Bribery Scandal Rocks Walmart

Following news about a bribery scandal involving its subsidiary in Mexico, Walmart’s stock price had its worst day in more than three years Monday, as prices fell 4.7% to $59.54. The decline helped push the Dow Jones Industrial Average back below 13,000.

The scandal already threatens to ensnare the global giant’s top management. And the problems appear only to be multiplying, with two U.S. lawmakers on Monday launching an investigation and requesting an in-person meeting with company officials. Mexican politicians have also been calling for an investigation.

Wal-Mart revealed in December that it was looking into its compliance with anti-bribery laws. An exposé in The New York Times over the weekend claimed the retailer cleared the way to expand in Mexico by bribing officials to obtain building permits and that executives later sought to cover up the evidence. A spokesman for the Bentonville, AK, firm noted that many of the allegations were more than six years old and added, “If these allegations are true, it is not a reflection of who we are or what we stand for.”


The company has been in touch with the Securities and Exchange Commission and the Justice Department about its internal probe. Neither the SEC nor the Justice Department would comment on Monday.


Wal-Mart, with $447 billion in annual revenues, has spent years trying to blunt criticism that it built its retail empire by unfairly pushing out main street competitors, squeezing its workers and pressuring vendors. The company has taken on massive environmental and women’s issues initiatives and stepped up with aid in times of natural disasters. But this round of scandal represents a major setback for the world’s largest retailer.