Walmart Settles Long-Running FCPA Allegations
Deal ends seven-year investigation, which generated nearly $1 billion in costs for the company

by Doug Chartier

The world’s largest retailer can finally close the book on its closely- watched Foreign Corrupt Practices Act case.

Walmart will pay $282 million to settle allegations brought by the federal government under the FCPA. Announced June 20, the deal will have Walmart pay $144 million to the Securities and Exchange Commission’s charges and $138 to settle the Department of Justice’s criminal charges. The federal agencies each alleged Walmart violated the FCPA by failing to apply sufficient anti-corruption controls in its operations abroad.

Walmart’s non-prosecution agreement with the DOJ details ways the company helped, and in some instances hindered, its case throughout the federal investigation. From cooperation to remediation measures, the DOJ noted where it offered Walmart full or partial credit, which gives other multinational companies food for thought on FCPA investigation procedures.

The FCPA makes it unlawful to pay foreign government officials to seek a business advantage, such as acquiring certain permits or licenses. The DOJ and SEC each enforce the act, with the latter bringing civil enforcement actions against public companies.

Between 2000 and 2011, Walmart subsidiaries in Brazil, China, India, and Mexico paid third-party intermediaries without ensuring those transactions weren’t improper under the FCPA, according to the SEC’s cease-and-desist. Walmart’s Brazilian subsidiary indirectly paid one such intermediary to acquire licenses and permits for the company. The intermediary made payments to Brazilian government officials without ensuring those payments complied with the FCPA, according to the SEC. The Brazilian subsidiary pleaded guilty to violating the FCPA accounting standards.

To read this story and other complete articles featured in the July 1, 2019 print edition of Law Week Colorado, copies are available for purchase online.