Suspect payments totaling $24 million have tainted Walmart's operations in Mexico. In a statement released by the company, Walmart acknowledged an investigation related to compliance with the U.S. Foreign Corrupt Practices Act. This follows a damning New York Times article, which alleges a cover-up of widespread bribery.
The Times report quotes former executive Sergio Cicero Zapata, who worked for Wal-Mart de Mexico until 2004.
Cicero told the newspaper he had helped organize payoffs to local officials — including dispatching intermediaries to deliver envelopes full of cash. The aim of the bribes, he said, was to guarantee zoning approvals, reductions in environmental impact fees and support from neighborhood leaders, according to the newspaper.
If these allegations are true, Walmart's quick expansion in Mexico was the result of massive corruption. The first country in the retail giant's international division, Mexico currently has 2,099 Walmarts.
In the statement released Saturday, Walmart spokesman David Tovar noted how seriously the company takes the allegations. (He also made sure to remind everyone that if there was bribery, it happened more than six years ago.)
We are deeply concerned by these allegations and are working aggressively to determine what happened. ... We take compliance with the U.S. Foreign Corrupt Practices Act (FCPA) very seriously and are committed to having a strong and effective global anti-corruption program in every country in which we operate. We will not tolerate noncompliance with FCPA anywhere or at any level of the company.
So, uh, anyone want to explain the mysterious $24 million in payments? 'Cause right now — let's be honest — it's not looking so great.