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Walmart Pays $283 Million to Resolve FCPA Violations

On June, 20 2019, the Securities Exchange Commission (SEC) and the Department of Justice (DOJ) announced that Walmart agreed to pay nearly $283 million to resolve charges it violated the Foreign Corrupt Practices Act. The charges, filed against Walmart and its subsidiaries in Brazil, China, India, and Mexico, arose from several payments to foreign government officials without reasonable assurances that they complied with the FCPA. 

 

The SEC charged that, for over a decade, Walmart allowed several of its international subsidiaries to operate without adequate anti-corruption programs in place.

 

Walmart agreed to pay over $137 million to the DOJ and more than $144 million to the SEC. 

 

“Walmart valued international growth and cost-cutting over compliance,” said Charles Cain, Chief of the SEC Enforcement Division’s FCPA Unit. “The company could have avoided many of these problems, but instead, Walmart repeatedly failed to take red flags seriously and delayed the implementation of appropriate internal accounting controls.”

 

The Foreign Corrupt Practices Act (FCPA) prohibits companies from paying bribes to foreign government officials to obtain business and allows for whistleblowers, regardless of their nationality or residency, to anonymously file information with the SEC about potential violations and potentially qualify for financial rewards. 

 

According to the DOJ, Walmart was aware that its rapid international expansion was impeding its ability to maintain proper anti-corruption. Improper payments to government officials in subsidiary countries were left unchecked, and senior Walmart personnel who were aware of the situation did not take action.   

 

International corruption thrives when companies cut corners and take bribes from foreign officials. Whistleblowers are the last line of defense against fraud and corruption across the world and should be able to file reports confidentially without the fear of retaliation. The Foreign Corrupt Practices Act is the single most important legal tool enhancing international whistleblower protection. 

 

Resources for International Whistleblowers:

 

Visit our Foreign Corrupt Practices Act resource page

The Criminal Division of the U.S. Department of Justice and the Enforcement Division of the U.S. Securities and Exchange published a resource guide for the Foreign Corrupt Practices Act.

 

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The Whistleblower Blog is an editorially independent news and information source, sponsored by a pro bono public service project by Kohn, Kohn & Colapinto, LLP. The blog highlights important news, legal developments and policy issues critical to whistleblowers and their advocates, both in the United States and internationally. The contributors to this blog are respected leaders in their fields, including the authors of key whistleblower law books, current and former legal professors, spokespersons before Congressional committees and other public bodies, directors of non-profit whistleblower advocacy groups, and prominent attorneys specializing in representing/assisting whistleblowers in the United States and throughout Europe, Asia, Africa and South America.