After several years of relative calm, Walmart is once again in Capitol Hill’s cross hairs.
Senior Congressional Democrats are investigating the nation’s largest retailer after a New York Times story this weekend reported allegations that the company bribed Mexican officials as it expanded south of the border and that the company’s top executives worked to shut down an internal investigation.
Walmart’s top D.C. lobbyist, Ivan Zapien, convened a meeting of his outside consultants today. Those who attended, according to a source familiar with the session, included Walmart’s former in-house Democratic lobbyist Kimberly Woodard, who now runs her own shop; GOP heavyweight Charlie Black of Prime Policy Group; Paul Brathwaite of the Podesta Group, and Capitol Counsel’s John Raffaelli and former Rep. Jim McCrery (R-La.).
The meeting took place as Democratic Reps. Henry Waxman (Calif.) and Elijah Cummings (Md.) looked into the allegations detailed in the article.
Two sources said that Walmart CEO Mike Duke and other top executives had planned Hill meetings for this week unrelated to the allegations in the Times article. The meetings were canceled after the story came out.
Walmart didn’t immediately respond to a request for comment.
“This is a big deal, and this isn’t going to go away very quietly,” said one former Hill staffer familiar with Walmart’s outreach on the Hill. “You’ve got a lot of top executives implicated, at least from what has been printed in the New York Times. It’s hard to say this will just blow over.”
Walmart is no stranger to negative attention on Capitol Hill, especially from Democrats. Six years ago, two union-backed organizations — Wake Up Walmart and Walmart Watch — routinely held media events with Democratic lawmakers spotlighting what it called the company’s labor problems and lack of health care coverage.
Since then, the Bentonville, Ark.-based company has fought its union foes in Washington while working to court Democrats, particularly those with ties to the Congressional Black Caucus and the Congressional Hispanic Caucus.
Despite its market size, Walmart has ranked only 50th so far in this election cycle on a Sunlight Foundation ranking of top campaign donors.
The company has given out $1.5 million, 67 percent of which went to Republicans, according to the Sunlight Foundation. Walmart spent $5.4 million on lobbying since the beginning of last year, down from $13.5 million spent on lobbying in the 2010 cycle.
The United Food and Commercial Workers International Union, which has a history of conflicts with Walmart over its labor practices, lost no time calling for a Justice Department investigation of whether the company violated the Foreign Corrupt Practices Act through its dealings in Mexico.
“Walmart has spent millions of dollars to rehabilitate its image and buy the support of key allies in an effort to break into new markets while making promises about the benefits of its business model,” said Joe Hansen, international president of the UFCW. “But by pursuing a relentless strategy in the U.S. and abroad of ‘growth at any cost’ in pursuit of profits, Walmart’s senior management has proven that it is willing to trample on worker rights, discriminate against women, damage small businesses and the environment, and now potentially violate laws in the U.S., Mexico and other countries.”
Walmart officials told the Justice Department that the company had begun an internal investigation of possible violations of the act, according to the New York Times report.
Despite Cummings and Waxman’s interest in an investigation, House Republicans have signaled that they have no interest in probing the matter.
“We will be working very closely with Justice so that we don’t interfere with what they’re doing,” Cummings told MSNBC today.
Cummings and Waxman have requested a face-to-face meeting with company officials and asked former company executives quoted in the Times story to come forward with information.
“The allegations that Walmart officials in Mexico may have broken U.S. laws by bribing officials to get their stores built faster raise serious concerns,” Cummings said in a statement. “But I am even more alarmed by reports that top company executives in the U.S. tried to cover up these abuses.”
Walmart released a statement today defending its internal response and overall compliance with the Foreign Corrupt Practices Act, a 1977 law that addresses bribery of foreign officials.
“In the last year, we have taken a number of specific, concrete actions to investigate this matter and strengthen our global FCPA compliance processes and procedures around the world and in Bentonville and Mexico,” the statement said. It added that the company has created a new position for a global FCPA compliance officer and has taken further action in Mexico.
Walmart is dealing with the departure of several top Washington officials. In addition to Woodard, Stephen Replogle recently said he was leaving for Cove Strategies. And just today, Bill Thorne announced that he was leaving for a top communications job at the National Retail Federation.
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