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No Elephants Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Apr-24-12 04:54 AM
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Wal-Mart shaken by bribery probe, shares plunge
Wal-Mart shaken by bribery probe, shares plunge

Wal-Mart shaken by bribery probe, shares plunge


CHICAGO/MEXICO CITY | Mon Apr 23, 2012 10:45pm EDT

(Reuters) - Wal-Mart Stores Inc lost $10 billion of its market value on Monday on concerns that a bribery investigation in Mexico could be very costly and hinder its plans to grow.

In a sign that the problem was widening for the world's largest retailer, two U.S. lawmakers {Democrats Cummings and Waxman} said they were launching their own investigation into allegations in a New York Times article that Wal-Mart de Mexico had engaged in a multi-year campaign of bribery to build its business. In Mexico, the front-running presidential candidate, Enrique Pena Nieto, and lawmakers also called on local authorities to investigate.

If the allegations are true, Wal-Mart may have violated the U.S. Foreign Corrupt Practices Act (FCPA), which forbids bribes to foreign government officials, as well as run afoul of Sarbanes-Oxley rules that require corporate gatekeepers to report material violations of securities laws.

Legal and retail experts also raised concerns about Wal-Mart Chief Executive Mike Duke and former CEO Lee Scott, who were among senior executives allegedly aware of the situation, according to the Times. Scott still sits on the company's board.

<snip>


Shares of Wal-Mart de Mexico, which is 69 percent-owned by Wal-Mart and known as Walmex, fell 12 percent to 37.89 pesos ($2.88). The drop wiped out a 12 percent year-to-date gain in the second-most-weighted stock on Mexico's IPC index.

Shares of Wal-Mart fell 4.7 percent to $59.54, wiping some $10 billion off their market value and more than erasing this year's gains. The stock is a component of the Dow Jones industrials index, which ended 0.8 percent lower.

The news raised concerns that Wal-Mart, the world's largest retailer, may have trouble expanding into new markets.


Much, much more at http://www.reuters.com/article/2012/04/24/us-walmart-id...

Thing is, pension funds hold stocks, which is often where Wall Street and Main Street intersect big time.
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