Exclusive: U.S. weighs retail sweep after Wal-Mart bribery scandal
By Aruna Viswanatha
WASHINGTON (Reuters) - U.S. authorities are considering launching a wide-ranging examination of the retail industry for violations of an anti-foreign bribery law, after Wal-Mart and other retailers have come forth with their own potential offenses, people familiar with the matter said.
Retailers have been reviewing their international operations in light of a bribery scandal at Wal-Mart Stores Inc's (WMT.N: Quote) operations in Mexico that is the subject of investigations by the Justice Department and the Securities and Exchange Commission.
The conduct was thrown into the public spotlight in April, when a New York Times report said that management at Wal-Mart de Mexico (WALMEXV.MX: Quote) orchestrated bribes of $24 million to help it grow quickly in the last decade and that Wal-Mart's top brass tried to cover it up.
Other retail companies have also since reported to U.S. agencies suspicions of their own potential violations, which in turn has the Justice Department and SEC considering a sweep of the entire industry, said the sources, who are working with companies who have unearthed potential issues but declined to be identified.
The people would not reveal which retail companies have reported problems, but the development could signal that the retail industry faces an expensive legal headache that could last for years.
An SEC spokesman, a DOJ spokeswoman and Wal-Mart declined to comment.
It is not clear which firms would be included in an industry sweep by authorities. A number of U.S. retailers, selling everything from apparel to electronics and office products, have extensive operations abroad.
The government teams that enforce the U.S. anti-foreign bribery law, the Foreign Corrupt Practices Act, have often turned to industry-wide reviews when they find misconduct at a few companies that could be indicative of more widespread problems. Continued...