U.S. lawmakers accuse Walmart of tax evasion and money laundering

Jared C. Benedict, Creative Commons

U.S. lawmakers accuse Walmart of tax evasion and money laundering
Aug 16, 2012 | Raw Story / Agence France-Presse

Two US lawmakers probing bribery allegations against Walmart in Mexico say they have documents suggesting the US retail giant may also have engaged in tax evasion and money laundering.

The congressmen, Elijah Cummings and Henry Waxman, made their claim in a letter to Walmart Chief Executive Michael Duke dated Tuesday, urging him to respond to requests for information about allegations that the company violated the Foreign Corrupt Practices Act.

"We have obtained internal company documents, including internal audit reports, from other sources suggesting that Walmart may have had compliance issues relating not only to bribery, but also to 'questionable financial behavior' including tax evasion and money laundering in Mexico," said the letter, dated Tuesday.

Cummings and Waxman gave Walmart until August 28 to answer their call for documents and briefings.

"Although you have stated on multiple occasions that you intend to cooperate with our investigation, you have failed to provide the documents we requested, and you continue to deny us access to key witnesses," they wrote.

Walmart's head office had no immediate comment on the letter.

But its Mexico subsidiary Walmex said in a brief statement that it had no knowledge of any investigation by Mexican authorities into tax evasion and money laundering allegations.

The US congressional investigation is running in parallel to inquiries from the US Justice Department, the Securities and Exchange Commission and the Mexican government.

The scandal broke after the New York Times reported in April that the retail giant's largest non-US subsidiary made illicit payments to win market dominance and tried to cover them up.

During Walmart's rapid expansion of its Mexico operations in the early 2000s, the company allegedly shelled out $24 million in bribes to Mexican officials, according to the newspaper.

Speaking to shareholders in June, Walmart chairman Robson Walton vowed the retailer would not tolerate corrupt acts, promising "a thorough and comprehensive inquiry" into the Mexico accusations and said the company was cooperating with government investigators.