WALMART TO PAY $282 MILLION FOREIGN CORRUPT PRACTICES ACT (FCPA) SETTLEMENT
July 15, 2019
On June 20, 2019, Walmart agreed to pay over $282 million to U.S. authorities in order to settle allegations that it violated the Foreign Corrupt Practices Act (FCPA), by failing to ensure subsidiaries in Brazil, China, India and Mexico had sufficient anti-corruption programs and processes in place. Of the settlement, $144 million will be paid to the U.S. Securities and Exchange Commission (SEC) and $138 million will be paid to resolve criminal charges pursued by the U.S. Department of Justice.
Specifically, for approximately 11 years, Walmart subsidiaries in a number of countries allegedly paid bribes to local officials in connection with local projects and otherwise failed to comply with internal anti-corruption policies. For example, in Brazil, a Walmart subsidiary paid $527,000 to a third-party intermediary in order to obtain construction permits for stores while ignoring “red flags”, such as the fact that the intermediary was formerly a government official. Walmart alerted the SEC about potential FCPA violations in Mexico and other countries in 2011 after the SEC had already opened its investigation. In addition to the above-referenced payments, Walmart will hire compliance personnel to improve its global anti-corruption program and processes.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com or 202-659-6622); Drew Derco (dderco@eckertseamans.com or 202-659-6665), or Alexander Matthews (amatthews@eckertseamans.com or 202-659-6633).
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