the Sunday paper, an investigative report that says, after uncovering use of bribery to dominate the Mexican market in 2005, Arkansas-based retailing giant Walmart took steps to cover it all up. The article says the company was more concerned with damage control than rooting out wrongdoing.
This is a big, very bad deal that reaches to the very highest ranks of Walmart, including the former CEO, H. Lee Scott, and the former director of the Arkansas State Police, Tom Mars, who was general counsel of the company in 2005 and is now executive vice president and chief administrative officer. Board chair and Walton heir Rob Walton reportedly received an e-mail about the bribery in 2008. Covering up employees’ involvement in illegal activity is a different order of problem than, say, spreading money around to wine and dine or elect legislators or treating a few women in ways different than men in hiring and employment.
In one meeting where the bribery case was discussed, H. Lee Scott Jr., then Wal-Mart’s chief executive, rebuked internal investigators for being overly aggressive. Days later, records show, Wal-Mart’s top lawyer arranged to ship the internal investigators’ files on the case to Mexico City. Primary responsibility for the investigation was then given to the general counsel of Wal-Mart de Mexico — a remarkable choice since the same general counsel was alleged to have authorized bribes.
The general counsel promptly exonerated his fellow Wal-Mart de Mexico executives. [CORRECTION: My original post said this was a reference to Tom Mars. It was a reference to Jose Louis Rodfiruezmacedo Rivera—the Wal-Mart de Mexico General Counsel—not Tom Mars.]
When Wal-Mart’s director of corporate investigations — a former top F.B.I. official — read the general counsel’s report, his appraisal was scathing. “Truly lacking,” he wrote in an e-mail to his boss.
The report was nonetheless accepted by Wal-Mart’s leaders as the last word on the matter.
Walmart’s response reached me before the NY Times’ daily e-mail on its Sunday stories did — old news, but a new investigation is ongoing and the company is concerned, committed to integrity and yadda yadda yadda: It follows: