On his Conflict of Interest Blog, Jeff Kaplan had a great post about the Walmart affair.
I won’t try to recount all of what’s in the New York Times piece, which – in my view – every compliance and ethics (C&E) professional should read.
But this excerpt will give a flavor of it:
In one meeting where the bribery case was discussed, H. Lee Scott Jr., then Wal-Mart’s chief executive, rebuked internal investigators for being overly aggressive. Days later, records show, Wal-Mart’s top lawyer arranged to ship the internal investigators’ files on the case to Mexico City. Primary responsibility for the investigation was then given to the general counsel of Wal-Mart de Mexico — a remarkable choice since the same general counsel was alleged to have authorized bribes. The general counsel promptly exonerated his fellow Wal-Mart de Mexico executives. When Wal-Mart’s director of corporate investigations — a former top F.B.I. official — read the general counsel’s report, his appraisal was scathing. “Truly lacking,” he wrote in an e-mail to his boss. The report was nonetheless accepted by Wal-Mart’s leaders as the last word on the matter.
Rather, I write to make a general point that might otherwise be missed in what I imagine will be a flood of follow-on stories about Wal-Mart’s woes, but which should be of keen interest to C&E professionals. That is, engaging in sham compliance measures – investigations and others – can itself be considered a crime, at least in some circumstances.
For more on that, see this prior post on the FCPA Blog, about how “I once represented two lawyers who were suspected by a federal prosecutor of having deliberately conducted a half-measure internal investigation for deceptive purposes. No charges were brought (and, from my perspective, none were even close to being warranted). But with the wrong set of facts the result could be different in a case involving compliance program half-measures – especially if, as I believe will happen, there is a generally decreasing tolerance by prosecutors for Potemkin programs.”
Wal-Mart’s statement issued in response to the Times piece can be found here. And, I should emphasize that I am not suggesting that Wal-Mart personnel engaged in a sham investigation. Rather, like many posts in this blog, I am using the news of the day to provide what is hopefully helpful general conflict of interest-related information to C&E professionals.