Wal-Mart: Low Prices, Huge Bribes

As you’ve probably heard, Wal-Mart was hit with a bribery scandal in an effort to expand stores in Mexico. What’s interesting is that we have anti-corruption laws here in the United States that punish US-based companies for acts of foreign corruption.And then Wall Street spoke and Wal-Mart’s stock dropped 5%.

The fallout for Wal-Mart could be significant. A settlement of any sort would very likely include large fines by both the Justice Department and the Securities and Exchange Commission, said Matthew J. Feeley, who works on cases involving the Foreign Corrupt Practices Act at the law firm Buchanan Ingersoll & Rooney. Any executive found guilty of a crime, moreover, could face jail time, Mr. Feeley said.

Several former and current Wal-Mart executives in Mexico and in the United States were implicated in the bribery accusations or were involved in the subsequent decision not to alert law enforcement authorities.

“I think there’s going to be a lot of pressure to come down hard on them as a company, not entirely because of the actual violations but because of the failure to do anything internally when those violations came to light,” Mr. Feeley said.